Five entrepreneurs who’ve cracked crowdfundingJune 11, 2014 1:20 pm
Until recently, turning a business idea into a reality would usually involve approaching a few investors and asking for large sums of money to get your venture off the ground. Crowdfunding has turned this method on its head by using the power of the internet to get thousands (and in some cases, millions) of people excited enough in your idea to help fund it. From films, video games, and apps, to the first affordable smart watch and even the world’s first wireless in-ear headphones, we are now seeing more and more crowdfunded projects come to fruition which may never have seen the light of day a few years ago.
Crowdfunding works in a similar way to donating. Budding entrepreneurs can create an online pitch to explain their business idea and appeal for small amounts of funding from anyone who is interested in it. So instead of relying on one big investment from a single source, entrepreneurs can appeal for microinvestments or donations from many individuals across the world.
In 2009, Brooklyn based Kickstarter, pioneer of the crowdfunding model, was launched in the US, and eventually opened its doors to projects in the UK in 2012. Following its huge popularity, new sites started to emerge such as Crowdcube and the UK’s largest crowdfunding network Crowdfunder, which has launched more than 3,000 projects and helped raise over £1.5m in investment.
Often, people will invest simply because they believe in the cause or idea. Rewards for those who do invest can vary. Some will receive their money back with interest if the project is successful, whilst others can expect free gifts or public acknowledgement.
From fruit jerky innovators to Britain’s youngest crowdfunder, we take a look at five British entrepreneurs whose unique and inspiring crowdfunding pitches have caught the attention of investors from around the world:
1. Snact: 100% fresh fruit jerky, 113% success
Snact is the brainchild of two friends, Michael and Ilana who had a vision to make healthy snacks from surplus fruit to help take action against food waste. As the business grows they also plan to employ people who have been affected by food poverty. Using Crowdfunder this fruity business caught the attention of 273 backers, who between them pledged £13,516 allowing Snact to reach 113% of the original target. Supporters were offered rewards ranging from bags of Snact fruit jerky to t-shirts and books.
2. Front Up Rugby: the fashion line that’s in a league of its own
After receiving huge support and backing from the public, British rugby inspired fashion label, Front Up Rugby, have exciting times ahead. Uninspired and frustrated by the lack of choice in men’s rugby fashion, founder Jon Allen, turned his love for the sport into a business venture with the help of Crowdcube. Initially, Front Up Rugby raised £100,000 but went for a second round of fundraising after it oversubscribed. As a result, an additional £23,000 was raised to satisfy demand.
3. Zero Carbon Food: growing underground
Backed by celebrity chef Michel Roux Jr, Zero Carbon Food’s unique environmentally friendly concept uses London’s abandoned underground spaces to grow sustainable herbs and vegetables. Using LED lights and a hydroponics system, childhood friends Richard Ballard and Steven Dring found a way to feed the growing UK population without using any carbon and by having no dependency on fossil fuels. With the help of Crowdcube and support from the likes of Michel Roux Jr, Zero Carbon Footprint’s pitch gained momentum and rocketed past it’s original target of £300,000 with 487 investors helping them reach a total of £596,560.
4. Cracking Good Recipes: Britain’s youngest crowdfunder
At just seven years old, Dylan Allman proved that whatever your age, if you are passionate enough about an idea you can make it happen. Dylan was crowned Britain’s youngest crowdfunder when he raised over 166% of his £450 target to get his Cracking Good Recipes book published. With some help from his mum Lorraine and celebrity support from the likes of Aardman Animations and TV chef Ainsley Harriott, Dylan’s book has since raised over £1000 for charities of his choice.
5. Chilango: spicy success
Sharing a passion for Mexican food, Eric Partaker and Dan Houghton decided to leave their jobs at Skype to embark on a culinary adventure and spice up the UK with the tasty cuisine. From this partnership Chilango was born – a London chain of seven Mexican restaurants serving award-winning burritos, tacos, salads and more. Using Crowdcube’s platform, Eric and Dan decided to raise money to help roll out more restaurants across the capital with what they called their ‘Burrito Bond’. The support came flooding in and they reached 115% of their target with some big investors including the former MD of Jamie Oliver International and CEO of Krispy Kreme UK.