Crowdfunding is certainly not a new concept in Denmark, and many ingenious and innovative start-ups have been developed thanks to the funding raised on various crowdfunding sites. Crowdinvesting, however, is a new concept in Denmark.
Crowdinvesting, also known as equity-crowdfunding, is basically the same thing except the funds that backers bring to the table are an investment into the company as shares – which is not the case with traditional crowdfunding.
Crowdinvest.dk gives Danes the opportunity to crowdinvest for the first time, and the first company seeking to take advantage is Landmad, a food shop that aims to curb industrial-produced food by bringing local farm produce from small and medium-sized farms to its customers in more urban areas.
“This is the co-operative movement as per year 2016,” Louise Dolmer, the founder and head of Landmad, told TV2.
“As a starting point, this is a farmer and producer platform, but we want to include many more people in our farming family. The funds we will now attain via crowdfunding will be used to develop the business and provide even more opportunities for locals to get their produce out to consumers. And we can see there is real interest in this.”
Starting out in a Grenaa farm in Jutland, Landmad (Farm Food in English) existed for three years before it launched its franchise concept six month ago, allowing it to open nine shops across the country (two in Aarhus, and one each in Grenaa, Aalborg, Helsingør, Holbæk, Horsens, Roskilde and Silkeborg) with a tenth shop opening in Skanderborg on October 28.
Billions kicked around
For the uninitiated, crowdfunding works by raising funds from a large number of people as a form of crowdsourcing – with the backer usually getting a reward of some sort for funding.
The practice has skyrocketed in recent years, with an estimated 230 billion kroner being raised globally in 2015 – last month two Danish siblings set a new Danish crowdfunding record by raising 23.3 million kroner for their new electric bicycle project.
Søren Stenderup, the man behind Crowdinvest, has spent years getting the investment platform launched in Denmark.
“It’s been a long journey in Denmark. We are subject to financial legislation, so it has taken some time, but we are finally here,” he told TV2.