Braveheart and Crowdcube set up crowdfunding co-investment fund

The vehicle will be managed by Braveheart subsidiary Strathtay Ventures, while Crowdcube will source investments for the fund.

CVF is designed to provide a way for an individual to build a portfolio of crowdfunded assets without the individual having to carry out due diligence and invest personally and separately. The fund will provide capital for start-ups that have received at least a third of their target amount through crowdfunding on the Crowdcube platform.

Investors of the fund are able to subscribe or top up their commitments at any point over the two-year investment period of the fund. The minimum subscription for investors of the fund is £2,500.

CVF will seek to invest predominantly in companies that are registered for enterprise-investment-scheme (EIS) and seed-enterprise-investment-scheme (SEIS) tax reliefs. The fund will aim to generate returns from several exit strategies, such as IPOs and trade sales.

The establishment of the fund lends credence to the current worries that a growing number of crowdfunding platforms may be diverting cash that would have otherwise been earmarked for private equity funds.

Crowdcube is an equity crowdfunding platform, meaning investors receive shares in the companies they back rather than receiving incentives such as a product for backing a company, as is common with typical crowdfunding sites such as Kickstarter.

According to Crowdcube, it has raised more than £17.5m from 57,000 members for 90 UK businesses since 2011. The platform also claims to have raised £12.2m for 54 UK companies in 2013, representing a 500% growth rate from 2012. The company was founded in 2010 by its CEO, Darren Westlake.

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• Topics
• Funds
• UK / Ireland
• United Kingdom
• Braveheart Ventures
• Crowd funding