We perform extensive upfront checks on every company that wants to pitch for funds on our platform. These include verifying details of the directors' backgrounds, reviewing the company's finances and a reviewing the company's business plan. We require evidence for every claim that a company makes in its pitch to ensure that every investor is in the best position to succeed.
Only 8% of companies that apply to pitch for funds on our platform have made it through our rigorous vetting process. At Crowd for Angles, we will only place a pitch on our platform if we believe that the company is trustworthy, reliable, has true potential and we would consider investing in it ourselves (indeed, for many pitches some members of our team have done just that).
While we don't endorse any pitches on our platform, we believe that our rigorous due diligence process will help you to feel confident in your investment. Here we outline our extensive process of checks into every pitching company.
We understand that our investors have put their trust in Crowd for Angels and we take this responsibility seriously. As such, we only offer financial products which meet our strict quality criteria. To read more about our due diligence process check out our “understanding our due diligence process guide” here.
When companies first apply to pitch for funds through our platform we expect them to provide us with the company name, company number and company status, as well as information about directors and the nature and history of the business. They may also submit a website or other information, along with working contact details for their directors and their place of business. The information we request at this stage is preliminary, and we expect applicants to provide much more detailed information if they reach a later stage.
At this stage we check all the information companies have given to us against records held at Companies House and other reputable sources. For directors we also check to see if there are any red flags, such as bankrupted or dissolved companies in their backgrounds, and run an identification and credit check using LexisNexis
We always make every effort to meet each company pitching on our platform. We're proud that we've been able to meet 98% of the businesses which have pitched so far.
For the companies that successfully pass the application stage, they are required to create a pitch for potential investors. For those which are not suitable for our platform, we make every effort to provide either an alternative fundraising home or provide constructive feedback that can help the business to progress in the future.
Are you a company looking for tips and tricks to survive your due diligence process? Here are five tips to get you started.
Companies now get the opportunity to build the final pitch that investors will see by completing up to 11 forms that are held on our platform.
At this stage, we ask applicants a detailed set of questions about their business. The information we expect is of significant detail and includes multiple questions in areas such as the company's growth potential, its team, products, competition, audience, finances, the risks involved, and the exit strategy, among others.
A pitch is a financial promotional, meaning any statements made on the pitch that are deemed factual require evidence. Evidence cannot include easily editable sources such as a company's website or personal social networks such as LinkedIn.
We will then perform checks on all the information provided. At this stage we will also exercise our judgment about the potential of the company's product and concept - while we do not endorse any pitch on our platform, we won't put a pitch online if we believe the concept is obviously poor.
With all companies, we require a set of up-to-date accounts and a balance sheet. Furthermore, we will check to see if there is any outstanding loan finance in the company and the terms of those loans.
While we don't provide advice to companies pitching on our platform, we do offer guidance. In general, we are inclined to encourage companies to lower their valuations if they don't seem accurate to us. We will also offer guidance on their fundraising targets - companies may sometimes set their target too high, and we encourage them to avoid this.
During the fundraising period, companies will not be able to edit their pitches on our platform. However, dedicated investors can be assured that the information in pitches on our website is always factual. Once the fundraise is complete, we work with a legal firm who will undertake further due diligence checks on the company prior to the funds being released. All investors are kept up to date with their investment on our platform and can withdraw their committed investment up to 7 days after they have first made it.