Case study of Crowdestate p2p lending platform and Click & Grow. As technology advances, it creates many possibilities for us – including p2p lending as an alternative to traditional bank financing. This enables p2p lending investors that have funds invest into companies that need additional finances to grow. By choosing the right crowdfunding platform, getting a business loan for your company has never been easier. And investors have the chance to partake in the success of companies without needing large amounts to invest. One thing to consider though, while crowdfunding does have some advantages over traditional bank financing it is not meant to totally replace banks – they both have a similar overall goal.
Three important tips from Crowdestate’s partner Imre Noorkikas
To ensure that a project will get funded on a crowdfunding platform, it’s not just a matter of putting it up and waiting. The success of a campaign is determined by a few key elements:
- The story – if a company has successfully created a brand image, corporate image or product and knows how to convey their story passionately, investors will also respond passionately. Of course beautiful visuals help a lot, and why not even use a video to address investors directly.
- Simplicity and transparency – A crowdfunding investor is usually very selective about the types of projects they invest in, and with a reason – they want to see profit! If at any time the investor feels doubt about the quality or transparency of the materials presented, he will pass on investing.
- Be realistic – Never forget that for a company, receiving funding is an obligation, a loan. So, the project and its action plan must be realistic and thoroughly thought through. The investor will surely assess the company, its management and owners and their ability to follow through on the business plan. It is also worth to note that a competent team and a realistic plan is more important than the company being profitable at the time of the funding campaign.
The partnership of Click&Grow and Crowdestate
One of the really great examples of crowdfunding a business loan while including all of the above mentioned success factors, is the cooperation of Crowdestate and Estonian company Click & Grow. Click & Grow has been operating for 8 years and they have developed novel technologies to help grow plants in an urban environment.
Payment terms from suppliers, the rapid growth of the company and the increasing demand for their products brought Click & Grow to Crowdestate. The 0.5 million euro business loan was issued by four hundred crowdfunding investors with a remarkable speed.
The investment enabled the company to fund the production and purchase of additional stock – which has supported the company’s growth. They have been able to start cooperating with many new customers in Western Europe and have increased their sales revenue twofold compared to a similar period of last year.
Click&Grow founder Mattias Lepp says:
Click & Grow is in a state of rapid growth, which made it necessary for us to find additional working capital to be able to meet the increased seasonal demand. Crowdfunding is an excellent way to find funding fast and effectively. During our early years we were very successful on Kickstarter – with the aid of backers we were able to launch our most successful products. So, we have really seen how effective crowdfunding is as a tool. And it is a way to market your products by introducing it to thousands of people. Our experience with crowdfunding has been great, which is why we turned to Crowdestate when we needed additional working capital.
The process was fast and convenient. Crowdestate crowdfunding platform was very professional – all of our questions were answered thoroughly. And their attention to detail and thorough checks of the documents made them seem very trustworthy. Both of the investment opportunities were fully funded in just a matter of hours, which gave us a lot of motivation showing that investors believe in us and our progress hasn’t gone unnoticed.
Writteb by karin telling from Crowdestate