A Kiwi tech startup has jumped on the equity crowdfunding bandwaggon, and is hoping to raise $500,000 through PledgeMe to grow its social marketplace app.
SellShed is a free mobile app which matches buyers and sellers in their local communities for online trading.
It’s based on a geo-advertising business model and has seen more than 13,000 users sign up since it launched last October.
The company, based out of Mt Maunganui, has so far raised $300,000 in private capital fundraising initiatives, but further investment is required for SellShed to continue its national expansion plan.
PledgeMe, the equity crowdfunding platform, assessed the company’s potential appeal as well as future success and is now officially hosting the campaign.
Peter Howell, SellShed CEO, says the SellShed put their proposal forward to PledgeMe because the platform's due diligence and acceptance process provides additional credibility for capital-raising plans.
Crowdfunding was also a natural choice as it fits with the company’s brand.
“SellShed is about community involvement. Those that take up the opportunity will be investing in an exciting high tech start-up that will revolutionise how online trading is conducted in the future,” Howell says.
“We see this approach as a potential funding model for a lot of future online or app-based businesses in New Zealand, as it’s an ideal way to tap into investors who want to be involved in a project like this but may not want to go through traditional investment channels to do it,” he says.
Howell expects younger investors in the 30 to 40 year old age bracket to be interested in the offer.
“We’re expecting good uptake from people who have a reasonable investment income, and also a good understanding of online technology and its applications,” he says.
The SellShed app is targeted to a local audience and is integrated with all key social networks, free on mobile phones, and can be customised to user needs.
Its revenue model includes two streams - geo-advertising, which is based on the location of the user, and subscriptions, which will see businesses pay a monthly fee to cover listings.
SellShed will expand internationally in future, says Howell, although the initial focus is on growing the business within New Zealand.
“Because of the nature of the mobile platform there are no geographical boundaries. We already have users in New Zealand, Australia, UK, USA, Italy and Uruguay, although 99% of the users currently registered are Kiwis,” he says.