When you invest in startups via SyndicateRoom you do so knowing that each opportunity is led by an experienced business angel or early-stage investors. It is only after they have conducted their own due diligence, negotiated the valuation at which to invest, and invested their own money that these opportunities are presented to our members who invest at the same economic terms as the lead investor.
You can take our word for it, or you can read a report produced by NESTA, which calculated the average annual internal rate of return for business angels between the years 2000–08 was 22% – more than double the average stock market return during the same period.
Risk Warning: Investing in startups and early-stage businesses involves risks, including illiquidity, lack of dividends, loss of investment and dilution, and it should be done only as part of a diversified portfolio. SyndicateRoom is targeted exclusively at sophisticated investors who understand these risks and make their own investment decisions. Please click here to read the full risk warning.
Quality from experienced investors
We’ve helped more than 100 companies reach their targets.
of those are
Funded on SyndicateRoom
SyndicateRoom is proud to have helped UK businesses secure more than £70 million in funding since launching in September 2013. These include Axol Bioscience, which uses Nobel Prize-winning technology to develop human cells for scientific research, rendering animal testing obsolete; Beulah, the womenswear brand (and anti-human trafficking charity) with a long list of celebrity patrons, including the Duchess of Cambridge; Salty, the first ever equity crowdfunded Hollywood film; and many more.
In December 2016 Oval Medical Technologies became the inaugural member of SyndicateRoom's Exit Club after being acquired by SMC Ltd. for an undisclosed amount. This news came just two years after Oval's SyndicateRoom raise, which was held in August 2014 and led by Jonathan Milner, Phil O’Donovan and Michael Day – all well-known private investors in the life sciences.
Click here to find out more about the startups that have raised money on SyndicateRoom.
Your benefits as a SyndicateRoom investor
Invest at the valuation set by the lead investor – Would you rather invest at the valuation the entrepreneur says the business is worth, or the value that an experienced investor determines? We thought so.
Invest in UK businesses at the same economic terms as the professionals – Why should some investors get A shares and others B when all are taking the same level of risk? At SyndicateRoom all investors receive the same economic terms whether they are investing £1,000 or £100,000.
Tax relief – The large majority of our investment opportunities are Enterprise Investment Scheme (EIS) or Seed Enterprise Investment Scheme (SEIS) eligible. Qualifying investors receive tax relief on their initial investment and additional relief in the event that the company they’ve invested in fails.
No fees for our investors - We do not charge our investors a single fee; there is no membership fee nor do we charge a transaction fee so when members invest £5,000 they receive £5,000 worth of shares. If those £5,000 become £50,000, you take all the upside - we don’t charge a carry on your profits.
Ease of creating a portfolio – It’s easy to create a diversified portfolio using SyndicateRoom’s platform, so whether you are looking to add an alternative to your stocks and shares or build out a full portfolio of early-stage investments, you can do so here.
As of September 2016, the sector distribution of companies funded through SyndicateRoom has been as follows, with life sciences leading the pack. According to the report Analysis of Crowd-based Financing in European Life Sciences, SyndicateRoom leads the way when it comes to life sciences fundraising in Europe.
Who uses SyndicateRoom?
Sophisticated investors: A type of investor who is deemed to have sufficient investing experience and knowledge to weigh the risks and merits of an investment opportunity. They generally have either worked in finance or have made at least two investments in unlisted companies in the past.
High-net-worth individuals: In the UK a high-net-worth individual is an individual who earns £100,000 or more per year or has net investable assets of over £250,000.
Business angels: A business angel, sometimes referred to as angel investor, is an individual who provides capital for early stage companies, usually in exchange for shares. They can come in all shapes and forms but are usually very experienced business people who may be interested in angel investing for reasons that go beyond pure monetary return. In addition to funds, angel investors can often provide valuable management advice and important contacts.
How it works for investors
1) Lead investor agrees terms with entrepreneurs and invests
Experienced Angel investors negotiate the terms of investment with the entrepreneurs and decide how much capital they will invest. The business valuation is negotiated by the lead investors to a point they are happy to invest their own capital. As a result SR members will invest in deals with a realistic valuation rather than unrealistic valuations set by entrepreneurs alone.
2) SyndicateRoom members invest
SR members can see all information regarding an investment deal and the respective terms of the investment such as valuation offered to SR members. Members can ask questions to the entrepreneurs and can read all questions asked by other members and the respective responses. Each SR member makes his or her own individual decision to invest and can invest at a click of a button.
3) SyndicateRoom takes care of all the legal hassle for its members
As an SyndicateRoom member and investor, you do not have to worry about any legal paperwork regarding the investment. You won't depend on us if you want to sell your shares.
4) SyndicateRoom transfers the funds to the company
Only when all legal documentation is finalised we will transfer the funds to the company. If for any reason the funding round does not complete, funds are returned to investors without any charge.
5) Company growth
Once the company receives the investment, the exciting journey begins. Log into SyndicateRoom to check how the company is doing based on its latest tweets. At this stage some companies will fail, some others will succeed. You are a Business Angel investor therefore expect some losses in some investments and if you are good at picking deals, great returns on others.
Most angel investors look at a three to five years' return from their startup investments. Sometimes it can take much longer and losses will occur earlier than the big gains. For those companies that succeed, the exit is usually a trade sale (selling of the whole business to another company) or an IPO (Initial Public Offering – listing on the stock exchange). This is the stage where great returns can be achieved for astute investors.