Funding Traverses Borders
Many a brilliant idea has failed to get off the ground because of minimal funding prospects. The same way in which our communication and engagement traverse borders, so too does out transacting and, now more than ever, funding options.
Traditional business and, indeed, financing models have been flipped on their heads given the global domination of fintech solutions the global potential that these unlock for many businesses. Gone are the days when the biggest decision a business needed to make was where to set up shop. SMEs and startups alike are harnessing the game-changing potential of funding solutions and proving that, just as they have access to the worldwide marketplace, so too, are there a world of options to help them along.
The power of the collective has really been demonstrated in the number of successful crowdfunding campaigns that have arisen in recent years. Raising capital through the collective effort of friends, family, customers and individual investors has expanded through digital means to include a literal global community of prospects.
A number of crowdfunding platforms have sprung up in recent years. One such platform, IFundWomen (IFW) offers a platform to connect women-owned startups and the people who want to support them. Michaella Estevez, spokesperson for IFW explains, ‘We offer immediate access to capital through a premium online fundraising experience, access to small business grants from corporate partners, expert business coaching on all the topics entrepreneurs need to know about and a network of women business owners that sparks confidence, accelerates knowledge as well as ignites action.’ Platforms like IFW help to close the funding gap by providing access to funding alternatives.
Blacklanta pay their own crowdfunding story forward. The platform was launched in 2019 with a vision to see a world where black businesses are heavily promoted and showcased accordingly to receive the same recognition as their counterparts. ‘At Blacklanta, we want companies, families and organisations to thrive in our community,’ says founder Raven Strode. ‘In an effort to mainstream that goal, we’ve curated a platform to support black-owned businesses based in Atlanta, Georgia. Our priority is to elevate the presence as well as positioning of black owners and their fantastic innovations, companies and brands. Also provide incredible job opportunities for everyone interested.’
Though noble ambitions, the journey hasn’t been easy. ‘In the early days of seeking funding, my biggest challenge was asking for money. This is typically a fear that most people have because in reality it’s very uncomfortable. I started to get over this fear when I realised that in order to be successful in anything, you have to ask for help. I also soon realised that people do want to help you. I read an article today that said, if you don’t put yourself out there, if you don’t ask for what you really want, the answer is no anyway,’ says Raven.
‘I went about using the crowdfunding mechanism because it’s a way to access debt-free capital and proves demand for your dream. It’s an excellent way for people to support you while you are building from the ground up. This was very important for me because it gives the community an opportunity to be involved in the process. It’s an amazing way for people to witness a concept from an idea into something physical first hand,’ Raven elaborates. Also, she adds, ‘It shows that anything is possible and this is how we’ll inspire the next generation to chase their dreams.’ The platform now boasts a directory for businesses, real estate, job listings and event postings. Coupled with that, the platform also sells Blacklanta branded gear.
‘With the amount of limitless talent and ability that the city of Atlanta has to offer, we created this site to focus on support, education, and growth to continue the movement of circulating the black dollar back into the community. I am currently crowdfunding through IFundWomen’s platform to bring the directory to life by opening a convenience store that will hold a majority of products from the companies in our growing directory,’ Raven says. ‘My advice to anybody that wishes to crowdfund is to start putting yourself out there and take people along your journey. Once people get a glimpse of what you’re working on and they feel connected, the ask will be easier to make.’
The primary benefits, according to Raven, for others in need of funding would be debt-free capital to jump start their project, exposure through a crowdfunding platform, building buzz around your product or service and making people aware of your mission. There are tons of personal benefits as well. It will help build confidence, increase focus/determination and it’ll push you to become the best spokesperson for your brand.’
Fintech has facilitated and assured transactions and financing across borders further allowing funding for businesses in the same way. Businesses irrespective of size, are then able to cherry pick their investor partnerships based on other motivations rather than mere proximity.
EVOS Esports’ story
EVOS Esports, formerly Zero Latitude, is a professional esports organisation based in Jakarta, with a vision to build the most influential and inspirational esports brand in Southeast Asia. From humble beginnings in 2016, the brand has quickly catapulted itself to high acclaim in the industry thanks, in part, to some initial and continuing investments.
Teng Jen Ang, EVOS Esports’ chief strategy officer explains, ‘We’re fortunate that we’re in a fast-growing industry and currently the market leader in Southeast Asia. So, there was a lot of investor demand during our previous fundraise.’ Though investor demand is high, the EVOS team has specific ideas about their business partnerships. ‘However, the corona outbreak did slow down the closing [of the deal] process due to travel restrictions which was the main challenge we faced,’ he adds.
According to Jen Ang, the gaming and entertainment industry in the region is still quite new. ‘We decided to seek out investors which were already more mature in this industry. This led us to our lead investor from Korea who has much more experience and expertise in this industry. Our founders have previously been in the venture capitalist (VC) space and were already connected to all the VCs both regionally and globally.’
EVOS currently boasts a number of teams across various popular esports such as Counter-Strike: Global Offensive, Dota 2, FIFA and League of Legends, among others. Teams span different country locations. Attention Holdings (ATTN), EVOS parent company, reported that it raised USD12 million last year in a series B round led by Korea Investment Partners. With this, expansion is planned. Jen Ang says, ‘The main reason most startups raise external funds is to scale their business and also tap into the connections and expertise of their investors. For companies who are operating in industries where an increase in capital doesn’t bring a drastic increase in revenue/metrics, we would still recommend them to raise lesser capital but from investors that can value add to their business.’
Jen Ang affirms EVOS’ stance saying, ‘For all other companies which are able to scale quickly from external funding, we still recommend choosing the right investors that are able to bring their businesses to the next level.’
According to its website, Australian based but globally renowned design platform, Canva, announced the close of a USD60 million funding round mid-2020. The startup has done so well that investors are keen to get involved and, to date, the platform has raised a total of more than USD300 million from investors further afield such as Bond, General Catalyst, Sequoia Capital China, Felicis Ventures and Blackbird Ventures. Investor Rick Baker from Blackbird, a renowned venture capital firm based in Australia said, ‘In a post-COVID world of remote working, we are seeing Canva’s original vision – a collaborative platform to provide all the elements to create great design – become even more powerful.
As a result, Canva has seen phenomenal growth over the past months, cementing its place as one of the fastest-growing SaaS companies in the world.’ Funding is used to fuel the hypergrowth the design platform has demonstrated and expand on the company’s original vision and meet users’ needs. Mood Rowghani, general partner at Bond adds, ‘The recent changes in our world have pressured organisations to embrace new methods of work and collaboration. As the lines between home and office have blurred, Canva’s digital design platform is empowering a new wave of productivity and interaction for businesses, schools, and non-profits across the globe. We have been thrilled to work with the team and are excited about what’s to come.’
Amanda Palmer and Kickstarter
Amanda Palmer is a best-selling author, songwriter, community leader and pianist working in music, theatre and art. According to crowdfunding platform, Kickstarter, in 2012 Amanda became the first musician to raise more than a million dollars on the platform, for the release of her solo album. 24,883 people pledged USD1,192,793 in just 30 days. Since 2015 Palmer has used the patronage platform Patreon to fund her artwork with an average of 15,000 willing patrons supporting her creations each month.
This works well for Amanda. Posting about her initial Kickstarter funding on her website, Amanda said, ‘It may be what makes me different, fundamentally, from a lot of pop artists. I’m almost never looking at the monetary bottom line. I’m always looking at the creative bottom line, the happiness index of my life and creative self, not the amount of dough I’ll have in the bank at the end of a project.’
Read related article on an interview with Henri Arslanian, speaker for WIEF thinkTALK on session on E-funding Avenues for SMEs: Borderless Financing and the summary of the session here.
Henri Arslanian is a speaker for WIEF thinkTALK session on E-funding Avenues for SMEs: Borderless Financing. Register for the virtual session on 24 June 2021.
Main photo by Bruce Mars on Unsplash.