LANDLORDINVEST has failed to reach its fundraising target on Crowdcube.
The peer-to-peer buy-to-let mortgage lender had been looking to raise £300,000 but only hit 40 per cent of its target by the end of the campaign this week.
Crowcube runs “all or nothing campaigns,” meaning a project is cancelled if the target isn’t reached.
“We do not know the reason for the lack of demand,” said Filip Karadaghi, managing director of LandlordInvest.
“It seems as any successful raise on Crowdcube requires a pitch to be almost fully funded by the company’s own network as very little funds came from Crowdcube’s investor base.
“We have seen this with other pitches as well.”
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Karadaghi added that the lack of funds would not affect development of the platform, and said funding was being sourced from elsewhere.
“The purpose of raising on Crowdcube was mainly to let our customers to become shareholders,” he said.
“We will now close the round privately and are in advanced discussions with several parties, including a substantial financial group.”
Last year the platform received an undisclosed amount of seed funding from London property investor Alan Gabbay, director of property investment firm O&H Properties.
“Crowdcube provides a platform for businesses to consolidate all sources of their investment from strategic investors, angels, VCs and institutions to their network and Crowdcube’s investor community,” a Crowdcube spokesperson told Peer2Peer Finance News via email.
“For many businesses that raise on Crowdcube, inviting their existing network of customers, fans and advocates to become shareholders, which drives long-term loyalty and engagement, is one of the main perks of crowdfunding.”