WantMyBet crowdfunding failure reflects sector difficulties

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Social betting and tipping site WantMyBet failed in its bid to crowdfund its business via a campaign on the Seedrs platform, reflecting the difficulties faced by the crowdfunding sector in the UK this year.

WanyMyBet launched a crowdfunding effort in the summer to raise over £200,000 for a pre-money valuation of around £1.7m. The effort failed to ignite the necessary investor interest and founder Olly Joshi told GamCrowd it was partly due to issues around timing.

“The fundraising wasn’t as successful as we had hoped,” he said. “We were a bit impatient and time just wasn’t on our side. Before you go live on a crowdfunding platform, you should really have around 30% of your target already pledged, in order to give it some momentum when you put the offer live. But we just didn’t have the time, so we went live with about 10% pledged. We just didn’t get the momentum.”

The WantMyBet experience reflects the troubles being faced by the UK’s crowdfunding sector generally. According to research from high-growth company investment data service Beauhurst, the number of deals which succeeded via crowdfunding platforms fell 20% in the third quarter, reflecting a broader slump across the UK.

The report said that the uncertainty caused by Brexit was largely to blame for the lack of deals in the early-stage investment area. “With many high-growth companies facing questions over access to markets and talent we think that uncertainty is breeding caution and that’s impacting both supply and demand for investment across the board,” said Toby Austin, chief executive and founder of Beauhurst.

The number of crowdfunding deals fell to 66 in the quarter out of a total of 249 early-stage funding deals noted by Beauhust. The good news was that the total sum of money invested in early-stage businesses and start-ups rose by 5%, up to £817m, but this was flattered by one deal, the £210m raised by food delivery outfit Deliveroo in August.

Total deal numbers slumped in September to just 71, down from 105 in August. Of the money raised in the quarter, 8% came in for seed capital, a further 25% came in at the venture capital stage of investment and 67% of the total was dedicated to further growth investment rounds.

WantMyBet’s Joshi said the company’s crowdfunding effort had not gone to waste as it has attracted the attention of Graham Martin, the chairman of Australian-based investment group Cardinal House. The two are now working on a joint venture to produce a version of the WantMyBet site for the Asian and Australian markets. “Graham Martin (chairman at Cardinal House) saw the offer of Seedrs and got in touch,” he says. “So the offer served its purpose – it got us noticed”.

Martin recently joined the board of another tipster-related startup, Leeds-based Equotion, which utilises big data to identify value horseracing bets. Martin took the role of non-executive chairman.