Venture Capital News: Crowdability Lands $1M Seed Round
2014-06-12
NEW YORK, NY, World's first independent research service targeting the $300 billion market for equity crowdfunding, is formally launching today and announcing a $1 million seed-round of funding.
Imagine investing in blockbuster companies like Facebook or Google before they were publicly traded:
It's estimated that Google's earliest investors made 3,000% on their investment when Google went public.
Inspired by these types of returns -- but aware that individual investors need help navigating these waters -- Crowdability is formally announcing its launch today.
Crowdability is the world's first independent education and research service targeting the $300 billion market for equity crowdfunding.
Equity Crowdfunding refers to online fundraising where everyday citizens write small checks to start-ups (from a few hundred dollars to, say, $10,000), and in exchange, they receive ownership stakes in these companies.
Rewards-based crowdfunding sites like Kickstarter, where contributors might receive a T-shirt or an early version of a product, have been around for years. Now that individual investors can receive equity in 'the next Facebook' or 'the next Google,' the market is set to explode.
Crowdability aims to inform and protect these individual investors.
When Crowdability's founders, Wayne Mulligan and Matthew Milner, first heard about the 'JOBS Act,' the new legislation that makes crowdfunding possible, they recognized the positive impact it could have on start-ups, investors, and the economy.
But, as Wayne said, 'We also recognized that, if not properly educated, individual investors could lose a lot of money.'
Both Wayne and Matthew have extensive financial and start-up experience.
In addition to his early career at investment banks like Bear Stearns and Lehman Brothers, Matthew more recently served as Entrepreneur-In-Residence to Hearst Magazines, after the publisher acquired an Internet company he'd founded.
Wayne's last business, a financial education company that served over 250,000 individual investors, was acquired by a global financial publisher in 2011.
Their shared passion for start-ups, and their experiences working with individual investors, led them to launch Crowdability.
Crowdability publishes a four-day-a-week newsletter. The content includes educational essays, as well as a digest of equity crowdfunding deals from across the web. Additional educational material and research reports can be found throughout the company's website.
To help investors learn the basics about start-up investing and crowdfunding, Crowdability just released a free 47-page Equity Crowdfunding Action Kit. You can find it here: http://landing.crowdability.com/
The company is also announcing today that it raised $1 million in seed financing. It plans to use these funds to build education programs and research services geared towards individual investors.
Participants in the round include Howard Lindzon of StockTwits and Social Leverage, and Steadfast Venture Capital.
Lindzon had this to say about the company: 'We were early investors in [equity crowdfunding platform] Angel List, and we've always believed that as equity crowdfunding became mainstream, a trusted source of research and education would need to emerge.'
He continued, 'Crowdability has the team, the integrity, the expertise and now the capital to fill this role. They've already made great strides. Now the Social Leverage team and I are excited to roll up our sleeves and speed up their access to startups and the investment community.'
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