New crowdfunder Liftoff fails to fly on first outing with eco-tour business
Liftoff, a new crowd-funding platform, has failed to fly with its first offer, raising just $2500 of the $1.2 million sought.
The campaign for Rainforest Experiences, which provides eco-tourism tours in the North Island's Whirinaki Forest, fell well short this week of the minimum target of $600,000, attracting only three investors after 35 days.
Liftoff's website confirms the offer has closed but gives no indication of the outcome and an "oops an error" message flashes up when the offer is clicked on. Liftoff said it was getting that "fixed today".
The licenced platform, the sixth in New Zealand, aims to help build Kiwi companies and provide support and services to Maori to help their businesses. It was started by New Zealand Shareholders' Association founder and accountant Bruce Sheppard, Andrew French, a former trade commissioner who is now a director of the Crown Forestry Rental Trust, and former Inland Revenue staffer Adam Hunt.
Mr Sheppard was also a member of the establishment board for the Financial Markets Authority, which oversees the crowdfunding sector.
Mr Hunt said it was a disappointing start for the new platform.
"We fully acknowledge we got it wrong and the process taught us a lot," he said. "We hope the current membership deal for Famous Vodka will go better and we have a number of equity offers in the pipeline that we will release as the time is right. Like any start-up, it's important to take the knocks, learn and move on. That's exactly what we will do."
What it will do differently next time is to open an offer with a high net worth cornerstone investor already in place, Hunt said.
The platform's licence differs from others because it's based on a partnership approach. Two of the shareholders – Whenua Capital and Gilligan Sheppard – are also partners who will bring in key investors to crowdfunding offers. Another two partners will be announced in the next couple of weeks, Mr Hunt said.
Crowdfunding is only one part of the overall fundraising service that Liftoff offers to Kiwi companies wanting capital to grow and it will still keep working with Rainforest Experiences to find the money it needs, Mr Hunt said.
It had a database of about 25,000 conservation people he thought would have been interested in supporting "what could turn out to be the North Island's Milford track" but they failed to respond to the Rainforest Experiences offer.
Liftoff's membership offer for Famous Vodka has so far raised $11,830 or 8% of the $150,000 goal, with 24 days to run.
Started by Simon Bruce and Justin Bennett, the three-year-old Kiwi vodka company wants funds to widen its distribution, scale up, find new bottle production partners, and start exporting. Colin Mathura-Jeffree is said to be the face of the brand, which is sold in major liquor outlets nationwide and distributed through Gilmours to more than 150 nightclubs and bars.
In exchange for their money, crowdfunders are being offered membership at varying levels of the "Famous Club." Membership benefits include free T-shirts, free entry to Famous Vodka parties, and product specials.
Another new equity crowdfunding platform, Crowdcube, succeeded with its first offer last month, raising $470,700, above the minimum $200,000 but below the $1 million sought for Collect, which sells a marketing app for retail stores. It has another campaign still open for Roam, a peer-to-peer car sharing marketplace which is seeking $390,000.