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“The wisdom of the crowd”

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I have a business idea and need funds, where do I go?

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Friends, Family & Fools?

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Bank?

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Venture Capital, Business Angels, Government?

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How many people find themselves in this situation?

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Benefits of asking the crowd for funding• Lower costs of raising finance• Global reach for investors• Free Marketing costs for idea testing• Transparency

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Benefits of investing through crowdfunding• Higher returns• Better spread of risks• Ability to participate in otherwise unknown ideas• Feeling of involvement in the idea• Better information than traditional ‘due diligence’

methods

CrowdAheadCrowdAhead“Crowdfunding Industry Report”1

• $1.5 billion was raised globally in 2011 through crowdfunding

• $584 million was raised in Europe in 2011• Reward-based crowdfunding is the largest category• Equity-based crowdfunding is the fastest growing • General crowdfunding annual growth rate 63%• Equity-based crowdfunding annual growth rate 114%

1 crowdsourcing.org – May 2012

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Reward-based

Return: not financial

Crowdfunding flavours

Equity-based

Return: equity

Loan-based

Return: principle + interest

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CrowdAhead’s intentions• Establish first in UK• Initially focus on equity-based crowdfunding• Raise £200,000 in 2 phases until platform is self-

funding• Go live in January 2013• Cash-flow positive by end of 2013• Positive cash balances by end of 2014

CrowdAheadCrowdAheadCrowdAhead’s revenue streams

• Success fee only – set at 5%

• Possible future streams• Listing fees• Affiliates• Advertising• Added services

CrowdAheadCrowdAheadThe crowdfunding market (July’12)• $1.5 billion raised in 2011 of which $ 584 million in

Europe• Growth rate: 63%• Growth rate equity based crowdfunding: 114%• Equity based crowdfunding only possible in Europe at

the moment – not in the US until 2013• Expectations:

“crowdfunding market could reach $300 billion and will be largely driven by families and individuals investing a small percentage of their assets directly into ventures”2

2Fred Wilson, co-founder of the venture capital firm Union Square Ventures (which has invested in Twitter, Tumblr, Foursquare, and Zynga)

CrowdAheadCrowdAheadIn the United Kingdom:

204,000 new companies formed in January - June 2010http://www.bbc.co.uk/news/business-11535932

4,500,000 Small Businesseshttp://www.fsb.org.uk/stats

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Why CrowdAhead?• The concept• The market• The people• The future

The wisdom of the crowd