Robo-investment comes to early stage equity funding
Seedrs, the London-based equity crowdfunding platform, this week announced “Autoinvest”, a feature that brings robo-investment to early-stage private equity sector investors for the first time.
The move allows investors, who previously would have had to manually filter through Seedrs range of startups seeking funding, to automatically invest in a portfolio of companies, filtered by segment.
The service is the first to be offered in the increasingly popular equity crowdfunding space (Andy Murray is among the most prominent users of Seedrs), although automated investment services — which rely on computer algorithms to invest client assets — are increasingly being offered by traditional financial players.
(In 2017 total assets managed by robo advisors topped $200 billion according to BackEnd Benchmarking, more than double the figure for 2016).
How Does Seedrs Auto-invest Work?
According to the Seedrs team, getting started is fairly straightforward.
Users simply select the area of investments that they would like to invest in, such as AI startups, then a maximum investment amount is defined per crowdfunding campaign and Seedrs does the rest.
It appears that Portfolio Builder is currently the only available criteria for investors to select, which is based on an algorithm that finds well-funded campaigns (“Deals that reach at least 70% of funding target and a minimum of 100 investors”).
In addition, users can register interest in “Sectors” and “Personalised”, both of which possess similitude to index funds, which track a particular sector, such as energy or retail, for example.
Hint of Big Things Earlier this Month
The Seedrs team hinted at plans to create something new and innovative earlier this month via their Twitter account, saying: “As the pioneers of equity crowdfunding we like to create a first. Our latest innovation is another first of its kind making it even easier to invest in businesses you believe in.”
Announcing the release, Joel Ippoliti, Chief Product Officer at Seedrs, said: ““Understanding what our customers want is at the core of what we do. There are investors who want it to be quicker and easier to build a diverse early stage investment portfolio, but still want to have oversight and control over their investments. Bringing customisation and transparency to an auto invest tool such as this is a real game changer; there’s nobody else doing anything quite like it.”
Continuing to Innovate
Seedrs was awarded The Most Active Funder in UK private companies last year, with over 46,700 investments from 58 countries.
The crowdfunding specialist also launched a Secondary Market, aimed at providing more liquidity in early-stage private equity; the only fully functioning early-stage equity secondary market in the UK.