Freetrade’s CrowdCube Fundraise

Why would you be concerned about it at all? The dilution is not simply a loss on whatever number of shares you have, it is the capital that the Team will use to generate more growth.

And whilst you lose in value immediately, the return on equity will definitely beat the natural growth, hence you would only benefit once again.

Same happens with public companies, when they issue new shares to raise more capital, this is done for a greater aim, meaning that the overall share price rebounces within days/weeks.

Hence the more dilution there is, the more growth potential can be utilised.

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I think even with future dilution we will never get to buy these shares at 54p ever again. As the value of the company grows the chunk needed to dilute gets smaller.

Look at Monzo, they did a large (by company size) dilution at £2.36, but 2 years ago the share price was 50p. Even with the dilution you couldn’t buy back in at 50p.

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I thought I would not go deep into the Scientifics of it, only wanted to make it clear that in this instance dilution is the way forward.

But you are certainly right :sweat_smile:

Totally agree with this, my vintage hoodie is still a conversation starter

:nerd_face:

image

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was the email sent out today?

Hi everyone, some more details to share on our next crowdfund.

We will be opening our Crowdcube campaign on Wednesday, May 16 at 1 pm. :tada:

This will only be open to existing investors and community members initially. You’ll need to get the secret link from @Viktor when he emails the community on Wednesday. If you aren’t already on the list, better not wait and sign up at www.freetrade.io.

Key raise details:

  • ÂŁ500k initial target

  • ÂŁ18m pre-money valuation

  • ÂŁ0.54 share price

  • EIS eligible

Once we go live on Crowdcube you will be able to access our pitch video and investor deck. The investor deck is 50 pages and includes financial forecasts. To access the investor deck you will need to have a Crowcube account, so if you haven’t already, I’d sign up for Crowdcube now in case you have any issues on the day.

More information to follow in the coming days…

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ÂŁ18m pre-money valuation, does this mean if you raise ÂŁ2m (for example) the new company valuation after the round closes will be ÂŁ20m?

That would mean ÂŁ20m post-money valuation indeed.

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Cool!

How long will the exclusive period last for? Any details on overfunding?

Hey awesome people, here are the details and plans for the raise next week (and the plan for what we’ll do afterwards). Can’t wait to get going! :grin:

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  • 24 hours exclusive period
  • We’ll consider overfunding, as the round progresses. The best way to make sure you get to invest is to pledge your investment during the initial 24-hour private phase.
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Thanks I will. Let’s hope their website doesn’t crash like it did for another campaign :slightly_smiling_face:

@adam One possible reward for existing investors could be a exclusive period for previous round investors? So maybe they get the link at 12? :smile:

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Disagree! You will overfund in that 1-hour slot so that we will not even have a chance! :joy:

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Is the free alpha for life likely to include SIPPs when you offer them?

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We’ll have more detail closer to the SIPP rollout on folding it into Alpha. We can’t 100% guarantee it right now but it’s certainly a good bet!

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Agree that it would be nice to give some exclusive period for previous investors

I’m not sure that’s necessary since -

I could be missing something though?

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That’s a cool idea!!

I thought to start as a new topic but was not quite sure whether the question deserves one.

Once the pledge is given through Crowdcube, what is the process next? Will the funds be debited at any point when the opportunity expires or will you have a chance to review the decision?

What if the bank rejects the transaction initially (hello Barclays anti-fraud department) and will require you to confirm your intentions before paying again (simply sending them a text that you approve the transaction)? Will you have a chance to pay again or do you only have one chance and then you are screwed if the bank does not process it on the first attempt?

Not sure if anyone else had similar concerns or precedents.

Thanks.

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You can review your decision. It was always smooth for me personally, but I think @HannahCrowdcube might have some more guidance on this.

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