About Us

6 things you should know about our Crowdfunding campaign

Published on: 20th May 2016

There are many different types of crowdfunding, and here we break down the essential information you might want to know regarding the basics. Continue reading to find out more.

1. There are many different types of Crowdfunding.

At its heart crowdfunding is about raising money from a wide range of ordinary people who believe in a business’ idea and its potential to grow.

You can crowdfund for charity, offer a product in return for investment (like Kickstarter does), contribute to a small loan for a business (P2P lending) or offer shares in your business in return for investment. This last type is called equity crowdfunding and that’s the type of crowdfunding we’re going to be launching.

We’re looking to raise money from a wide range of people and in return give them a stake of the company. The more you invest, the more you own.

2. Crowdfunding is massive these days

$34bn was raised globally through crowdfunding in 2015, and $2.5bn of this was for equity investments.* Crowdfunding for business became big after the credit crunch and economic downturn as small, innovative businesses found it hard to get loans from banks in the traditional way. Crowdfunding is no longer a resort though – many businesses want to use it because it’s a way to tap into the enthusiasm and expertise of small investors around the world and build interest in the brand.

We chose crowdfunding because we wanted to build a passionate group of ambassadors for UnderTheDoormat – people who see what we are doing and really believe we can go places, just like we do.

3. Early investors who pay tax in the UK are eligible for tax relief

UnderTheDoormat has been officially declared an innovative business. The UK gives tax relief to early investors because it wants to encourage businesses like ours to grow.
Early investors (in the first £82,500 raised) who pay tax in the UK will be eligible for tax relief through the
Seed Investment Enterprise Scheme

, which will give you 50% tax relief on your investment. We’re definitely not financial advisers so we can’t say whether this is right for you or not, but we think it’s relevant.

4. We’re revenue generating already

Many businesses who are crowdfunding are ‘pre-revenue’ and they crowdfund to help get the business up and running. We decided to get the business up and running first and – now we’ve got the foundations in place – we want to use crowdfunding to support our expansion.

In 2015 (our first full year) we had booking values of over £100,000 and this year we’re on track for over £400,000. You can see our growth in the graph below.

5. Crowdfunding is designed for non-specialists as well as the pros…

People often ask if crowdfunding is too serious and intense for them. “Do I need a stock broker?” “Is there a minimum amount?” “Won’t it be a real hassle for me to do?” (The answer to all of these questions is no.)

Crowdfunding is designed to open up investment in companies to ordinary people. A recent study by Nesta and the University of Cambridge found that 62% of investors in companies described themselves as having no previous investment experience.**

6. …and you can invest as much or as little as you want

One of the beauties of crowdfunding is that you can invest as much or as little as you’d like. A huge number of people support new businesses with small investments and they really do add up.

The average investment in a crowdfunding campaign is £2,500* – £3,000** but this includes large investments from professional investors. Much of the money raised from crowdfunding is from small donations from people who want to support a business and own a little bit of their success.

We’re still working out the fine details, but we expect an individual share in UnderTheDoormat will be around £25 in this round of investment, so it’s easy to own a bit of our company for a pretty small amount.

So, those are our 6 ‘must-knows’ about our crowdfunding campaign. Did we miss anything you wanted us to cover? Let us know!
And don’t forget you can pledge your interest in investing here.