Today, we have announced with Seedrs that we have agreed to a merge, in a move that will accelerate our shared plan to create the world’s largest private equity marketplace and further democratise investment. By joining forces, thousands of ambitious fast-growth businesses and millions of investors will be able to benefit from the best expertise, services and returns offered by Crowdcube and Seedrs’ investment platforms.
On completion, Jeff Kelisky, Seedrs’ CEO, will serve as CEO of the combined company, and Darren Westlake, our CEO and co-founder, will serve as Executive Chairman. The management team will include key leaders from both businesses. The combined company aims to deliver new innovations and products that will make it significantly easier, more affordable and valuable for ambitious businesses to raise growth finance, and investors will have an even greater selection of investment opportunities with richer investment tools.
Darren Westlake, CEO and co-founder of Crowdcube, commented: “Equity crowdfunding has redefined how many ambitious businesses raise investment and engage with their customers. Today’s agreement is an incredibly exciting milestone that will benefit high growth businesses, their investors who believe in their vision and the wider entrepreneurial ecosystem that supports them. Together with Seedrs, we can accelerate plans to further expand in the UK and overseas, launch innovative new products and improve our customers’ experience.”
Jeff Kelisky, CEO of Seedrs, said: “We are both fintech pioneers that have challenged the landscape of capital raising in Europe, building marketplaces for private equity investment. We believe that you need to be a player of greater scale to serve companies and the investors who support them. 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. This will not only create value for ambitious companies and their investors, but also for the economies and communities that they serve. As we look to the future, we’ll be well positioned to build on our combined strengths and create a powerful global private equity marketplace that will transform the ecosystem of equity finance globally.”
As the two leading investment platforms, we’ve both played a key role in Europe’s fast growing equity funding ecosystem, both through our success of primary raises through crowdfunding and the scaling of our secondary offerings and wider marketplace initiatives. Since 2011, £2 billion has been invested in campaigns on Crowdcube and Seedrs. Together we’ve helped more than 1500 companies secure investment, including BrewDog, Revolut, Perkbox, and in the last 6 months we have both seen significant milestones reached such as Crowdcube’s campaigns with what3words and Moneybox, two of the most popular equity crowdfund campaigns ever, and over £1 million of private company shares traded in a single month on the Seedrs secondary market.
The merger will be structured as an acquisition by Crowdcube of all of the outstanding share capital of Seedrs Limited via scheme of arrangement. Existing Crowdcube shareholders and option holders will own 60% of the combined company, and existing Seedrs shareholders and option holders will own 40% of the combined company. The merger ratio reflects the approximate valuations of the two companies based on each of their most recent fundraising rounds.
Before the merger is formally completed, we will need to go through an approval process with shareholders, the Competition & Markets Authority (CMA) and the Financial Conduct Authority (FCA). This is standard practice for this kind of transaction. The initial phase of the CMA process will take about two months, after which the CMA will either approve the transaction or move it to phase two of the process; phase two could take six months or possibly longer. During this time, both businesses will continue to operate as usual.
Following completion of the merger, the companies will work together to define how the two businesses will combine their teams, customers, brands, services and technologies. The transaction is expected to be completed in late 2020 / early 2021.
As soon as there are any further updates on the integration process, that may result in a change to the Crowdcube experience, we will, of course, let you know.
In the meantime, we thank you for your continued support, and we look forward to you joining us on this next exciting phase of Crowdcube’s growth.