The Exchanges

Q And with the rise of crowdfunding in recent years, many, many argue that the crowd are competing finance model to the traditional VC model. Do you agree, or do you think that actually it's fundamentally different?

A Uh, I don't think it's fundamentally different, um, but you should view it more as plugging a gap. You know, a lot of people talk about the equity gap, uh, and some people tell you it's anywhere from half a million up to about two or three million. Um, what we're seeing is that VCs aren't coming in, um, into a round until it reaches a certain size, and that size is getting larger and larger. Um, so, so what A VC would have done a few years ago, five or 10 even, you know, playing in a two million round. Now they won't touch anything below, say, five million. So really crowdfunding kind of fills that void that's been vacated by these VCs.

AI assessment note: “I don't think it's fundamentally different, um, but you should view it more as plugging a gap.”

Q And with the rise of crowdfunding in recent years, many, many argue that the crowd are competing finance model to the traditional VC model. Do you agree, or do you think that actually it's fundamentally different?

A Uh, I don't think it's fundamentally different, um, but you should view it more as plugging a gap. You know, a lot of people talk about the equity gap, uh, and some people tell you it's anywhere from half a million up to about two or three million. Um, what we're seeing is that VCs aren't coming in, um, into a round until it reaches a certain size, and that size is getting larger and larger. Um, so, so what A VC would have done a few years ago, five or 10 even, you know, playing in a two million round. Now they won't touch anything below, say, five million. So really crowdfunding kind of fills that void that's been vacated by these VCs.

AI assessment note: “I don't think it's fundamentally different, um, but you should view it more as plugging a gap.”

Q And you, you mentioned earlier that, that at the end of the day, crowdfunding is still a relatively risky asset. Is that what you'd say the biggest problem facing crowdfunding is today?

A I personally feel that the biggest problem facing crowdfunding is awareness. Um, and it's awareness of, of the industry and the fact that people can invest in these young companies, but it's also awareness of that risk. So the more people that you reach, you have to be sure that they understand what they're getting into. Um, and, and that's kind of a challenge. You know, it's quite easy to To look at something and want to invest. Um, it's another thing to fully understand everything about that investment. And, you know, I hate to cite that Nestor report again, but they recommend that Angel should really look at something for about 20 hours before investing. Um, and you, you need to convey that message to everybody. You know, really do your due diligence.

AI assessment note: “I personally feel that the biggest problem facing crowdfunding is awareness.”

Q Now, first, I'm really curious about how you got into the technology industry and then moved into the early concepts at the time of equity crowdfunding. Could you tell us a little about that?

A Yeah, well, it's kind of a funny story. I, um, I grew up in the States, but my dad's British, so I was always a football fan growing up, and when I finished my undergraduate degree, um, I decided to move to the UK and try playing, uh, professional football, so moved over. I was playing kind of in the Scottish second and third division, um, doing all right, but, but realizing that I wasn't going to make it to the top, and you have to understand when you're, when you're with these Kind of lower league clubs. You're not making a lot of money. So I had this part-time job, um, being a project manager for the company called the train line, the train line.com. Absolutely. Yeah. And, uh, when I got, when I decided to retire at the ripe old age of 25, I, I got offered kind of a promotion at the train line to, to look at their, um, product development. And in product development, I was responsible for kind of It teams and marketing and, and really focusing on their mobile application development. So through kind of pure luck and just hard work, I, I moved from having studied economics to being a quasi professional footballer into it and software development. Uh, at that point in time, I, I, you know, I was doing these apps and I kind of realized that I was making a lot of money for, for a Why don't I try and do this for myself? But, uh, not having experience in other parts of business, I…

AI assessment note: “I moved from having studied economics to being a quasi professional footballer into it”

Q And do you, do you employ any marketing tactics to really get the equilibrium of investors to companies?

A Um, Well, you could call everything marketing, right? A newsletter is, is marketing. Um, we, we aim to put out press releases about the companies that are raising finance, but we're very focused on, on the company more than ourselves. So, and we're also focused on kind of the industry that that company is in. Um, because we know that like the types of companies that we get tend to be quite mature. Um, a lot of them are, are IP heavy. And we know that there's a select audience that are going to understand that type of investment. Um, so we go after journals that might be in the field that the company is operating or other papers that are in that field. Um, we haven't really done a massive, uh, more general blitz of marketing. It's, uh, it's very targeted.

AI assessment note: “we go after journals that might be in the field that the company is operating”

Q Does Syndicate Room have the potential to connect lead investors from previous rounds to future investors looking for that anchor angel? Do you think?

A We've, we've done it before. Um, it's not the business that we're in, but It's actually working with all of the angel networks who tend to be the lead investors and knowing what it is that they're interested in and what they tend to invest in. If we get something that really stands out and doesn't have a lead investor, then we're happy to send it on to one of the, one of the lead groups, whether it be an angel network or a fund. We can't make any promises though that that fund will then say, yeah, we want to invest, but We're here to help the ecosystem as a whole, so it's not like we're going to turn everyone away and just say, go help yourself.

AI assessment note: “We've, we've done it before. Um, it's not the business that we're in”

Q And you, you mentioned earlier that, that at the end of the day, crowdfunding is still a relatively risky asset. Is that what you'd say the biggest problem facing crowdfunding is today?

A I personally feel that the biggest problem facing crowdfunding is awareness. Um, and it's awareness of, of the industry and the fact that people can invest in these young companies, but it's also awareness of that risk. So the more people that you reach, you have to be sure that they understand what they're getting into. Um, and, and that's kind of a challenge. You know, it's quite easy to To look at something and want to invest. Um, it's another thing to fully understand everything about that investment. And, you know, I hate to cite that Nestor report again, but they recommend that Angel should really look at something for about 20 hours before investing. Um, and you, you need to convey that message to everybody. You know, really do your due diligence.

AI assessment note: “I personally feel that the biggest problem facing crowdfunding is awareness.”

Q And do you, do you employ any marketing tactics to really get the equilibrium of investors to companies?

A Um, Well, you could call everything marketing, right? A newsletter is, is marketing. Um, we, we aim to put out press releases about the companies that are raising finance, but we're very focused on, on the company more than ourselves. So, and we're also focused on kind of the industry that that company is in. Um, because we know that like the types of companies that we get tend to be quite mature. Um, a lot of them are, are IP heavy. And we know that there's a select audience that are going to understand that type of investment. Um, so we go after journals that might be in the field that the company is operating or other papers that are in that field. Um, we haven't really done a massive, uh, more general blitz of marketing. It's, uh, it's very targeted.

AI assessment note: “we aim to put out press releases about the companies that are raising finance”

Q Of the applications to, um, be on your platform, how many do you accept in percentage wise, would you say?

A I'm going to get the numbers wrong. Apologies, I should know. But if you look at it this way, um, most of the companies that are out there come to us and they don't have a lead investor yet. So by rule, they're ruled out. Um, then we start to get into the fact of, okay, now these companies are looking for, um, a couple of million. Do we think we can raise that? Yes or no. So there, there's this tick box. And I would say, You know, maybe one in one in 50 would be a best guess. We're able to actually list on the platform, if not more. But that's just because people have an awareness of, oh, it's, it's equity crowdfunding, so we'll just send them our pitch deck, and hopefully they'll want to work with us, not taking into account all of the other things that, that we tell them, like, look, you have to have lead investors, you have to offer preemption, drag along, tag along, right? All of your, our investors have to invest on the same terms. There are a lot of things that people don't read that is readily available on the website, and we have to just rule them out because of that.

AI assessment note: “maybe one in one in 50 would be a best guess”

Q Does Syndicate Room have the potential to connect lead investors from previous rounds to future investors looking for that anchor angel? Do you think?

A We've, we've done it before. Um, it's not the business that we're in, but It's actually working with all of the angel networks who tend to be the lead investors and knowing what it is that they're interested in and what they tend to invest in. If we get something that really stands out and doesn't have a lead investor, then we're happy to send it on to one of the, one of the lead groups, whether it be an angel network or a fund. We can't make any promises though that that fund will then say, yeah, we want to invest, but We're here to help the ecosystem as a whole, so it's not like we're going to turn everyone away and just say, go help yourself.

AI assessment note: “We've, we've done it before. Um, it's not the business that we're in”

Q Of the applications to, um, be on your platform, how many do you accept in percentage wise, would you say?

A I'm going to get the numbers wrong. Apologies, I should know. But if you look at it this way, um, most of the companies that are out there come to us and they don't have a lead investor yet. So by rule, they're ruled out. Um, then we start to get into the fact of, okay, now these companies are looking for, um, a couple of million. Do we think we can raise that? Yes or no. So there, there's this tick box. And I would say, You know, maybe one in one in 50 would be a best guess. We're able to actually list on the platform, if not more. But that's just because people have an awareness of, oh, it's, it's equity crowdfunding, so we'll just send them our pitch deck, and hopefully they'll want to work with us, not taking into account all of the other things that, that we tell them, like, look, you have to have lead investors, you have to offer preemption, drag along, tag along, right? All of your, our investors have to invest on the same terms. There are a lot of things that people don't read that is readily available on the website, and we have to just rule them out because of that.

AI assessment note: “maybe one in one in 50 would be a best guess.”

Q And what is the hardest obstacle that you've faced in building Syndicate Room to the amazing platform it is now, and how did you overcome it?

A Wow. Uh, that one, that one's a tricky question, I guess. Um, Yeah. It's for any entrepreneur. It's, it's that first kind of six to 12 months where things are moving slowly. Sure. Everyone's got this vision of we're going to be amazing. And the second we get it out there, there's going to be a million people on our website and everyone's going to be investing. But given that our industry is so young and us within the industry are, are even younger, um, you know, it's, it's been, I don't want to say it's slow growth, because we have grown quickly, but the, the expectations and these visions that you get in your head of, yeah, and next year I'm going to be on Forbes, on the cover of Forbes as a thought leader, so that you kind of have to bring that all into perspective and be realistic about it, and, and I will say that we've done a lot, and we've, we've knocked all of our KPIs out of the park, we keep readjusting things, so we're growing, and we're on a tremendous back, but You know, we're ambitious, so it's always like, well, we should be, we should be the biggest by now, and it's like, well, we've only been around live for 18 months, so, so is that really a fair expectation to have?

AI assessment note: “that first kind of six to 12 months where things are moving slowly”

Q And what is the hardest obstacle that you've faced in building Syndicate Room to the amazing platform it is now, and how did you overcome it?

A Wow. Uh, that one, that one's a tricky question, I guess. Um, Yeah. It's for any entrepreneur. It's, it's that first kind of six to 12 months where things are moving slowly. Sure. Everyone's got this vision of we're going to be amazing. And the second we get it out there, there's going to be a million people on our website and everyone's going to be investing. But given that our industry is so young and us within the industry are, are even younger, um, you know, it's, it's been, I don't want to say it's slow growth, because we have grown quickly, but the, the expectations and these visions that you get in your head of, yeah, and next year I'm going to be on Forbes, on the cover of Forbes as a thought leader, so that you kind of have to bring that all into perspective and be realistic about it, and, and I will say that we've done a lot, and we've, we've knocked all of our KPIs out of the park, we keep readjusting things, so we're growing, and we're on a tremendous back, but You know, we're ambitious, so it's always like, well, we should be, we should be the biggest by now, and it's like, well, we've only been around live for 18 months, so, so is that really a fair expectation to have?

AI assessment note: “bring that all into perspective and be realistic about it”