Top 7 European Equity Crowd Investing Platforms
Equity crowd investing platforms allow businesses to sell parts of their company to the “crowd”. You invest small parts of money in a business and in turn receive equity in the company.
This is similar to how you would invest in the stock market. Except that companies that are looking for funds through crowd investing are not publicly listed companies, but most likely early-stage startups.
Through crowd investing platforms you get a chance to get involved as an early investor in a startup that you believe in and enjoy their success later.
You receive your investment back either in the form of profits generated by the company or after the sale of the company or of your shares.
Some of the crowd investing platforms that I like are below.
Seedrs is a UK platform where startups are looking for funding in exchange for equity in their company. Most of the startups on the platform are from the UK, although there are many from other parts of Europe as well.
You can invest small amounts of money (even 10 GBP) in startups you like and then wait for an exit opportunity to sell your shares for a profit. There’s also a secondary market where you can sell your shares to other investors in case you don’t want to wait for an IPO or for the business to be sold in order to get your investment back.
Crowdcube is another UK platform that has more than 600.000 members. It’s the largest community of crowd investors in Europe.
The startups pitch their ideas here similar to how they do it on Seedrs. Some startups even alternate funding rounds between the 2 platforms (Revolut did this).
There’s no secondary market where you could sell early your shares, but typically the startups describe their exit strategy and the time horizon for that.
Property Partner is a real-estate crowd investing company based in the UK that buys and rent real estate properties. You buy shares in a property that the platform either already owns or plans to buy. Later, you receive a share of the rental income in the form of a monthly dividend.
The company focuses on 2 directions: long-term returns generated by rent and short-term returns caused by market appreciation. You can choose the properties or investment plans that best suit your investor profile.
Abundance Investment is a UK company that lets you invest in green projects that contribute to a better world. The company uses the crowdfunded money to build green energy projects like wind turbines.
Investors buy debentures in these green projects and receive shares of the profits from the sale of green energy along with repayment of their initial investment. So, you’re not really buying equity on the company, but you’re rather investing in long-term corporate bonds.
Most of the investments available are long-term, 15 to 20 years, although you can sell your investment at any time on the secondary market to other platform investors.
Crowdestor is a real estate crowdfunding platform based in Latvia. It offers investors the opportunity to invest in real estate, energy, transport and startup projects from as little as 100 EUR. The investment annual return rates are around 15%.
The platform doesn’t offer equity for the investments, but rather fixed interest loans. The interest rates vary from 12% to 36%.
Crowdestate is a real estate crowdfunding platform based in Estonia. You can either finance or get funding for a real estate development project.
The minimum investment is 100 EUR and currently, there are more than 25.000 investors on the platform with an investment return of over 20%.
Each investment has a clear exit condition. It’s usually a specific date in the future, but it sometimes might also contain conditions like “a 30% increase in value” as exit conditions. All real estate development projects offered on the platform are ended with the sale of the property.
Envestio is another crowd investing platform based in Estonia. It offers investing opportunities from a wide range of industry sectors. The investments offered have a yearly interest rate between 12% and 22%.
It started as a private investment fund and switched to crowd investing in December 2017. They’re relatively new on the market, and they only funded their first project in February 2018.
The project’s terms are usually around 1 year long, but if you don’t want to wait you can sell at any time your investment back to Envestio (with a 5% penalty fee).