Megathread - Crowdfunding

Not a fan of Chip, but the growth of the last 12 months has been impressive. £20m Revenues and breakeven


I’ve talked a lot of shit about Chip and I stand by most of it, but it is impressive that they’ve been able to achieve such a turnaround. I do not think it speaks to the brilliance of the leadership, considering they were wasting so much time and money on ridiculous activities like car investments and crypto, I think they were in the right place at the right time… but surviving long enough to be in the right place at the right time is most of the battle, and so credit is due for that, even if it was by accident and they were months away from bankruptcy.

I remain skeptical about their long-term success because I do not think this speaks to the leadership’s brilliance. The campaign they’re running now further proves that what they said in the past was a misrepresentation at best (and a lie at worst) because they’re now acknowledging that at the start of this year, they had less than £300m AUA despite their previous campaigns shouting about over £1bn in deposits (which was intentionally worded to mislead people)[1].

Maybe my view of Chip is too cynical because of the past, but… their success this year has been by virtue of being at the top of the Money Saving Expert list for savings accounts that pay the highest interest. However, as of about 2 months ago, they stopped pursuing being the best and fell behind so much that they haven’t even been listed by MSE. The revenue they generate from AUA will trail deposits so the revenue they generated most recently could be based on deposits from a time when they were top of the MSE list. The choice to stay at 4.84% instead of competing with the top offered rate of 5.22% may explain why they’re now making a profit this month: they’re banking profit at the expense of growth for the crowdfunding narrative.

What really matters is whether the deposits they’ve had are sticky: what’s their churn like now that they’re no longer the highest-paying savings account? Have they built a sustainable business that doesn’t rely on this abnormally high-interest environment? Does the profit this month represent the beginning of an upward trend… or the peak?

Considering their history of having a tenuous grip on the truth, I am very suspicious about their choice to raise now. If you’ve gone from losing £1m/month to profiting £500k/month why would you waste time crowdfunding, why wouldn’t you spend all of your time focused on your money printing machine, why would you give away equity at the same valuation as when you were hemorrhaging money… but hey, what do I know, I would never have predicted this 12 months ago.

[1] 1 year ago “500k+ savers across the UK with £1bn+ saved through the platform”, today “Growth: Deposits increased 10X to £3bn & customers 2X to 219k in 2023”.


I’m a bit torn on this one as well.

I invested a small amount in Chip’s first crowdfunding round.

I have not invested in this round, as the much higher valuation (£167M) will mean only a small dilution on my holding.

The crowdfunding raise does make sense from the perspective that they are targeting their customers who may want to invest, and that may make them stickier for the Chip app. Freetrade has taken a similar approach over the years, and it appears to have been beneficial to the business.

That’s a fair point. Chip is unique in that their business is as much crowdfunding as anything else and so if any company is positioned to crowdfund in a cost-effective manner, it’s Chip. Extra money in the bank isn’t a bad thing, and the dilution is negligible. You’ve convinced me, the decision to crowdfund now is sensible.

I have always been positive about Chip and the CEO in particular Simon Rabin he has a good way about him. Credit must go to Chip for reinventing itself as the world has evolved,not an easy thing to do.

They seem to do well with every Crowdfund they run, 4 million at a 167 million valuation is crazy.

Think it bodes well for Freetrade if they looked to Crowd fund any time next year.

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Another opportunity for Grind investors to sell their shares. This time at £1.17 per share. Previous opportunity was last December at £0.97. This follows additional £10.5m investment by a current shareholder


Yeah I’m holding with Grind (invested in 17 & 19). Impressive growth achieved and forecasted (realistic compared to the nonsense some CEOs spout about growth that never materialises). Richard Koch is a serious heavy hitter and he’s 30M+ shares (£40M value) deep and investing more to fund the buy back (smart) and further growth especially on DTC channel…

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I didn’t sell any last December and think i’ll hold again (or maybe sell 10 - 20%). Seems like the value can only go upwards and the big investment from Koch is a massive endorsement too

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Never understood the dilution argument. Only relevant if you own a heavy percentage of a company and voting rights