Grant Thornton and crowdfunding platform FundedByMe enter partnership

Grant Thornton and crowdfunding platform FundedByMe enter partnership

Crowdfunding – when companies turn to a crowd of investors to fund projects or ideas – is growing rapidly. Now, auditing and consulting firm Grant Thornton in Sweden partners with the crowdfunding platform, FundedByMe, with more than 50,000 investors in over 160 countries. The success stories include – among many others – Berries by Astrid, Virtuos Vodka and Isbjörn of Sweden.

The purpose of the partnership for Grant Thornton and FundedByMe is to develop entrepreneurship and support companies in their startup phases. For Grant Thornton this primarily means offering valuation services to entrepreneurs, hence facilitating for entrepreneurs and investors to connect and close deals at the right level.

– We believe that FundedByMe’s digital service is completely in tune with the times and that crowdfunding will continue to grow fast, both in Sweden and internationally and especially among young entrepreneurs. We are happy that through this partnership, we are able to support Swedish entrepreneurs in need of funding and thereby contribute to growth, says Carl-Johan Regell, authorized accountant and partner at Grant Thornton Sweden.

We realized several years ago that we wanted to partner with big, established players in the market, in order to develop crowdfunding in the sharing economy. We feel that Grant Thornton, just like FundedByMe, operates in the spirit of companies with increasing growth, and with the right focus for the entrepreneurs and companies who turn to us. We are very happy to announce this partnership and we see Grant Thornton Sweden as a strong partner for the exciting journey that lies ahead, says Daniel Daboczy, founder and CEO of FundedByMe.

The partnership begins with advisors from Grant Thornton participating in different activities, which FundedByMe arranges for investors and entrepreneurs this fall. After that, the companies will draw advantage of their respective networks to help entrepreneurs grow.

Grant Thornton already supports well-known entrepreneurial sponsorships and networks, such as DiGasell, Founders Alliance, YEoS and SUP46.

For more information, contact:

Lisbeth Larsson, Head of Communications, Grant Thornton

T: 0708-21 71 56, 08-563 071 56

E: lisbeth.larsson@se.gt.com

Twitter: @GT:_LisLar

www.grantthornton.se/press

Twitter:@GrantThorntonSE

Lena Flykt Rosén, Head of Partnerships, FundedByMe

T: +46702-86 66 12

Email: lena@fundedbyme.com

www.fundedbyme.com

About Grant Thornton Sweden

Grant Thornton Sweden is one of the fastest growing audit and consulting firms in Sweden. With more than1100 employees and 23 offices, the company is an independently owned and managed member firm of Grant Thornton International Ltd. The member firms provide audit, tax and advisory advices.

Grant Thornton” refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton International Ltd (GTIL) and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate, one another and are not liable for one another’s acts or omissions

About FundedByMe
FundedByMe is a leading international player in crowdfunding through equity, loan or reward. The company has successfully funded hundreds of companies from 25 countries. The members represent a rapidly growing network of more than 57,000 investors from over 160 countries. FundedByMe with headquarters in Sweden has a presence in countries around Europe and in Singapore.

The art of company valuation

The art of company valuation

One of the most common question we get is “How do we valuate our idea or business” or “How can I know if this company is correctly evaluated”.

How to correctly assess the value of a company is virtually impossible. A good valuation to one person might be seen as hideous by another. FundedByMe will never judge the valuation of any of the companies seeking capital through its system, however, we can try and educate our visitors, enabling them to make smarter decisions.

Rule No 1.

The correct market price is what the market is willing to pay. This does not mean that the market is correct in its assumption regarding future returns or growth in asset values. The well-known US investor Warren Buffett put it correctly when he stated: “Price is what you pay. Value is what you get.”

So, it is hard to judge at the time of investment whether or not you will see your fortune melt away or grow at a tremendous rate.

Rule No 2.

Remember that the offerings on FundedByMe has been priced by the seller, not through a market-driven process. Even though the so-called pre-round exists for the reason to let prospective raisers of funds get feedback from potential investors, there is no guarantee that insights gained through the pre-round results in a correctly priced offering.

Rule No 3.

Always remember why you invest. At FundedByMe we like to talk about Value From Investment (VFI), which is all those things you get out of your investment. Financial returns can be one, but it might also be the joy of supporting an individual you like, a context to exist in, a good story to tell your friends, products you like, possible discounts, etc.

Rule No 4.

You are solely responsible for any investment decisions. It is risky to invest in unlisted stock. You might never see your money again and it can be hard – not to say impossible – to sell stock in such companies. But then again, some will make it big and pay back handsomely.

Rule No 5.

Be prepared to loose everything.

That being said, the question remains how to correctly assess the value the entrepreneur says his or her company has. Rest assured that the entrepreneurs are optimistic – that is why they became entrepreneurs in the first place – but sometimes their expectations seem sky-high.

Please bear in mind that many of the companies on FundedByMe seek funds in order to grow, sometimes very aggressively. High growth affects the future value of a company very positively.

Other factors, besides growth, you should look for are:

–       Cash flow

–       Margins

–       Strategic position and potential in their sector

–       The existence of patents or trademarks (can be very important)

–       The team (most early stage investors would say that this the only thing they are looking for)

–       Realistic expansion plans

–       Competition

–       Risks they are facing

–       Traction (high growth in user base, increasing sales, press reports, etc.)

Please also think over what you, as an individual, can bring to the table. After all, crowdfunding is only partly about the funds a company can raise. It is also about the networks the companies can amass and as an investor you are part of that network.

Your own individual experience from a sector or a specific type of investment might guide you well but please also be an active information seeker, for instance through the Internet, but also by asking other FundedByMe investors. Crowdfunding is, after all, all about the crowd.

If you want to drill down into specific valuation models, there is a vast territory to cover and we at FundedByMe will not recommend a specific one. Rather, read books, blogs and news reports. One good book to start with is “The Financial Times Guide to Valuation”:

http://www.amazon.co.uk/Financial-Times-Corporate-Valuation-Guides/dp/0273729101/ref=sr_1_3?s=books&ie=UTF8&qid=1367232773&sr=1-3&keywords=The+Financial+Times+Guide+to+Valuation

It has been written by David Frykman and Jakob Tolleryd, who themselves are Internet entrepreneurs and investors.

Please also note that valuations differ enormously from sector to sector and from time to time. To get a hunch of what the situation is like right now you can always try and compare key numbers with those of listed companies in the same sector.

Daniel Daboczy – FundedByMe

Virtuous Vodka raises 1M SEK in less than 8 weeks

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A phone call made by Claes Stenmark, co-founder and CEO at Virtuous Spirits AB, last summer to FundedByMe’s office in Stockholm was the beginning of an adventure which would eventually lead the company to a fully financed round of equity crowdfunding, while simultaneously becoming the first ever company in the tech-savvy nation to accomplish this.

Claes Stenberg Virtuous VodkaWhen the phone call came in, Sweden’s largest crowdfunding platform FundedByMe, had just announced their plans for a pivot towards equity crowdfunding and was starting a period of extensive testing in stealth. Virtuous Vodka was the first company on the platform when it went into pre-round on 1 September 2012. A company in pre-round has access to a set of powerful tools in order to validate ideas, market value and connect with potential investors. In the same pre-round potential investors are able to report their interest in investing in the company, the entrepreneur, however always keeps control over who can ultimately invest in the company. 

Not more than 8 weeks ago the company opened their round, allowing the crowd to invest in the ambitious vodka brand. And the crowd did. FundedByMe has found in Virtuous Vodka the perfect partner to pave the way for many other ventures interested in using equity crowdfunding for financing their businesses. Claes and his team have worked out a bullet-proof campaign with a personal touch, and succeeded in closing their round by being dedicated and able to engage a large number of (potential) investors. By hosting monthly tasting sessions, inviting their investors to spread the word and taking the time to speak with every investor they quickly gathered a crowd of engaged investors, which the company is proud of.

Last Friday, on 11 January, the goal of 1 million SEK was reached and Claes closed the round on FundedByMe’s platform. In a first response Claes Stenmark states, “We are extremely happy and proud to be the first ever company in the Nordics that closes a fully funded equity crowdfunding-round!” He continues, “The capital raised (SEK1 million) will come in handy, but the key is that we have more than one hundred key members who will be good ambassadors, contributing with their skills and their networks. These brand ambassadors, along with the enhanced cash, will help make a greater impact with our first product launch. This spring, the naturally flavored series of Virtuous Vodka will take the Swedish market by storm. We are confident that the market, just like us, crave the authentic taste!”

Running a successful campaign isn’t simple, there is a lot to it. Virtuous Vodka however has set a good example and will serve as inspiration for many other fellow entrepreneurs throughout the Nordics. FundedByMe is excited about the traction on the platform which shows a conversion rate of 62% and an average investment of SEK 9710:- per investor. A large number of investors have invested in more than just one startup, which provides promising conditions for future startups which will be featured on the company’s platform.

FundedByMe re-launches Equity Crowdfunding

FundedByMe Equity

Just a few days ago, after weeks of coding and testing, we re-launched our site. The most obvious difference is our shifted focus towards Equity Crowdfunding, catering to future startups with a very powerful tool to manage campaigns, shareholders and legal matters.

Crowdfunding has been around for a while, centuries actually, but will only in 2013 really take-off into super overdrive. It is probably one of the business models which makes the most sense, where some people might have plenty of money left to spend on small investments others are full of great ideas and in desperate need of funding. Puzzling is much easier with a lot of small pieces.

Where we live in a society which is rapidly moving away from the traditional corporate structures and in which we more and more started embracing small and young initiatives many entrepreneurs have a hard time landing a serious round of funding as there are simply not enough traditional investors to fill the need! This however should not be a reason for stopping this movement away from the traditional corporation, and that’s why equity crowdfunding is an essential part in this revolution.

There are other reasons to turn to equity crowdfunding as well. Being a young and small company it is often hard to own all knowledge needed to start and grow your company, many different small investors however allow you to take on a wide range of talent in all fields where you are missing out initially.

We have run a first campaign with Virtuous Vodka, a brand who has chosen to use FundedByMe for two main reasons:

1) Get market validation and turn every small investor into a brand ambassador
2) to source all the knowledge which all investors own together, ranging from online marketing to development.