60-second start-up: Crowdcube

60-second start-up: CrowdcubeMonday, February 21, 2011 by Rebecca

Luke Lang is the co-founder of Crowdcube, a brand new firm aiming to shake up the venture capital scene by changing the way small companies are 'matched' to VCs and angels. Here's the 60-second overview.

0-5 seconds: Sum your business up in a sentence
Crowdcube enables UK-based entrepreneurs to raise venture capital for their business, by getting investment from ordinary people in return for equity.

5-10 seconds: What's the business model?
Crowdcube is based on the principle of 'crowdfunding', the web-based notion whereby a large number of people pool their money in support of an idea, person or business.

10-15 seconds: Who are your competitors?
Other traditional methods of raising business finance compete with Crowdcube's model. These include banks, business angels, VCs and government grants. They tend to be a difficult way of raising cash however. Banks adopt a no-risk approach to lending and venture capital funding can be hard to access. We aim to change this.

15-20 seconds: What's your USP?
We bridge the current funding gap by democratising business finance, giving ordinary people in the UK the opportunity to invest in great businesses. Crowdcube is the next generation of business finance, by-passing existing funding institutions.

20-25 seconds: How have you funded it so far?
We're privately funded. Ideally we would have liked to crowdfund our start-up but there wasn't any means of doing this, which kind of proves our concept.

25-30 seconds: What were you doing before?
I ran a successful marketing consultancy specialising in business-to-business and digital marketing.

30-35 seconds: Where did the idea come from?
My co-founder and I have experienced start-up funding challenges first hand and we knew that there had to be a better way.  Dragons' Den was an inspiration. If we could find a way for ordinary people to become armchair dragons we could give British entrepreneurs a much needed boost. Rather than finding one high net worth individual to invest say £50,000, we make it easier for 1000 people to invest £50.

35-40 seconds: What's the smartest thing you've done so far?
We knew that the biggest challenge was going to be overcoming the regulations so we engaged expert's in regulatory and financial law as soon as possible. Ashford LLP's Commercial Team was fantastic and played a key role in developing the legal framework that underpins Crowdcube's innovative and unique model for crowdfunding and business equity.

40-45 seconds: What's the stupidest?
Moving into a Castle without heating! The Castle was fantastic but the office was freezing even in the summer and we only lasted three months. We had to wear thermals, bobble hats and fingerless gloves - not good for productivity.

45-50 seconds: If your business was a biscuit, what would it be?
Jaffa Cake. Not only do they taste fantastic but it is also the least dangerous biscuit according to a recent survey by MindLab.

50-55 seconds: Which idea are you a bit jealous of?
Kickstarter is a US-based crowdfunding website for creative people.  They were the first to take crowdfunding mainstream and have gone from strength to strength raising $27m for US creative projects in 2010. They are a truly inspirational example of the power of crowdfunding.

55-60 seconds: Where are you going to be in 12 months' time?
We're getting lots of interest from people who want to partner with us from across the world and we are looking forward to exploring these opportunities in 2011 and taking Crowdcube global.

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