Eureeca: The Innovation Enablers and Investment Nurturers
Launched out of an expressed need, Eureeca is the first global equity crowdfunding platform. It enables members of its investor network, who range from casual and angel investors to institutional firms, to buy shares in growth-oriented businesses, while providing operational businesses with crucial access to capital. From its offices in Dubai, London, and Kuala Lumpur, Eureeca offers high-yield potential investment opportunities from the Middle East, Europe, and Southeast Asia to its 10,000-strong investor network. The Berries interviewed Sam Quawasmi, Co-CEO and Co-founder of Eureeca to tell the brand narrative.
BB: Can you talk a little about the Eureeca brand?
SQ: As former investment bankers and entrepreneurs we were keenly aware of the challenges that businesses face in seeking funding.The writing on the wall was clear – 50% of the jobs are created by SMEs but one of the main reasons an SME fails in the first 5 years is lack of access to capital. Coupled with the changing dynamic in the global economy (debt crisis 2008) it was evident how difficult it was for any business, let alone an SME, to get funding.There is a clear “no-man’s land” gap between venture capitalists that are looking to make large investments to generate big returns fast, and risk-averse banks that offer limited loans to SMEs.The idea behind Eureeca was to offer a transparent, cooperative and cost effective way for growth-oriented businesses to get access to much needed expansion capital through a robust digital infrastructure. Equity Crowdfunding has the potential to foster greater financial inclusion and to facilitate lending in support for SMEs and growth oriented businesses. The impact – especially for emerging markets like MENA that rely on job creation to nurture the upcoming workforce – is more jobs, given that 90% of hires are made after a company receives financing.
BB:How can Eureeca revolutionize the matchmaking process between investors and entrepreneurs?
SQ: As the first multi-regulated equity crowdfunding platform, Eureeca has fundamentally changed the matchmaking process between growth oriented businesses and investors by creating an opportunity for cross-border investment previously unseen in the market. Having received licensing from the UK Financial Conduct Authority and the Securities Commission Malaysia in 2015, and recently the Netherlands Authority for the Financial Markets and Dubai Financial Services Authority, Eureeca offers high-yield potential investment opportunities from the Middle East, Europe, and Southeast Asia to its 12,000-strong investor network. Businesses raising funds can leverage this network for capital, strategic connections, and expansion into new markets.
BB: How does Eureeca as a brand evolve to cope with the latest Fintech industry trends such as mobile money?
SQ: The mobile money sector can be found in emerging markets the world over. And while the mobile money story is still unfolding, it is already an excellent example of innovative technology being used by a market to greatly accelerate development.
Why wait for an inclusive banking industry, with more brick-and-mortar locations, to emerge when technology can be used to provide huge numbers of people with quick access to financial services using largely pre-existing infrastructure?
Innovative uses of technology are the way forward for all of us. This is particularly true for emerging markets, which can leverage technology to bypass much of the lengthy evolutionary process undertaken by developed markets to build similar, perhaps less efficient systems.
Eureeca is utilizing the latest digital technology to offer an equity crowdfunding platform that connects entrepreneurs and investors in a cutting-edge and innovative manner – where investors can invest using their smart phones and credit cards in an easy efficient process. These digital and innovative methods do not exist in the current capital markets where we are today. And Eureeca is here to change that.
BB: How does Eureeca help startup brand builders craft their narratives and brand stories?
SQ: For a startup to create value, it’s not enough to see a gap in the market and steamroll into developing a solution. You need to understand whether that gap is sufficient enough not to be able to be filled by existing solutions. And not only does your proposition need longevity (a fad is not sustainable as a value proposition), but you need to see your product through your customer’s eyes. Don’t make too many assumptions on what they want.
At Eureeca, our role is to guide the entrepreneur in narrating their investment case and to assist them with ensuring that they communicate the appropriate message to each stakeholder. Prospective investors each have different needs and will be searching for a key message that resonates directly with them and piques their interested in a particular business.
BB: How can crowdfunding help established brands strengthen ties with their consumers and help drive innovation?
SQ: Crowdinvesting harnesses the power of social media where the crowd can conduct due diligence, research and filter viable businesses for investment, essentially democratizing equity crowdfunding.
The crowds are now financial contributors to an early-stage business or SME and, given their vested interest, they will become ambassadors for the brand – marketing, sharing and virally promoting the business – spreading the word about the business, help them make strategic connections, and perhaps provide them with follow-on funding later on down the road.
BB: Can you mention some of Eureeca’s successful crowdfunding campaigns?
SQ: Since it’s launch in 2013, Eureeca has grown to an active investor base of 12,000 from 42 countries with an average investment size of $5,900. 18 businesses have been funded and US$3.7 million has been successfully been raised and released to businesses.
UK-based Homes or Houses set a platform record having raised $610,000 on Eureeca in under 30 days. The Homes or Houses campaign really embodied the true potential of equity crowdfunding having received 47 different investments, with both retail and institutional participation from across borders.
BB: Can you provide advisory tips for wanna-be entrepreneurs to raise investment through crowdfunding?
SQ: For any growth-oriented businesses looking to raise funds through equity crowdfunding platforms such as ours, here are some of our key takeaways:
1.Know When The Time Is Right
It’s not easy to think about raising money for your business. It’s daunting. You are putting everything out there, laying your business model bare for everyone to see. And you are asking them to take a leap of faith and to invest their cash into your dreams. But if you want to take your business to the next level, eventually everyone is going to need an external injection of cash.
Before launching your first self-funding round, you need to get validation from your network of supporters. You can start by building out your existing channels such as your contact base and social network. The expression of interest to invest in your company will give you the final push and confidence required to kick-start our campaign.
Don’t under-estimate the power of a well-crafted, clear and concise investor memorandum (IM). Or the time and effort that goes into fine tuning this financial document and honing your pitch. Not only is this type of financial disclosure a legal requirement in global equity crowdfunding, but also it can be icing on the cake if delivered after a smashing pitch. Even in business, people make quick judgements. Make sure your first impression is the right one.
For more information, visit www.eureeca.com