Seedrs has helped startups raise a total of £2.3 billion in 1,870 funded deals

“Investing in equity and entrepreneurs was this really hard to access, illiquid asset class which has been the bastion of the elite, and that hadn’t really changed in over 100 years: somebody who wanted to invest in ships to import spices would go to Mayfair and find an investor. 100 years later, an investor looking to fund their startup would go to Mayfair. With the invention of the internet, there was an opportunity to open the market up, and now 12 years later, the world looks somewhat different,” says Jeff Kelisky, CEO of Seedrs.

Seedrs – is an equity crowdfunding platform that enables investors of all shapes and sizes to invest in ambitious startups, its helped startups raise a total of £2.3 billion, with 1,870 deals funded so far.

To get started as a crowd fundraising platform, Seedrs faced the challenge of needing to get cooperation from industry incumbents: “investing is very different in the sense that it defines in some ways coopetition. A lot of the founders get funding from multiple sources from the big institutions to the retail investor. So we participate alongside private equity and alongside angels, so we needed to be accepted as an equal or value add platform.

“There was this tarnished view of crowdfunding because it was retail investors, and not necessarily professional investors, so building credibility was one of the fundamental hurdles to overcome and that took time because it was reliant on relationships which were reliant on proof.”

Today, Jeff says, climate tech is Seedrs’ fastest growing investment vertical – clean energy saw 40% more investors on Seedrs in 2022 compared to 2023: “that news spreads each of those investors becomes a storyteller to their network so that will only accelerate.

Jeff believes in 2023, we’ll see an investment growth trend in all forms of EV’s – cars, bikes and boats as well as in renewable energy.

What type of startups succeed on the platform?

There are over 17 different sectors represented, from climate tech, data analytics, consumer products and food and beverage, and there isn’t any one sector that represents more than about 12% of the total. That said, the fastest growing sector right now is climate tech – energy, and sustainability as a category.

How do companies benefit from using crowd fundraising?

They want to use the opportunity to create brand ambassadors, to actually turn customers into evangelists of who they are, and in some cases, to also acquire new customers and bring on board new members of their community. That community dimension becomes an important part of making a round successful.

Be creative about how to harness your network

We had a small group of founders who put together a business around ice cream. They’d recently won a contract with Waitrose, but it’s a small business, and so there was no way they could actually see how that contract was rolling out across all the Waitrose stores in the UK. So they gave their investors a mission; ‘next time you go to your local Waitrose, please take a photo of the ice cream on the shelf, because we’d like to know that it is on the top shelf, and the label is facing forward, which is part of the contract.’ Three things happened: they got photos, their community of investors and customers felt connected to the business, and the third thing is, they probably bought the ice cream!

Is Crowd fundraising better for B2C or B2B startups?

It’s definitely easier as a B2C business to tell your story in a way that’s understandable and as something that consumers can relate to. That being said, B2B represents 40% of what we do, so it is absolutely not exclusive. We’ve had very successful software accounting companies raise capital. One thing to look at is how what you’re doing has a strong emotional connection. Increasingly, investors are millennials and Gen Z, and are making investment decisions which connect to who they are, their values, the things they’re passionate about. But whether you’re B2B or B2C, you need to tell your story well.

What are your top 5 tips for effective storytelling?

  1. Show us your roots – The most endearing stories are those that give us that moment of inspiration and/or personal experience. For example, the story of Mr Lee’s Noodles (a healthy pot noodle business) told investors of the Founder’s inspiration for healthier noodles following his battle with cancer where he craved for healthy comfort food.
  2. Align your vision with your community – consider how your business’ beliefs, mission and values align with the community’s desires. For example, Ripple, which enables households and businesses to part own large scale wind farms and (in the future) solar parks, met many people’s desire to be part of something greater and make an impact.
  3. Translate your mission creatively – A brand’s creative can be done on a shoestring and still hold a powerful role when it comes to connecting with an audience. It can visually create an immediate emotional response and a consistent and unique visual brand identity, illustration style, and even brand ‘characters’ help cement space in people’s minds from day one. Look at the sustainable hygiene B-Corp Cheeky Panda – their logo and style is instantly recognisable.
  4. Make them feel involved, bring them on the journey – This is key to forming an exceptional brand experience. Developing key touch points through newsletters, social media channels and events are effective ways to get closer to your audience and make them feel engaged as you scale.
  5. Be known for openness and transparency – Be open and transparent about your company’s culture, realistic for your valuations and give insight into how the company performs that is clear and easy to understand. Don’t be afraid to talk about your failures. Most of our successful entrepreneurs are “phoenix founders” on their second or third startup. Being open about the difficulties you’ve faced and the learnings is a critical part of telling your entrepreneurial story.

Do you have advice for startups on building community?

Connect with your existing network

First, it’s about connecting with the founder’s existing network, it’s very much about the story being told and how to do that and then getting introductions to the right groups to do that.

So if you’re in a particular space, who are the institutions that would also be interested in joining and anchoring around that?

It’s about honing your story for different audiences. And again, that sounds perhaps an obvious step that all founders have to do anyway. But you’re doing it in the context of a broad crowd and therefore it needs to be consumable at scale.

Build Momentum

Build momentum in a campaign. There’s a lot out there for people to invest in. There’s a lot out there for people to be distracted by, especially in a social media context, so getting attention is something you should manage. And while it takes a lot of effort, the construction and sequencing of a campaign is important.

Have you seen a decline in investment due to the recession?

Last year, we saw over 141,000 individual investments in 324 campaigns and just over half a billion pounds raised. We served more entrepreneurs last year than we did the year before.

The biggest challenges were less from the direct retail audience, it was more that institutions were more timorous. So that reduction in the institutional side or anchoring side was where we saw a difference; it wasn’t the retail participation.

Uncertainty Breeds Entrepreneurship

There’s one common truth and that is uncertainty breeds entrepreneurship.
It is often when entrepreneurs are born. In some cases, they’re born because they have something they want to do and say and they see a problem, and sometimes it’s because necessity meets opportunity. We’ve seen the birth of more entrepreneurs during difficult times.

We’ve seen it with the Ukraine war, the outpouring of communities looking to solve problems, and get behind founders who have solutions to some of those problems. So that gives me hope, entrepreneurship is not in decline.

Who are your role models?

It’s hard not to answer that question without bringing both my parents into that answer. My Mother, who passed away many years ago, will be very happy that we are having this conversation. She was absolutely a woman of nature, of the environment, supporting ecology. The fact that my professional life is intersecting with something that she spent so much time putting her love into probably fills me with enough energy to go through most obstacles.
I started my career in a corporate context in IBM. At the time it was a 50,000 employee organisation and it was going through turmoil. In the early 90s, it declared the largest ever loss by a company, which was $53 billion. And a new CEO came in by the name of Lou Gerstner and he solved that problem of saving IBM. It was an impossible task, because the only thing you could do was to break it up into small units, and I got to see his work from the inside.

To see someone wrestling with an almost impossible corporate challenge was phenomenal to watch. He was very much about, ‘we need to harness the power of all the parts of IBM to do something nobody else can do’, rather than take the easy path which is to break it up into separate units and everybody does their own thing. Communities came together and integrated to become stronger, so he was someone who inspired me.

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