Crowdfunding platform Crowdcube saw revenues jump and losses narrow in 2018, as big investment in technology helped spur growth while also cutting costs.
Accounts filed with Companies House show that Crowdcube, which is by most measures Britain’s biggest crowdfunding platform, saw revenue rise by 40% to £5.2m ($6.8) in the year to September 2018. Losses narrowed from £4.6m in 2017 to £3m.
Crowdcube co-founder and chief marketing officer Luke Lang told Yahoo Finance UK 2018 was a “tremendously exciting year.” He said the company has invested in redesigning its core technology, which allowed it to host more crowdfunding campaigns without seeing a rise in costs.
The company, founded in 2011, in fact reduced its headcount from 79 to 65 people between 2017 and 2018.
The number of funded companies rose by 66% to 195. A notable fundraising on the platform in the period was boutique hotel booking platform Mr & Mrs Smith, which raised £6m in September. In total, £180m was pledged for investment over the platform during the period.
“We’ve cemented Crowdcube as a mainstream source of finance for ambitious high-growth businesses,” Lang said.
Crowdcube is targeting £10m in revenues this year and is hoping to turn its first profit in 2019, Lang told Yahoo Finance UK.
However, the company flagged Brexit as a potential risk. The directors wrote in the accounts: “Both Brexit, and period leading up to Brexit, could have a negative impact on the Group. In particular, the uncertainty regarding Brexit may result in some potential issuers delaying plans to raise funds via the platform.”
Lang told Yahoo Finance UK that Crowdcube had a good pipeline of deals so far in 2019 but said it was difficult to forecast much more than sixth months in advance. He added that businesses liked certainty and that a resolution to Brexit either way would likely spur activity on the platform.
Crowdcube had a record end to 2018, including a £20m fundraising by app-only bank Monzo in November. Lang praised Monzo for “raising the bar on what is possible” and attracting bigger funding rounds to the platform.
Oscar Williams-Grut covers banking, fintech, and finance for Yahoo Finance UK. Follow him on Twitter at @OscarWGrut.