\Venture Capital News/

Crowdfunding platforms Crowdcube and Seedrs agree to merge 

Crowdcube will acquire Seeders, with Crowdcube’s shareholders owning 60% of the combined business.

By Freya Pratty

Crowdcube and Seedrs, two equity crowdfunding platforms based in the UK, have agreed to merge to become “one of the world’s largest private equity marketplaces.”

The terms of the deal have been agreed Seedrs’ current chief executive Jeff Kelisky will serve as combined chief executive of the new company, whilst Crowdcube founder Darren Westlake will become executive chairman. 

The merger still needs to be approved by the UK’s Competition and Market Authority, which is expected to be completed in late 2020 or early 2021. 

Advertisement

“By joining forces, we’ll be able to harness the best of both companies as we accelerate our shared mission to create the world’s largest private equity marketplace,” wrote Seedrs’ Kelisky.

Through the merger, Crowdcube will acquire the outstanding share capital of Seedrs. Existing Crowdcube shareholders will own 60% of the combined company, and existing Seedrs shareholders will own 40% of the combined company —  reflecting the comparative valuation of both companies. 

The two platforms are amongst the leading equity crowdfunding platforms. Since 2011, over £2bn has been invested into campaigns on the two platforms combined and, together, they’ve secured funding for over 1,500 companies. Revolut, Brewdog and Perkbox are amongst the companies to use the platforms. 

In April of this year, however, Seedrs reported seeing 20% less funding on the platform than the average across the previous three years.

“Activity, both in terms of campaigns going live and volumes of investments, has slowed a bit from what we would normally expect,” Seedrs chairman Jeff Lynn told Sifted.

“The 20% drop… was primarily from startups not going live,” he explained, with numerous campaigns perhaps anticipating reduced investor appetite.

Kelisky, Seedrs’ chief executive who will take on the same position across the merged company, said in a statement that the new company will focus on innovation and new products. 

“Going forward, the combined company will aim to deliver new innovations and products that will make it significantly easier, more affordable and valuable for ambitious businesses to raise growth finance.”

2
Join the conversation

avatar
  Subscribe  
newest oldest most voted
Notify of
Paul
Paul

Desperate times.

Paul
Paul

Going to be interesting to see who invests in the talked about 2021 big raise. If its VC then I wonder at what value as new ones would probably only come in at a big down round. If it’s done via crowd would hope they have the morals to give the crowd preferences that a VC coming in later would also normally expect and demand rather then bargain-basement ords while earlier investors in the Series A and B1 , B2 redeemable convertibles keep their preferences or maybe they go away as part of the whole deal