Hi Luke, thank you so much for taking part, please tell us about the man behind Crowdcube.
I’m co-founder and Chief Marketing Officer (CMO) of Crowdcube, which I launched together with Darren Westlake in February 2011. My background is in marketing and public relations, and I’ve worked with blue-chip brands and start-ups, as well as run my own marketing consultancy.
You have not only created a platform that startups benefit from, but it has launched many from the ground up. What is the story behind Crowdcube?
We’d witnessed entrepreneurs with great ideas struggling to raise finance from traditional sources, which spurred us on to look for an alternative approach. Rewards-based crowdfunding was gaining in popularity, and we thought the model could be adapted to equity investment – making it more accessible, affordable and rewarding for both investors and entrepreneurs.
Crowdcube is open to everyone, but can anyone take on the role of being an investor?
Yes, as long as they fully understand the risks, and are over 18 years of age. Crowdcube’s aim is to democratise investment – you don’t have to be wealthy to back a business you believe in, you can ‘dip your toe’ in by investing as little as £10.
Do you remember your initial reaction when you realised; yes, this concept is working?
When investment started flowing through the platform, and we could see people really were backing businesses 24 hours a day, seven days a week, we knew the online model was working. We had our proof of concept, businesses were hitting their targets and funding, and we had our first £1 million raise very early on. Our reaction was “wow” – it felt incredible. There was a real sense of achievement and satisfaction in knowing we were helping businesses to fulfil their potential by raising growth capital; all the sacrifice and effort needed to get to that point had been worth it. There really is no better feeling.
Are there any plans in the future to introduce other types of investments?
Not at present – we’re 100 percent focused on being the UK’s number one equity crowdfunding platform, and developing and growing what we currently offer businesses and investors.
Most entrepreneurs starting out have a lot of challenges ahead of them, especially funding. What would you say to those who are now ready to approach investors?
Get prepared! Make sure you have data that demonstrates momentum – whether that’s member sign-ups, sales or revenue – and which proves there’s a market for your product or service. You also need to have a strong narrative behind your pitch. What is your success to date? How will you spend the money you raise? Securing lead investment will help, if you can do that – it will validate your business plan and give others the confidence to invest.
How do you relax when you’re not running Crowdcube?
I’m a keen triathlete, so running, cycling and swimming! I also completed a Half Ironman last year.
What would be your biggest marketing tip to get out there as a startup?
Track and measure what you do, to tie your marketing spend directly back to effectiveness and the impact it’s having on the business. This is a lot easier with digital marketing than print or PR for example. You need to find out what really works, and continually optimise resource and money in the right areas. Don’t be afraid to test and try things early on – you can do this on a relatively low budget, and it will make sure you learn quickly what’s most effective for you.
How do you think startups can set themselves apart amid all their competitors
A proposition which is based on creating real value that customers want. If you’re solving a problem that needs to be solved, and doing it better than anyone else, you’re differentiating yourself. Keep the message clear and simple – making the proposition over complicated or too sophisticated will be counterproductive.
How important do you think branding is for small businesses?
It does provide a point of differentiation, but it’s easy to ‘over egg’ branding in the early days. Brand is something which evolves over time, and requires investment, so don’t get too hung up on having everything in place at the start. You need a meaningful, appropriate name and corporate identity which reflect the ethos of the founder, and design that looks professional. Everything else, like key messages for example, can be quite fluid; the full brand identity will develop naturally as you grow.
If you could have anyone record the voice message on your mobile, who would it be and why?
Stephen Fry, because he’s a national treasure and will undoubtedly put a smile on every caller's face.
What plans do you have for Crowdcube over the coming 12 months?
We’ll continue to grow our share in the equity investment space, attract larger and more established later-stage businesses to the platform, increase the size of the funding rounds and accelerate investor returns. We also aim to improve the flow of information ‘the crowd’ receives on how their investments are performing.