Seedrs: FSA and Now UKBAA for Crowdfunding Platform
With the lack of small business lending in recent years there has been an increasing emergence of alternative forms of SME finance.
Crowdfunding platforms have become a popular choice amongst some small firms but these new forms of funding haven’t yet replaced the bank manager as the main source of small business finance.
Seedrs is the first and only Financial Services Authority (FSA) regulated crowdfunding platform and now they have also been granted membership of the UK Business Angels Association (UKBAA).
Launched just this summer, Seedr’s UKBAA membership comes as a boost to the credibility of the FSA regulated investor in startups.
Startup businesses looking to find funding with Seedrs can apply for up to £150,000 and are often eligible for Seed Enterprise Investment Scheme (SEIS) relief.
Crowdfunding, despite seeming to be a single type of new entity, has actually evolved into three distinct flavours.
The rewards-based funding sees investment in exchange for non-monetary returns, generally a product or souvenir.
Then there is the debt crowdfunding, or "peer-to-peer" lending, most appropriate for later-stage businesses looking to plug the gaps left from traditional financial lenders.
Seedrs fits into the third category, equity crowdfunding. Business angels can directly invest in shares in startups and the UK is seen to be one of the leading places for this particular type of crowdfunding.
Jeff Lynn, the co-founder and CEO of Seedrs, was upbeat about his firm’s appearance on the financial stage, saying:
“In just a few short months, Seedrs has proven just how productive this new model of investing and funding can be. As well as opening the door to private investors who have never been able to invest sensibly in startups before, we are also providing an easier and faster way for angel investors to find great new businesses and widen their portfolios.”
Commenting on his platform’s UKBAA membership, Lynn added:
“The fact that the UKBAA has embraced us shows that we are a serious new part of the angel investment world, as well as a new way for the smaller investor to enjoy the satisfaction and high potential returns from investing in startup businesses.”
Jeff Lynn also met HRH the Duke of York recently to discuss supporting Seedrs. Speaking of his meeting, Lynn finished:
“It was an honour to be invited to meet HRH the Duke of York on Tuesday at Buckingham Palace. He understands that Britain leads the world in bringing these new and innovative financial models to the market and he can see what a big positive impact we can have on the UK economy. His obvious enthusiasm and willing support for the movement that Seedrs is spearheading bodes very well for our continued success and the expansion of this sector.”
Startup businesses and potential investors can see more details of the crowdfunding platform at the Seedrs website.