Startupbootcamp offers convertible notes for entire startup batches

Startupbootcamp is coming up with a new way of funding its startups. It lets angel investors invest in all ten startups from the Smart City & Living 2016 accelerator programme batch. This is done with convertible notes through crowdfunding platform Leapfunder.

Angels can invest in the startups separately or, more interesting, in the entire batch. With the latter, money will be spread equally among the startups.

Inspiration for the financial structure of the crowdfunding project on Leapfunder comes from the construction industry. It is set up as a limited partnership (commanditair vennootschap in Dutch), something that's pretty common in that sector due to several contractors.

Spread risk

"Investing in a batch of startups allows investors to spread the risk", said SBC partner Marc Wesselink to StartupJuncture. "Because sometimes you just don't know if a startup will succeed, even we don't."

On Leapfunder, the minimum ticket is 1000 euro and the maximum investment per startup is 70.000 euro. Wesselink thinks the startups together will raise between 400.000 and 500.000 euro.

When a large investor invests 100.000 euro in one of the startups, or the company is acquired, the notes will be converted to shares – as are the standard terms of Leapfunder.

Demodays

The Leapfunder project is due in 28 days, and is set a month before the DemoDay. "Demodays have changed, now it's just the beginning of a startup. So when the companies present themselves, we want them to have some financial support already so that they can create traction."

Wesselink looks back to a successful pilot with this new way of funding, when Startupbootcamp did the same with the E-commerce 2015 class: 50.000 euro per startup was raised.

There was only one problem with the construction: the AFM (Authority Financial Markets, red.) saw us as a fund. "We had to pay management fees, commissions, and let backers directly invest into the startups afterwards. Now we only have to pay some legal fees."

Abroad

If this turns out to be a success, Startupbootcamp is planning to do this for next accelerator programmes in The Netherlands as well. "Eventually we want to try it abroad, but these kind of models work different in every other country." Wesselink also stated he'd like other companies to try this model. "It doesn't matter who does it or how it is done. As long as startups are helped."

Read all about the Startupbootcamp Smart City & Living accelerator programme and their startups Cabture, Canard, De Vinderij, Dipper, MyStay, Nuklius, Parkeagle, Quicargo, theConstruct, Twingz, and Virgla. Image by Wikimedia Commons, CC-BY-SA 3.0