bigfoot12
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Post by bigfoot12 on Jan 31, 2015 14:41:22 GMT
There are a few posts on here about Property Moose, and The House Crowd have a section but these are both equity investments (largely). Would Crowdcube and Syndicate Room have a place here? In any case does anyone know of a good forum for either of those?
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ramblin rose
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“Some people grumble that roses have thorns; I am grateful that thorns have roses.” — Alphonse Karr
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Post by ramblin rose on Feb 1, 2015 18:04:21 GMT
Doesn't seem to be as much crossover with them and p2p as you'd think - somebody tried to get this going on here a while back but there wasn't the interest at the time. I did a spate of crowdcube investing for a while (now got as much allocated to those types of investment as I want and it'll take a few years before they run their course) and tried discussing the merits and otherwise of my chosen pitches with a few forum members who I recognised the names of, but generally speaking they were not as comfortable with company investments as with p2p, and were just playing with small amounts in crowdcube. I'm very happy relying on my own instincts with regard to company investments, but it's always good to get other viewpoints.
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bigfoot12
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Post by bigfoot12 on Feb 1, 2015 19:37:04 GMT
I'm surprised that there isn't more discussion on here. I wondered if it was not allowed for some reason. I've been putting a little in for about 18 months with the idea that I'll hit my full initial allocation after about five years. Hopefully by then I should have some idea if any of them have been worth the risk and the time. I've put a lot of effort into choosing the ones I have invested in. Did you do the same ramblin rose or did you buy a larger diverse portfolio? The problem with the small portfolio that I have is that it would seem that only a small number are likely to make it big and it is those that account for most of a portfolio's return. I wouldn't expect that I'm better than average at picking - though I hope I will be one day. One thing I like is that I have share certificates and I'm not exposed to the platform I bought them on. Apart from Crowdcube, Seedrs and Syndicate Room have you heard of any other seemingly reputable places? |
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ramblin rose
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Post by ramblin rose on Feb 1, 2015 19:58:31 GMT
No, I didn't look any further - I'd heard that seedrs was even more biased towards freebies, so didn't bother looking there, and in the space of 6 months or so I'd found enough to interest me on crowdcube. I've spent many years picking and choosing my shares, both quoted and unquoted, and I tend to do lots of research and then go in fairly big in a smaller number of largish investments - it's riskier, but I'm reasonably confident, and overall I've built up a large spread over the years. So via crowdcube I invested in just 5 different companies in the end. One of them was a small investment, one smallish, two were medium and one was large. I'm about a year and a half down the line now and none of them have gone bust yet, but it's early days! 3 are making excellent progress, 1 is making good progress and the fifth might or might not be on the brink of it.
The problem I find is that the 'crowd' are attracted to shiny, sexy, internety things and things that give them free stuff. So those types of company get funded quickly, whereas good, solid businesses that do quite tedious things that make good regular money and don't give you anything free but which stand a sensible chance of making you real money down the line don't attract the magpies. That means those businesses quite often don't reach their funding target and then you have to go and find another one. Sometimes I've been contacted by failed pitchers after the event to discuss getting something reduced off the ground with just the larger of the bidders, and although I've not ended up going with any of them in the end I know they do sometimes get what they need to get going that way and I'm still in touch with one of the entrepeneurs who took that route. I've had one of my cc company directors call in at my house to bring me free samples because he was on his way back from an event and passing by, I've been at a couple of dinners with another one, and all in all it's a more enjoyable way of investing than my normal 30-second round trip of button pressing and forgetting via my on-line brokers.
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Post by elljay on Feb 2, 2015 18:42:18 GMT
Good idea! Have set up a new Equities Category with a general discussion area, moved THC and EstateGuru there and set up a new board for Property Moose. Happy to add more boards if there's demand for them.
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webwiz
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Post by webwiz on Feb 2, 2015 19:14:23 GMT
These terms p2p, crowd funding, alternative investments etc seem very ill defined. I am surprised that Property moose is considered to be in a different category to the others. Is there an explanation of the different platforms anywhere?
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bigfoot12
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Post by bigfoot12 on Feb 3, 2015 8:47:07 GMT
I think that it is ill defined. The default assumption of many is that p2p is referring to lending only. I would argue that Crowd Cube and Syndicate Room are p2p in the same way that FC and TC are. Companies use a platform to issue equity direct to individuals, bypassing banks, brokers and other advisers. I think that Property Moose and House Crowd are different as they are creating and selling their own products. Anyway thanks to elljay we don't need to worry too much about the definition we can discuss these happily. |
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JamesFrance
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Post by JamesFrance on Feb 3, 2015 8:47:18 GMT
I doubt that Estateguru should be here as it is offering loans secured by property rather than equity.
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bigfoot12
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Post by bigfoot12 on Feb 3, 2015 9:12:35 GMT
Personally, though, I'd like to some discussion of private equity investments since there are some points of crossover. A few SMEs that have loans on P2P platforms have done or will do EIS/SEIS-based equity raises at some point. Some of the DD that is done for an equity raise is applicable to the loan offering, creating some two-way flow of information that can help decision making. Many a time I've thought that a loan proposition was a non-starter but an equity investment might suit. There are also an increasing number of loans appearing on EIS platforms. Did you invest in any of those with both debt and equity out there? I was considering the new airline, but it was listed on CrowdCube which I'm not registered on and something went wrong with the automatic verification and I never got any further. (I've been having a lot of problems with online identity checks in the last year.) I liked the diamond guy but I thought that the valuation was high. I considered the event building people which had a loan out there, but I got a bit busy and didn't follow it up. I'm coming across as quite fickle in this post, aren't I? I agree with you that many times I would have considered investing in a business that was going to big or a failure, but lending money even at 15% wasn't that exciting. Sorry if the names above are vague - I don't want to get banned on day one.
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Post by Goncalo | SyndicateRoom on Feb 3, 2015 9:29:18 GMT
There are a few posts on here about Property Moose, and The House Crowd have a section but these are both equity investments (largely). Would Crowdcube and Syndicate Room have a place here? In any case does anyone know of a good forum for either of those? Hi all, Some of our members dropped me a line about this forum and after reading some of the posts like the one above I definitively thought I'd join in. I'm the CEO and Co-Founder of SyndicateRoom. We are the only UK-based investor-led equity crowdfunding platform, which means our members invest under the same economic terms as experienced lead investors that are also investing their own money. Our vision is simple: 1) to give the crowd access to the top deals the professionals are investing in 2) that on a £1 per £1 invested, everybody (crowd and experienced investors) make or lose the same amount of money. Share the risk, share the reward! Sorry for the sales pitch but I just want to make sure investors that are not SyndicateRoom members understand that we are a very different platform from the remaining equity crowdfunding platforms. Here is why - www.investorschronicle.co.uk/2015/01/29/comment/chronic-investor-blog/avoiding-the-crowded-trade-GAINKEAkRvgxuCBQ3sf5WO/article.htmlLooking forward for some questions in an open and transparent forum! All the best, Goncalo SyndicateRoom - "because the crowd deserves better"
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Post by Goncalo | SyndicateRoom on Feb 3, 2015 9:37:39 GMT
No, I didn't look any further - I'd heard that seedrs was even more biased towards freebies, so didn't bother looking there, and in the space of 6 months or so I'd found enough to interest me on crowdcube. I've spent many years picking and choosing my shares, both quoted and unquoted, and I tend to do lots of research and then go in fairly big in a smaller number of largish investments - it's riskier, but I'm reasonably confident, and overall I've built up a large spread over the years. So via crowdcube I invested in just 5 different companies in the end. One of them was a small investment, one smallish, two were medium and one was large. I'm about a year and a half down the line now and none of them have gone bust yet, but it's early days! 3 are making excellent progress, 1 is making good progress and the fifth might or might not be on the brink of it. The problem I find is that the 'crowd' are attracted to shiny, sexy, internety things and things that give them free stuff. So those types of company get funded quickly, whereas good, solid businesses that do quite tedious things that make good regular money and don't give you anything free but which stand a sensible chance of making you real money down the line don't attract the magpies. That means those businesses quite often don't reach their funding target and then you have to go and find another one. Sometimes I've been contacted by failed pitchers after the event to discuss getting something reduced off the ground with just the larger of the bidders, and although I've not ended up going with any of them in the end I know they do sometimes get what they need to get going that way and I'm still in touch with one of the entrepeneurs who took that route. I've had one of my cc company directors call in at my house to bring me free samples because he was on his way back from an event and passing by, I've been at a couple of dinners with another one, and all in all it's a more enjoyable way of investing than my normal 30-second round trip of button pressing and forgetting via my on-line brokers. Great comment above: "The problem I find is that the 'crowd' are attracted to shiny, sexy, internety things and things that give them free stuff. So those types of company get funded quickly, whereas good, solid businesses that do quite tedious things that make good regular money and don't give you anything free but which stand a sensible chance of making you real money down the line don't attract the magpies." We find exactly the opposite at SyndicateRoom. If you look at the businesses we have funded so far (https://www.syndicateroom.com/about-us/success-stories.aspx), most of them are either 'deep technology', healthcare or another sector that requires strong IP protection. Most of them also have revenues already, some of them into the millions already. "That means those businesses quite often don't reach their funding target and then you have to go and find another one." We have funded c86% of the deals we've listed to date due to our highly curated approach. This reduces the frustration of spending hours doing due diligence on a deal that has no hopes of getting funded. Boring and complicated as they may be, those are the businesses that really attract angel investors. Great piece on Investors Chronicle about this here - www.investorschronicle.co.uk/2015/01/29/comment/chronic-investor-blog/avoiding-the-crowded-trade-GAINKEAkRvgxuCBQ3sf5WO/article.htmlHave a great day, Goncalo
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Post by Goncalo | SyndicateRoom on Feb 3, 2015 10:06:15 GMT
bigfoot12. We invested in the loan 1 and loan 2 of a certain start-up airline on TC (15%+ yield). However, the loans didn't require the airline to be get off the ground (no pun intended) to be repaid, just a refinancing to occur downstream at some point through another loan or equity raise. In reality while we held loan 1 to maturity, we lobbed out loan 2 for small cap gain and decided to skip loan 3 completely as it seemed to be getting riskier each time. Frankly, I have no interest in airline equity given the track record of that sector. As for the diamond guy, we're mainly watching the equity raise since it may well repay the loans. Valuations are the main problem. The SMEs on platforms like Crowdcube seem to want a large amount of money for very little equity. The implied valuations are often just silly. Crowdcube itself seems a better equity proposition than most of the companies on the platform. Balderton are one of the most savvy private equity firms on the street so the fact they invested in Crowdcube is a pretty good signal. As I said on the previous post, unless we have some sort of insight (someone I know at Balderton for example tells us this a good deal, we know the management etc), we generally avoid most of the very speculative equity offerings. For tax purposes, we do invest in some "asset rich" EIS/SEIS equity offerings. However, many of these are deliberately structured to have "bond-like" risk-return characteristics and its really about a diversified portfolio that will capture the 30-50% tax credit plus a bit more on top if we're lucky. Thank you bigfoot12, I agree that silly valuations are a problem with equity crowdfunding. That is why all the valuations on SyndicateRoom are set by the negotiation between the company and the lead investors, who have to put at least 25% of the funding round of their own capital. So basically the crowd gets the same price per share and same class of shares that the experienced investors are investing their own money at. If you analyse our deals and their valuations, you will notice a very notable difference in valuations to the 'typical' company crowdfunding. That's the benefit of an investor-led model like ours - designed for investors! Have a great day, Goncalo
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bigfoot12
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Post by bigfoot12 on Feb 3, 2015 10:08:03 GMT
bigfoot12. We invested in the loan 1 and loan 2 of a certain start-up airline on TC (15%+ yield). However, the loans didn't require the airline to be get off the ground (no pun intended) to be repaid, just a refinancing to occur downstream at some point through another loan or equity raise. In reality while we held loan 1 to maturity, we lobbed out loan 2 for small cap gain and decided to skip loan 3 completely as it seemed to be getting riskier each time. Frankly, I have no interest in airline equity given the track record of that sector. As for the diamond guy, we're mainly watching the equity raise since it may well repay the loans. Valuations are the main problem. The SMEs on platforms like Crowdcube seem to want a large amount of money for very little equity. The implied valuations are often just silly. Crowdcube itself seems a better equity proposition than most of the companies on the platform. Balderton are one of the most savvy private equity firms on the street so the fact they invested in Crowdcube is a pretty good signal. As I said on the previous post, unless we have some sort of insight (someone I know at Balderton for example tells us this a good deal, we know the management etc), we generally avoid most of the very speculative equity offerings. For tax purposes, we do invest in some "asset rich" EIS/SEIS equity offerings. However, many of these are deliberately structured to have "bond-like" risk-return characteristics and its really about a diversified portfolio that will capture the 30-50% tax credit plus a bit more on top if we're lucky. I was in airline loan 2 as well, tempted by the rate and the cashback. I have since sold out for all square after the selling fee. No regrets at having missed my chance to invest in the equity at a discount. I had a look at some asset rich EIS schemes and the fees are so large on some of them that I felt ill. I decided to invest in a few small companies two years ago. I think SEIS are generally overvalued because the tax break is just too tempting. I'm starting to learn a few lessons, but it will be another few years before my education is up to the average. I'm still working out how risky these investments are (relative to each other - obviously very in absolute terms). Some have lower expected returns because they are supposed to be less risky, but I'm not sure. Tax is very favourable compared to p2p lending.
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ramblin rose
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Post by ramblin rose on Feb 3, 2015 10:43:01 GMT
Sounds interesting Goncalo | SyndicateRoom; should I find myself wanting to do any more angel investing in the future I'll certainly give you more consideration this time round  Currently very happy with my cc investments though - in most cases the valuations were improved considerably between first offer and final level that proved successful on the ones I chose to run with. I'll report back on how things go with them if it turns out people are actually interested. If nothing else, this discussion has prompted me to email a couple of the entrepeneurs that I haven't heard from in a few months to see how things are going with my businesses, so thank you bigfoot12 |
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shimself
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Post by shimself on Feb 3, 2015 15:09:14 GMT
Good idea! Have set up a new Equities Category with a general discussion area, moved THC and EstateGuru there and set up a new board for Property Moose. Happy to add more boards if there's demand for them. I think there's a world of difference between Syndicateroom / seedrs / crowdcube on the one hand and THC on the other The former are definitely high risk high potential gain operations, mainly into startup businesses. You could lose everything, you could multiply your investment 10fold. THC have 80 people each putting £1k into a buy to let property. OK it's structured as a single company and investors receive a share, but it's hard to imagine a complete loss, it feels to me much more like a loan with an expectation of a 10%+ return. ie I think it's pedantic and unhelpful to put THC in this category. (Propertymoose - pass, it's a sort of fund isn't it?)
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Currently very happy with my cc investments though - in most cases the valuations were improved considerably between first offer and final level that proved successful on the ones I chose to run with. I'll report back on how things go with them if it turns out people are actually interested. If nothing else, this discussion has prompted me to email a couple of the entrepeneurs that I haven't heard from in a few months to see how things are going with my businesses, so thank you 