Iāve invested in around 45 companies now via Crowdcube and Seedrs and Iād take Crowdcube any day of the week. I paid Seedrs 7.5% on exit and that was painful. In terms of due diligence, are people still upset about Sugru because Iāve lost plenty via Seedrs?
Personally, I might not be a huge fan of the way that CC operates at times, but for the sake of keeping all of my Freetrade investments in a single place then I think that Iād prefer it this round was run via CC.
Quite right. Both Seedrs and Crowdcube could be better at managing their stakeholders, longer term this might lead to them losing out to either each other or a new entrant. The lack of updates from some companies is shocking, how much time does it take to do a quarterly update?
Probably an unpopular opinion but I believe the sole responsibility for due dilligence should be on the investor, much less so on the platform. Both crowdcube and seedrs are very high risk forms of investing anyway, but that is what leads to opportunities for big returns. As far as I can tell crowdcube provide plenty of ways to contact the entrepreneurs via email or telephone if you have further questions about the pitch, if you donāt like what you see, donāt invest in that company!
Iām not going to start blaming Freetrade if I make a poor investment on their platform!
Agreed, most businesses are terrible at communicationā¦ It is one of the major reasons I wonāt invest in a second round - if you wonāt communicate with your investors then I struggle to see how you will manage your customers. Seedrs and Crowdcube are as bad as each other in managing this.
In saying that there are some great companies who put effort into communicating with investors and so far these companies have been my most successful.
Personally I vote for free trade to facilitate crowd funding through their own platform without either crowd cube or seedrs but granted thatās easier said than done and far more important things for the team to be working in than a new compliance point. Just my thoughts. BTW I have investments in both other platforms
The reason companies use Crowdcube or Seedrs is to avoid having hundreds or thousands of shareholders with the administrative overhead that brings. Instead they deal with Seedrs or Crowdcube who manage those elements on the companyās behalf. Iād rather any spare admin or development cycles were spent on the main product to be honest.
My current star player Solar 350 removed their pitch from Crowdcube early in the campaign and set up their own. I invested directly with them. I did it over the phone and via email but now they have a platform with a couple of other companies on
I would like most of the funding to be restricted to those who had early faith. I am not an original 1sr round investor but we all know we get watered down even if itās for great expansion. I think and hope that investors (I know bonus shares are a long way away!!) are rewarded at least by giving them option to retain their holding . Without us free trade wouldnāt be going anywhere. Can you offer all investors rights to buy say up to 4 times original investment and then second round 2 times to mop up remaining?
Seedrsā 7.5% fee on gains is analogous to hedge fund performance fees - they take a hefty cut from the substantial upside while investors are exposed to 100% of the downside!
Iām very surprised at the preference for Crowdcube over Seedrs here having used both extensively.
I have a major preference for Seedrs as think the secondary market and community is worth the potential fee. Itās 7.5% of gains so interests are aligned, and if you are making diversified investments likely to be less than the Crowdcube charge.
Sorry for the ambiguity. If you own shares in the company Seedrs. It is exactly the same as any other investor forum on the platform but obviously there is more activity and discussion than most since itās about the functionality etc.
Ok, Iāve invested in three companies via the Seedrās platform. Post the closure of each funding round we shareholders still have a private set of company pages that contain the pitch information & docās, EIS paperwork, company updates and a discussion board/forum. This appears to remain open to us for each company for as long as we are still shareholders, but as far as I can tell they are closed/private groups.
