It is tempting to see it as a mere footnote to a successful and oversubscribed City cash call.
But SyndicateRoom’s participation in 3i Infrastructure’s £385million share placing was interesting and ground-breaking for the world of crowdfunding.
The cash raised via the devotees of the platform, who are more used to bankrolling start-ups than an established listed company, was never going to make or break the transaction.
However, it provided proof of concept; it revealed SyndicateRoom’s platform was equipped, ready and able to participate in a big equity funding round by a main market listed entity.
Remember, users had already been privy to a stock placing carried out by Scancell, the AIM-listed pioneer in immuno-oncology.
And there’s a unique selling point of SyndicateRoom – it’s not just about raising seed capital.
In the 3i deal the company acted as what’s known as an intermediary. This simply meant it provided a gateway for ordinary investors to a City fund-raising only normally open to the big funds.
Crucially, these private investors were allowed to participate on the same terms as the institutions and uber-rich family offices.
The next major deal? Well, that could be the part-privatisation of Lloyds Banking Group, which occurs later this year once the tricky issue of Brexit is out of the way and the markets have settled down.
The line from SyndicateRoom is it is ‘well positioned’ to participate in the offering of shares by the government-run UKFI and it does have a Lloyds page on its site.
Tom Hinton, the company’s head of capital markets, is in no doubt as to the importance of the 3i Infrastructure placing and open offer.
‘It raises the profile of the public markets capability of the site,” he told Proactive Investors.
“People understand they will get access to these types of opportunity through the SyndicateRoom platform.
‘We are bringing City fundraisers to the crowd. This proves SyndicateRoom is now fully set up to execute public market trades and we are well positioned to offer our members publicly-traded shares including the Lloyds placing.’
The firm’s traditional crowdfunding platform is doing well with SyndicateRoom having helped raised £55million for an army of small and growing businesses that are the lifeblood of the economy.
Its approach is subtly different from the traditional model, which is company-focused.
It is one that provides protection for the ‘crowd’ of small investors that get behind fledgling enterprises.
And it also appears to have a positive impact on failure rates.
Practically, it is focused on putting the investor first (rather than the firm), which means any fundraising on the site is ‘cornerstoned’ by an experienced, professional backer of growth companies.
This person carries out the leg-work research on the business, negotiates the price of the shares and, crucially, buys in on the same terms as the rank and file investor.
‘So, instead of having the crowd investing in all the deals the professionals don’t want to invest in, we allow the crowd to invest in the deals the professionals are interested in,’ explained Goncalo de Vasconcelos in a recent interview.
Referring to the competition, he says: ‘It is really easy to find companies looking for money. It is much harder finding good companies.’
The minimum investment is £1,000, a sum that makes people think before they make the leap, says the SyndicateRoom boss.
The majority use the tax-efficient enterprise investment scheme, which means they have to sit on the stock for at least three years before selling.
Last month SyndicateRoom raised £3.1million via its own platform, backed by healthcare entrepreneur Jonathan Milner.
CEO de Vasconcelos called it the ‘strongest vote of confidence’ in the platform.
Read more here.