59 per cent of British investors have not heard of ‘crowdfunding’ and only a third is aware of the Seed Enterprise Investment Scheme (SEIS), which offers a range of tax reliefs to individual investors who purchase shares in early-stage companies.
A survey of 1,000 investors commissioned by InvestingZone, a crowd equity platform helping early stage companies raise money directly from the public, found that 75 per cent believe investing in strong, promising private companies is only available to a small group of investors, whilst 86 per cent feel there needs to be better access to unlisted/private investment opportunities for individuals.
Jon Moulton, backer of InvestingZone and founder of Better Capital commented: “A real opportunity for a new method of raising money at a sensible cost has appeared but is still relatively unknown. At a time when low interest rates are causing many to look for better returns, unlisted equities, supported as they often are now by great tax incentives, are an attractive proposition as good UK prospects are still going unfunded.
“The survey confirms that investors like the crowdfunding idea but really want to use a crowdfunding platform run by people with real VC experience, which is the reason I backed InvestingZone in the first place. The team knows what it’s doing when it comes to helping ambitious small private companies, which can’t be said for everyone in this space.”
Patrick Newton, Chief Executive Officer of British satellite data processing company Rezatec, which has so far raised £450,000 so far and is aiming to complete its £500,000 target on InvestingZone, commented: “It’s important to start off with a sensible capital structure which is equity, not debt. For the remaining funding we’re very happy to be welcoming passionate investors using crowdfunding alongside finance we’ve already received from the Technology Strategy Board (the UK’s Innovation Agency), the UK Space Agency and the European Space Agency.”
Jean Miller, co-founder of InvestingZone added, “Crowdfunding gives investors direct access to some exciting early stage investments at the start when the price is low. They can browse company pitches at their leisure and invest as little as £100. As a professional equity platform, we ensure that the companies listed are genuine investment opportunities and the valuations are sensible.”
The survey confirmed that the majority of Investors (82 per cent) find it exciting to get involved with new/interesting investment opportunities they personally select. 73 per cent like the idea of investing through an equity platform with other affiliated professional investors.
About the Research
The survey was conducted by Coleman Parkes Research and commissioned by InvestingZone. Consisting of 1,000 online interviews with investors involved in making decisions for their own portfolio, the survey was carried out in July 2013.