Venture Capital: Crowdfunding Peers Crowdcube And Seedrs To Merge

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Crowdcube and Seedrs, the competing leaders in the UK crowdfunding market, have joined forces.

Crowdcube will acquire all the outstanding share capital of Seedrs in the transaction. Thereafter, existing Crowdcube shareholders and option holders will own 60% of the merged platform with the rest owned by existing Seedrs shareholders. The share exchange ratio has been computed on the basis of the valuations of the two companies based on the latest fundraising rounds. (CROWDFUND INSIDER)

Merger to gain scale

“We believe that you need to be a player of greater scale to serve companies and the investors who support them,” said Jeff Kelisky, CEO of Seedrs. “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 of private company investing.”

Darren Westlake, CEO and co-founder of Crowdcube, commented: “Equity crowdfunding has redefined how many ambitious businesses raise investment and engage with their customers.”

“Together with Seedrs, we can accelerate plans to further expand in the UK and overseas, launch innovative new products and improve our customers’ experience,” he added.

The UKCFA comments on the merger: “Powerhouse”

The United Kingdom Crowdfunding Association commented on the proposed merger between Crowdcube and Seedrs as follows:

“The merger of Crowdcube and Seedrs creates a real powerhouse of start-up and growth finance for SMEs.  A decade ago, Seedrs and Crowdcube pioneered this important sector, starting a revolution in finance which has been taken up around the world, and this merger gives the UK a powerful player to maintain that leadership position for the decades to come.”

Regulatory approval

Prior to closure, the transaction will need to be approved by shareholders, the Competition & Markets Authority (CMA) and the Financial Conduct Authority (FCA).

If all approvals come through, the transaction will complete in late 2020 or early 2021.

Related Story:  StartEngine Helped Everyday People Invest $200M in Startups

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