FinTech Interview Series: Dan Hardy at CrowdCube

Tell us about yourself.

I work at Crowdcube, a world-leading equity crowdfunding platform, where I help early stage companies raise investment. I spend my time identifying the right companies for Crowdcube and coaching them through the fundraising process; in the past 3 years I’ve been involved with raising nearly £40m across a range of sectors.

Tell us about Crowdcube

Crowdcube started out with a simple mission, to democratise investment in early and growth stage businesses. Giving fans and customers of small businesses the chance to invest in their growth, an asset class that had been historically only available to the traditional investors.

We have raised more than £600m for companies across all sectors and worked with companies such as Camden Town Brewery, Pip & Nut and Witt Energy. We have more than 800 companies in our funded club, have taken investment from over 125 countries across the globe and have built a nation of armchair investors!

You’ve been fortunate to work with a lot of the UK leading FinTech’s - what are some of your favourites

I would have to say WiseAlpha. For those of you that don’t know Wisealpha, they aim to be a world's first lending market, offering everyday investors access to senior secured and high yield investments. They are truly disrupting a market place that, until WiseAlpha was only available to corporate investors. Their ethos echoes of our own, one of the reasons I joined Crowdcube was because of the vision to democratise investment: make opportunities traditionally reserved for the elite, open to everyone. WiseAlpha are doing this on the other side of the market (debt via bonds) and that's one of the reasons they are my favourite.

You are started in the UK - do you think that your model will transfer internationally?

Absolutely, the question isn’t if but when. We have been fortunate enough to work with the FCA in building regulation around crowdfunding as the industry was built and grew, unfortunately other regulators haven’t been so forward thinking. However, the winds of change are blowing, and you can see examples in the US, Australia and parts of Europe that are starting to open their regulation to the possibility of crowdfunding.

We have already partnered with the US’s largest crowdfunding site, SeedInvest, to open that market and we are funding more and more European companies. With an office in Spain looking after southern Europe (mainly Spain & Portugal), we are certainly planting the seeds of world domination, but really we are focused on the huge amount of opportunity that remains in the UK market.

How has the sector changed since you started?

A great deal, the industry is extremely different even in the 3 years that I have been here. The maturity of the industry has been stark on several front. Firstly, deal size. When I first started, raising £1m through our site was a serious under taking. In contrast, in 2018 we funded 33 £1m+ deals and Monzo raised £20m in 5 days. More and more companies are starting to realise the power in crowdfunding and seeing the art of the possible, I’m confident this trend will continue.

The number of investors is another good example of how the industry has grown. In my early days achieving 500 investors was a huge feat. However, in the space of a month, Chip broke the record for the number of investors in a round, previously held by Revolut (only for Monzo to blow it out of the water with 36,000 investors!)

Lastly, unicorns. The thought of startup unicorns being amongst Crowdcube's funded companies seemed crazy a few years ago, but now we have Brewdog, Monzo and Revolut in the ranks, long may it continue!

Is FinTech actually different? We've always been consumers and developers of technology in financial services.

I don’t think it has changed but it has certainly picked up pace. Startups relentless focus on improving customer experience and a complete disregard for the incumbents has shown the Financial Services industry as rich soil for growth.

People won’t stand for bad service or hidden fees now, it's exciting to see tech companies operating in the financial services space to bring better experiences for users. We truly are in the era of the entitled customer.

Can regulation keep up?

In the UK, absolutely. I think this is one of the main reasons for the growth in Fintech, it certainly was for crowdfunding. You only need to look at things like the FCA’s sandbox as proof of how they are trying to work with companies to create regulation.

Is the London-based FinTech machine losing steam?

No, I don’t think so, I would even go as far as saying that it’s probably going to get stronger. London has morphed itself into one of the best locations in the world to start and grow a Fintech business with an amazing infrastructure of incubators, accelerators, investors and regulators.

I do think that after some amazing years of investing in Fintech several sub-sectors are facing likely consolidation but overall, I can only see it going from strength to strength.

What are your favourite FinTech innovations?

Revolut – I’m an avid user and brand advocate. I love their focus on customer experience and still can’t quite believe the speed in which they can turn out new products but when you see things like their travel insurance product, you just have to tip your cap. Everything they do starts with the customer and works backwards.