Some of the biggest questions surrounding equity crowdfunding in the United Kingdom and around the world is the safety of such investments, due diligence and the possibility of fraud. SyndicateRoom.com has brought to the table an incredibly simple, yet innovative way to answer these concerns. The SyndicateRoom.com equity crowdfunding platform only allows companies to open listings for equity offerings that have already received substantial investments from professional, experienced angel investors. Although EVERY individual MUST perform their own due diligence, there is mus to say about the assurance of investing along side experienced financial analysts and investors.
Many crowdfunding platforms explain their site by saying now you can invest like one of the Sharks from Shark Tank (or Dragons from Dragon’s Den if you are in the UK) but with SyndicateRoom, instead of investing like one of the Sharks or Dragons, you get the chance to invest alongside their real world equivalent, Business Angels.
SyndicateRoom is the uk’s first equity crowdfunding platform that focuses on the investors and investor returns. Before an entrepreneur can upload a business pitch to SyndicateRoom, the business must first have a lead business angle (or group of lead investors) on board and providing a minimum of 25% of the funding round out of pocket.
By requiring lead investors to be involved from the get go SyndicateRoom is aiming to tap into the experience of the business angels which according to a recent report by NESTA has led them to average a remarkable 22% IIR.
The lead investors provide a filter for the follow on investors by weeding out the ideas that just don’t meet their criteria. The ideas that do pass through this filter come out with a fairer valuation of the company (which can lead to higher shares per amount invested), a minimum of 25% of the round already funded, and an experienced head who will stay on board after the investment round completes. Compare this with other platforms that require all information to come from the entrepreneur themselves and you can see why SyndicateRoom’s model inspires a bit more confidence with potential investors.
But it’s not just about the investors, the entrepreneurs benefit from the experience of the business angels as well. These angels have a load of industry experience and contacts who can help the company succeed. Just imagine what would have happened to the recently failed Bubble & Balm (a crowdfunding success turned bankrupt story) if they had had an experienced angel on board who had supplier and retail experience. They might be looking at revenues instead of closure statements.
You can spend your time trying to figure out how to value a company, pick a part a marketing plan, and understand the team dynamics behind your next potential investment, or you can put your money in with the professionals investing with SyndicateRoom.
We are impressed with the innovation, ease of use and technology employed by SyndicateRoom.com and believe you must take this equity crowdfunding site for a test drive.