The merging of crowdfunding pioneers Crowdcube and Seedrs is positive news for high growth businesses globally.
Equity crowdfunding has grown steadily in popularity and boasts some significant successes such as Brewdog, Revolut, Perkbox, what3words, and Moneybox to name a few.
The merger will create one of the world’s largest private equity marketplaces. The value of the merged company is $140 million.
The merger is being structured as an acquisition by Crowdcube of all of the outstanding share capital of Seedrs, via scheme of arrangement. Existing Crowdcube shareholders and option holders will own 60% of the combined company, and existing Seedrs shareholders and option holders will own 40% of the combined company. According to a joint statement, the merger ratio reflects the approximate valuations of the two companies based on each of their most recent fundraising rounds.
Jeff Kelisky, Seedrs’ CEO, will become CEO of the combined company, and Darren Westlake, Crowdcube’s CEO and co-founder, becomes executive chairman. The management team will include key people from both businesses.
Darren Westlake, CEO and co-founder of Crowdcube, commented: “Equity crowdfunding has redefined how many ambitious businesses raise investment and engage with their customers. Today’s agreement is an incredibly exciting milestone that will benefit high growth businesses, their investors who believe in their vision and the wider entrepreneurial ecosystem that supports them. Together with Seedrs, we can accelerate plans to further expand in the UK and overseas, launch innovative new products and improve our customers’ experience.”
Jeff Kelisky, CEO of Seedrs, said: “We are both fintech pioneers that have challenged the landscape of capital raising in Europe, building marketplaces for private equity investment. We believe that you need to be a player of greater scale to serve companies and the investors who support them. Now is the right time to bring our strengths together, in order to meet our common mission to deliver a step-change in the accessibility and efficiency within private company investing.”
