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Crowdfund your Fintech: The Art of Asking

By Sashreka Pillay

Sashreka Pillay

The title is a shameless reference to the 2013 Ted Talk by Amanda Palmer. During the expertly woven speech, Amanda Palmer reflects on her time making a living as a human statue while sharing her observations on the exchange of giving and receiving. She then relates how she applied this thinking to crowdfunding her solo album. The result was $1.2 million in funding even though the goal was only $100 000.

What made their campaign so successful? According to Amanda, it was the emotional connection created when patrons chose to contribute to the band’s success and the enforcing of this connection through the exchange of giving and receiving. It made them different. It made strong supporters of industry influencers. It helped them build a community and extended the reach of their brand.

This is a really intriguing concept to apply to fintech. The growth of the fintech industry is one of the few which is underpinned by a very social community. It means that there is opportunity to build authentic emotional connection with your network through new mediums (of which crowdfunding is an one avenue) but be mindful that you are competing with thousands of other firms striving to achieve the same.

In researching this piece, finding fintech firms turning to crowdfunding as a capital source was not as easy as I’d imagined. This may be due to the current VC darling status firms are enjoying, that it’s not top of mind for firms or that SEO has crowded out results firms seeking for crowdfunding and replaced them with their fintech counterparts building the crowdfunding infrastructure upon which they list their funding goals.

Whichever way, I’ve selected some examples from a seemingly scant pile and invite you to share information on any others you find interesting:

  • Monzo: The company ran more than one funding round. The company closed pre-registration for their latest round in March 2017. Their goal was to raise 2.5 million GBP over two weeks. Seems like a pittance compared to the 12 066 480 GBP pledged by 41 267 people. That’s a lot of first tier influences.
  • MyCash Online: This fintech firm opted to pursue equity crowdfunding as a means to reach their financial goals. They boast reaching their goal in less than 24 hours after going live with their campaign. Their minimum funding target was RM 499,918 in exchange for 6.94% equity and reached a total of RM 1,299,797 with a total of 16.25% offered.
  • Squirrel: Despite a bit of investigative work, information on the SyndicateRoom page for this campaign is listed as “...not available to the public.” Interesting. From what I can find, Squirrel was in the fortunate position of having a track record in the market at the time of launching their campaign. The company ended their campaign with 585000GBP, well in excess of their 400 000 GBP goal.

In each case crowdfunding created excitement, it evoked feeling. It created a large number of vested advocates of the firm’s mission. This on top of reaching the firms company goals. It didn’t work for everyone and can’t be called the Holy Grail of building companies but I believe it’s a viable piece of arsenal to be considered.

P.S. In writing this piece I’ve learned a lot about the extended benefits of crowdfunding and a few tips and trips which contribute to success. Email me at  if you find this interesting and would like to receive a follow-up article.

Resources and References:
https://www.crowdfundinsider.com/2017/03/97794-fintech-startup-squirrel-completes-syndicateroom-funding-round/
https://www.equity.pitchin.my/businesses/mycash-online-bkash-fintech-malaysia-sdn-bhd
https://monzo.com/blog/2017/03/14/12000000/
https://www.ted.com/speakers/amanda_palmer

 

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