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Equity-Based Crowd Funding: Realistic alternative for the Scottish SME Manufacturing Base raise investment for R&D and Business Growth?
Many initiatives to support Business Investment
The Scottish Government has put in place a plethora of initiatives to assist companies to assess the benefits of investing in advanced manufacturing technologies and equipment to address Twenty-First Century societal challenges and needs such as the Advancing Manufacturing Cluster Builder (AMCB) programme which is managed by CeeD.
The new National Manufacturing Institute Scotland (NMIS) as well as the Scottish Manufacturing Advisory Service (SMAS) also offer support to businesses.
These programmes recognise that investment in Scotland’s wide-ranging manufacturing industry plays a central role in sustaining and growing our economy.
“Equity crowdfunding is the on-line offering of private company securities to a group of people (the Crowd) for investment.”
As such, it may be an alternative vehicle for businesses operating in the high-value manufacturing sector to raise capital for R&D and business growth. Indeed, it’s argued that companies may be able to realise better investment terms at higher valuations, much quicker than through traditional routes, such as angel syndicates, and partly to early-stage VCs. However, what evidence do we have that this is true?
The Prevention of Waste post-harvest through robotics facilitated detection of spoilage and pest growth.
CeeD is working with the following organisations to ask whether crowdfunding is a realistic means of raising investment:
- Crowdcube, one of the first UK investment crowdfunding platforms; and
- Crover Limited, an Edinburgh company developing a robotic device to verify the integrity of stored grain.
For Crover, this seems to be the case as the company announced recently that it had exceeded its £150,000 crowdfunding target and, at the time of writing, had raised nearly £179,500 from 309 investors at a pre-money valuation of £2.5 million.
Crover will use the new finance to begin small series manufacturing, with the aim of establishing additional manufacturing plants in the UK, Europe and the USA.
Can any start-up considering manufacturing do likewise and is raising investment through crowdfunding a realistic proposition for our SME manufacturing base?
How does a company with a technology ready to manufacture, go about listing on a crowdfunding platform and what other examples, like Crover, do we know of?
Dr Lorenzo Conti, Founder and Managing Director of Crover Ltd conceived the company’s robot technology for locomotion in bulk solids in order to reduce grain loss during long-term storage, by mapping conditions inside grain stores.
Learn more about this - and why he approached Pete Gwilt, Equity Campaign Manager of Crowdcube for help in securing investment - at our upcoming event on 27 July , 10am - 11.15am. REGISTER here.