Megathread - Crowdfunding

Quick question - has anyone invested in Perkbox and has a general sense of how the business is going? Was thinking whether to buy some shares on the Secondary on Seedrs. I see they expanded in the US and with this return to office wave and re-found focus on work life and cost of living putting pressure on business to make up for some of that via perks and benefits looked like an interesting opportunity at the right share price/valuation.

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I live in a flat and it just doesn’t cut the mustard? It’s what’s known as a moneypit and will never make it. A bit like that tunnel company Magway!

I kind of agree with you on What3words. I can’t see how it will ever make a profit

However I think you’ve got the definition of Cash cow mixed up. It’s generally though of as a good thing

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Regarding drone deliveries, Firstly why does a drone need to know three words? it will have GPS surely?

also Drone deliveries and What 3 Words are both equally ill suited to multi storey blocks of flats…

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Some emergency services have warned against the accuracy of what3words plus the idea that location services should be private goes against a lot of people’s views.

We already have OS grid references which take you down to a 10x10m square for an 8 figure grid reference and GPS gets you more accurate than that.

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Yes however W3W system is undeniably easier to use than co-ordinates or grid references. Essentially anybody can use the system effectively within 5 seconds of opening the app or being explained how the system works.

Monetisation is certainly a big issue. If we use Citymapper as a comparison. They too built an impressive product arguably better than google maps in some areas. However as we saw - they were unable to consistently monetise the product and sold for a low figure.

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Again, agreed. I think there could be quite a scandal brewing over Crowdcube/Seedrs. Having now taken 3 companies to IPO over my career, there’s really no reason for companies to crowdfund in the first place. Secondly, their valuations are always wild. They give away minimal stakes to crowdfunders and are almost always overvalued - with no clear exit. Early seed and VCs are much more demanding of a clear path to exit and initial investment recovery. Crowdfunders much easier to ignore.

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Small robot company webinar recording

Some news from Nanusens. I invested in this. I have been a bit sceptical on their progress but it seems like it might come good

https://www.internationaltechtimes.com/article/639643770-nanusens-secures-first-ip-license-for-its-revolutionary-mems-in-asics-sensor-technology

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Agreed - I’m fairly excited about their recent hires as well. At the last Crowdfunding it felt like a big gamble but worthwhile as the potential is so big for Nanusens if they can get it right.

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Defo - things are starting to come together nicely. Quietly confident about this one. The upside if they can fully commercialise this is off the scale given they will have a clear run due to lack of comparable products. These are the opportunities that really excite me and I invested quite heavily twice a few years ago. Securing Series A is the key hurdle and the recently announced deal (and ones to follow) and leadership team acquisitions are big box tickers.

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Looks interesting

I’m officially done with crowdfunding, after 12 investments totaling c.£15k.

CIRCA5000 just launched a round (in which I’m a previous investor). It’s a down round of c.50% and there is literally no detail about anything useful in the pitch deck at all. I am sick of companies taking the piss of retail investors as a route of an easy cash grab.

The lack of disregard, disrespect and 2nd class status given to retail investors whether that be the lack of literally any useful financial information or even BAU investor updates is appalling.

Why on earth take the risk? The typical exit is 2 or 3x, and an exit is not typical.

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I always think, the companies that turn out bad you lose your investment, the good ones get bought out by a bigger company before you can get the big multiples return on your investment (most of the time).

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I remember CIRCA5000 raise back in 2021. They came across as very rude and dismissive to people asking genuine questions and totally ignored some questions completely. For that reason I withdrew my investment.

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That has been my thinking throughout… but more and more I’m hesitant, as what are these big multiples in reality and over what time period? The UK seems stuck in 2/3x multiples. Not 10/20x multiplies.

My hunch, is that unless you were a lucky R1/2 investor into Freetrade, Monzo or Revolut, probably you would have been better off investing in a Vanguard ETF.

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I’ve not seen the Circa5000 fundraise this time, but last time they raised its was a similar story!!

I think you will be pleaseantly surprised with the Freetrade crowdfunding based on what they have already shared at the last meet-up.

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No EIS = no investment for me. Significantly reduces the risk.

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That’s true of all early-stage investing: everything will fail. Success is an aberration, an anomaly, the unlikeliest of outcomes. The fundamental problem with crowdfunding is that it encourages unsophisticated investors, without money to lose, to engage in high-risk behavior that sophisticated investors with money to lose would never engage in. Seedrs and Crowdcube are somewhat responsible but the real blame lies at the feet of the regulatory bodies that allowed this wholly predictable mess.

The outcome of the crowdfunding experiment is a testament to how uninspired we are as a nation, it’s embarrassing, inevitable, and a lesson we won’t learn from. We can each look at a company like Circa5000 and think, “Only a fool would invest in that company! There are so many red flags!” and yet… every one of us invested in Circa5000 because the tax-funded Future Fund poured more than a billion pounds into the red-flag filled campaigns that litter this thread.

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Well said :clap: