The future of the past of Technology?

There is a lot of talk about the future of technology, but one of our current campaigns wants to celebrate the past. Showcasing collections of technology relics alongside up and coming future tech. They want to create a meeting point, an homage to games past, as well as supporting the technology community in New Zealand.

"It's great to go back to your childhood and show your kids the games 
you used to play. Each of these pieces has its own amazing backstory of 
people who worked long hours to bring the technology into being." 
says Mark Barlow, the main collector and instigator of this campaign.

Techvana have already exceeded the $50,000 mark, but need to raise $250,000 to set up their company and grow.

They’ve gotten a bit of media attention:

As well as a lot of support. They’ve crowdsourced crew to set up the museum, mounting exhibitions through to running Singles Speed dating Night for Geeks (which is on the 27th!).

But what they need now is investors. People that see the vision, and want to be part of the base of shareholders that want to green light this museum and make it a part of Auckland’s history as well as part of it’s future. Check them out here.

Crowdfunding Crowdfunding: Episode I

We love crowdfunding so much that we are walking our talk to crowdfund ourselves! We just launched our very own equity crowdfunding campaign so we can grow and you can own a little part of us (Anna’s elbow or perhaps my left knee).

Equity crowdfunding is a new thing for us, PledgeMe only got its license a few months ago. We’ve worked with over 40 companies on equity campaigns, with one currently raising. Now, we’re walking the talk, giving our crowd a chance to get involved, and to show anyone thinking about doing equity crowdfunding what they’d need to think about before embarking on this track.

So here are some thoughts about the things we’ve found tricky or had to do a bit of work on before going ahead with the campaign.

Valuing yourself

Valuation is a tricky one. There are so many models for figuring out valuations (from discounted cash flow to asset valuation to market comparatives to the Berkus method). We needed to make sure the valuation made sense to our crowd (from our Board straight down to Anna’s best friend). It’s got to give investors a good deal and at the same time ensure your company gets enough capital to see through its growth plans. That balance is hard to find. Over on his blog, Rowan Simpson offers some good advice:

“Try not to get bogged down in this, whether you’re an investor or a founder. At the end of the day neither side wins because they eked the last percentage point of dilution out of a funding round negotiation, they win by working together to build a fast-growing ass-kicking name-taking business.”

In that spirit, we see ourselves as a fast-growing ass-kicking name-taking business. Our share price and minimum buy are definitely in favour of attracting investment from our crowd, but is going to allow us to go mobile and expand our team to grow the business even faster. Check out our financials here.

Conversations with your Crowd

Anna leaned across the table to me, and in a casual tone asked “Would you invest in PledgeMe?”. The answer was of course yes.

I’ve been a long time supporter of PledgeMe and have seen heaps of friends get projects off the ground because of crowdfunding. Now working for the company and being a good friend of Anna’s, I want to invest in the company to help ensure its success and place in NZ’s vibrant crowdfunding scene. And, I want to be part of the upside if it comes.

No doubt each of you will have similar people around your company or idea. We recommend making a list of 50 people you think have the money or inclination to invest in your company and personally contact each of them. This can be a daunting project, but I can see Anna dutifully making her list now and starting to follow up with her crowd.

It’s a daunting prospect, but pulling in your crowd is absolutely essential. It ain’t crowdfunding otherwise!

Creating a pitch video

Even though I once starred in a 48 Film Festival film, PledgeMe didn’t have quite enough internal experience to patch together a pitch video. Luckily we had the support of our crowd. We called in the big guns with two times successful PledgeMe user Julia Campbell, and Ro Tierney a friend of our crowd. They helped us put together this slick video which clearly explains why you should invest in PledgeMe.

We recommend keeping your video short, definitely less than five minutes (if not less than 90 seconds) and only putting essential info in there to give your company a bright and cheery human face and show what you’ve done (over just telling in text). All the complicated stuff should be left for the business plan and financials.

Here’s how we laid out our pitch video when we planned it. We shared the plan with our team and commented / live edited / perfected the wording in Google Docs over a few days. You need to make sure your pitch isn’t too long, and that it sounds good when you speak it out. Then we created photoshop visuals for the film-maker based on the script, and listened to a lot of music on Audio Jungle.

On shoot day we went through the script one more time, ate pizza, and tidied our desks… And, our office chairs might never be the same again – Ro turned from film-maker into set dresser moving chairs, boxes, and potted plants to make sure the shots he took looked good (we’re still returning the chairs back to their owners – days later).

The real magic happened in the edit. Ro turned our ideas into reality, tweaked the visuals, and after a few drafts back and forth (in our Google Drive) we had our final video ready to upload to Youtube. Check it out:

Compliance

We were in a tricky situation trying to crowdfund ourselves using our own platform. Luckily we negotiated through the FMA’s rules and have made it so we can run this campaign. This has meant Anna has had to step away from the campaign and crowdfunding consultant Kat Jenkins from Multitude has stepped up to run the campaign with support from our legal team at Buddle Findlay, Virtual CFO at Deloitte and the oversight of our independent Director, Anake Goodall. Also, people like me (aka “Associated Parties”) need to get formal approval to invest, and will get listed on the websites interest register.

While this is something you won’t have to think about, other areas of legal compliance regarding what to do with your new shareholders is something you should be taking into account. There are reporting requirements (annual, financial, and audit) as well rules for any company that has over 50 share parcels issued (The Takeovers Code). There are also certain instances where you’ll need a special resolution passed (eg. 75% of your shareholders voting yes). Most of this is just good company hygiene, but when your crowd is involved you want to make sure you’ve got your dry-cleaned suit and best perfume on.

What if it ALL fails!?

That dreaded thought that runs through everyone’s mind when they push ‘publish’ on a PledgeMe campaign.

We are incredibly optimistic that our campaign is going to go really well. We’ve got a huge crowd behind us, a solid track record of success, and wide networks of people who we know are ready to pledge.

In your case the best way you can ensure success is to make sure you activate your crowd and get them buzzing about investing in your company. That’s what we’ve done. So Anna, our board and I are just going to cross our fingers, take a deep breath and plunge into this campaign.

Check out our campaign here and get investing!

We’ll have Crowdfunding Crowdfunding: Episode II here soon.

Startup Garage meets PledgeMe and AngelHQ

Last night PledgeMe hosted Startup Garage at our Wellington office. Startup Garage is a regular meetup where people talk about startups, tech and the entrepreneurial lifestyle. This time the group took a look at two kinds of investment Angel and equity crowdfunding.

Photo Cred: @BekaWhale // BizDojo

David Allison, Manager of Wellington’s Angel Investment Club AngelHQ, spoke about the idea of angel investing. Turns out it’s an age old idea — people stumping up cash and resources to help a business start up — just that the term “angel” is a newish one that came out of the USA a while back.

AngelHQ operates as a club of individuals all of who have experience and capital and are looking to get something out of the investment. They’ve been around for a few years in Wellington and have invested about $8 million into 34 companies which cover a range of industries.

You can find out more about the club here.

Then Anna talked about PledgeMe’s new equity crowdfunding option, explaining that she set off on the PledgeMe journey wanting to create a platform that allowed to fund things differently.

Crowdfunding is a young place, not just in terms of the platforms only being a few years old, but in terms of the people who are using it. We’ve had a group of 9-year-olds use PledgeMe. It’s also a growing market. There are now over 1000 crowdfunding platforms worldwide with a steady amount of money being raised through them.

Anna talked about the very new idea of equity crowdfunding, companies going out to their crowds and bringing them in to make them not only shareholders, but champions of their business. The basics of why and how you could run an equity crowdfunding campaign. More info on that for those who missed the talk here.

There was a lot of interest from the crowd about how equity crowdfunding works with questions about the ins and outs flying thick and fast. Which is great because one of PledgeMe’s goals over the next while is to better educate entrepreneurs and business about how it works so they can take advantage of our platform to harness their crowds.

If you’re keen to come along to more Startup Garage events check out their Meetup page here and for other events around startups, business, and tech check out Built In Wellington’s events calendar.

Launching with a Crowd

PledgeMe is really proud to announce that our first equity campaign went live yesterday, and we’ve published our second today.

While at first glance the two companies are very different, they both have passionate founders who want to bring their crowd into their companies. Be it tech enthusiasts or Twizel natives, these companies cater for a wide spectrum of customers and offer exciting investment opportunities.

We’re excited about that. We’re excited that any company can try and crowdfund an investment round — and that the crowd gets to decide if they make it or not.

Now, let us introduce our two companies – Techvana and H2 Explore:

TECHVANA

With the help of computing enthusiasts nationwide, and the support of tech giants like Steve Wozniak, husband and wife team Mark and and Katie Barlow are working to create New Zealand’s first dedicated computer museum. Techvana – The New Zealand Computer Museum will bring together a massive display of computing, gaming, telecommunications and robotics technologies, sourced from fellow collectors throughout New Zealand.

Shares in Techvana are affordable because they want a thriving crowd to support the museum and be passionate about New Zealand’s tech history. Check out their campaign here.

techvana.jpg

 

H2EXPLORE

One word: hovercrafts. That’s what H2Explore are going to be bringing to Twizel. They’ve gained exclusive consents to start a hovercraft transport business over the Tasman River and Lake Pukaki. With over 7500 cyclists expected to do the Alps 2 Ocean Cycle Trail next year and the booming tourist numbers this campaign has the potential to scale fast if you become part of their crowd.

Check out their projections and business plan here.

We’ve got another couple of companies getting ready to launch soon. So keep an eye out for some more equity crowdfunding campaigns coming your way.

Equity crowdfunding: we did it.

Wow.

It’s crazy that it’s the end of July already. This licensing journey for equity crowdfunding took a bit longer than we anticipated — but we did it. We’re totally stoked to be one of the first licensed equity crowdfunding platforms off the block!

In a way it’s really good that the FMA took a while working with us to finalise the license, we’re building a new industry and we need to be ready for anything.

And we are ready. Our new design for equity is ready to go (sneak peek above). We’ve got a variety of companies interested in launching with us, and some good media coverage of the changes — including this TV3 piece. After four months work it all fits. PledgeMe projects and PledgeMe equity are inter-related: it’s all about kiwis funding things they care about. Be it projects or companies.

So what’s next?

We’re going to hard launch on the 15th of August — with a bit of fan fare up and down the country. CAUTION: THERE WILL BE PARTIES and you will all be invited to join in the festivities. Keep an eye out here and on our Facebook and Twitter for more details.

In the meantime: if you’re interested in joining the growing crew of companies that want to launch with us, drop us a line. You’ll need to be ready to provide:

  • Descriptions of your company, team, what you’ll use the growth funding for, and your future plans
  • Your current financials, and forecasts (as a pdf)
  • A draft business plan to attach (as a pdf)
  • Your valuation (and an explanation of your method)
  • Your minimum and maximum funding goals

Once that info is on our system, you’ll need to get all of your directors to sign the issuer agreement confirming that you’re all on board with the campaign, and that we can complete the required background checks.

If you want to start investing in companies then keep an eye on PledgeMe on the 15th of August. We think you’ll like what you see. But don’t forget – the first pledgers on any campaign will probably be the family, friends, and customers of the company first, followed by a wider crowd if it strikes the right chord.

We’re excited to be changing the face of the financial markets AND crowdfunding in New Zealand — one start up (and stay up) at a time.

Key Facts about Equity Crowdfunding

  • Maximum Raise:   $2 million (per 12 month period per company)
  • Average raises overseas:   $80,000 – $120,000 for equity stakes from 10-20%
  • Legislation:   Equity crowdfunding was legalised under the Financial Markets Conduct Act 2014 – that came into play on 1 April. Companies are required to run their campaigns through licensed intermediaries (like us), and still need to comply with other legislation (reporting, Takeovers Code etc).

Our Facts

  • Launched:   February 2012
  • Number of users:   35,000+
  • Money raised to date:   $2.5m+
  • Number of projects funded:  640+
  • Largest campaign: $206,000 for Back the Bull (+ matched funding taking the total to $700k+)