Crowdfunding platform Seedrs targets sport following restructure

The manging director of Seedrs Europe talks 2024 plans; a recent restructure; and why he think sport will be big on the crowdfunding platform this year.
Crowdfunding platform Seedrs targets sport following restructure

Could Manchester United, Arsenal or Nottingham Forest raise money on a crowdfunding platform in the future?

Such a scenario is not unthinkable, says the European boss of crowdfunding platform Seedrs, who is predicting sport to be big business for Seedrs in 2024.

John Lake, a long-term Seedrs executive recently appointed to head up its European business, says, for the first time, an unnamed Championship football club (English football’s second tier) is to fundraise on Seedrs.

Football clubs to have previously raised funds on Seedrs- South Shields, Altrincham FC, Dorking Wanderers and AFC Wimbledon-have been in the lower divisions. The four UK football clubs raised over £8m from over 7,000 investors on Seedrs.

And Lake says he wouldn’t be surprised if a Premier League club is next out of the traps.

“It could happen,” says Lake. 

“Sport is a really interesting sector that we will be targeting. I am a big believer that what we do, allowing retail investors into rounds, and that is effectively fan engagement whether you are Revolut or AFC Wimbledon.”

Such a move would bring the Premier League more in line with Bundesliga, in Germany, where fans own majority stakes in the clubs. 

Earlier this month, the government announced its plan for an Independent Football Regulator (IFR) for the professional men's game, including an obligation for clubs to consult fans on key decisions.

And with ownership of Premier League clubs not infrequently changing hands, bringing in fans as investors can appease unrest at the change in ownership, says Lake.

But the Seedrs executive cautions that Premier League bosses might need to be educated on the workings of crowdfunding.

He said:

“I think there is probably education required. Letting them know that 20,000 fans are not all coming on the Cap Table and not having a board seat and not in direct dialogue with the chairman or the lead investors.”

UK based Seedrs, founded in 2009 and which helped Revolut raise funds, was acquired by US startup investing platform Republic in 2021 in a $100m plus deal.

The integration of the two businesses, says Lake, is one of two reasons for last year’s job cuts across Seedrs’ global business, the other being detrimental economic factors, which had a negative impact on fundraising.

Around 15 per cent of its European team (15 people) exited the business, with jobs cuts in the UK, Sweden and Spain.

Lake says:

“Effectively with those two things coming together, we did have to do a restructure of parts of the global business and that did include making some difficult decisions in terms of reducing the total number of employees globally on a role by role basis.”

Despite the job cuts, Lake says that Seedrs, which lost £9.7m in 2022, compared to a £2.8m loss in 2021, is still active in all European markets.

Post-merger integrations are “never easy”, says Lake, but he points out that the Republic/Seedrs combo is the only platform where businesses can raise funds in the UK, Europe and US at the same time.

Republic features soon to come to Seedrs include sharedrops (gifting equity) and tokenised assets.

In 2023, Seeds took part in 268 rounds totalling over £353m with 88 campaigns raising over £1m. 

Notable campaigns include lifestyle credit card Yonder, raising over £13m and GrowLab, the medical cannabis firm, which raised £6m.

Hot areas in 2024, says Lake, along with sport, are likely to be fintech and greentech, while sizeably-backed VCs will also be on the rise on the platform.

Vis a vis 2023, Lake expects to see growth in 2024 in funding rounds on Seedrs but not a return to the high levels of 2021 and 2022.

Entrepreneur Steven Bartlett’s Flight Fund- which backs Elon Musk’s SpaceX and meal replacement brand Huel- has recently gone live on Seedrs, opening the fund up to a broader investment base.

Lake said it has had a "strong start” on the platform, with “north of 50 investors” in less than two weeks.

Lead image: Tembela Bohle.

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