Seedrs launches financial intermediaries programme following successful quarter

Seedrs has signalled a new programme today (October 31) to introduce financial intermediaries and their clients to the equity crowdfunding space.

The aim is to offer cost-effective, digital alternatives to the EIS funds and offline deals that have, historically, been the first calling point for rich individuals looking for exposure to the early stage equity asset class.

In the last 18 months, Seedrs has seen an increasing level of interest from financial intermediaries looking for new opportunities for their clients who want to build their growth investment portfolios but are conscious of their clients paying excessive management fees.

Adam Reeve, investors manager at Seedrs, said: “Investors and advisers are more conscious than ever about fees eroding portfolio returns, and achieving growth.

“Self-directed execution-only platforms for traditional asset classes, such as listed equities and bonds, have existed for many years and are a common route for sophisticated investors who wish to construct their own portfolios, without paying significant management fees.

“Previously there has been little or no equivalent for private equities, particularly seed and venture investing with only structured, managed products provided only to HNW investors… Seedrs offers this service.”

Innovative product features, such as digital tax certificates, real-time portfolio performance and a secondary market, as well as recent commercial partnerships with RBS, Fidor bank and The Law Society, has drawn significant interest in Seedrs from the intermediary community.

45 per cent of angels interviewed by the UKBAA about their early stage equity investments reported high growth portfolios, and 63.9 per cent showed high or reasonable growth.

As a result, equity crowdfunding has become appealing to high-net-worth individuals because it offers access to a previously exclusive asset class with the potential of serious capital growth, diversification opportunities and the chance to support innovation.

Under the new programme, Seedrs offers intermediaries a non-advised solution for their HNW clients who are looking to build and manage portfolios of S/EIS qualifying investments, with the platform handling all legal and tax admin online with no ongoing management fees.

Thomas Davies, Seedrs’ chief investment officer, added: “Equity crowdfunding has become increasingly interesting to accountants, brokers and financial consultants.

“The Seedrs nominee structure gives advisers the peace of mind that their clients are investing on the same terms as professional VC firms, receiving voting [and] pre-emption rights, consent rights and tag along provisions to protect minority shareholder rights.”

High-growth portfolio companies on Seedrs include digital banking alternative Revolut (recently completed a $66m Series B round), English wine company Chapel Down (ISDX quoted), and accountancy software business FreeAgent (listed on AIM).

Furthermore, beauty-on-demand startup, blow LTD, recently received £7.5m from Debenhams offering Seedrs investors an exit opportunity after just one year at three times their purchase share price.

According to Seedrs, over £3.6bn was invested into 1,203 equity deals in the UK in 2016, of which 23 per cent of all equity investment was done through equity crowdfunding platforms.

The company completed 11 per cent of those deals, making it the most active investor in UK private companies.

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