CircleUp has raised a $7.5 million Series A round of funding, which is believed to be the largest amount raised for an equity-based crowdfunding site.
The round was led by Union Square Ventures, whose portfolio of companies includes Twitter, Kickstarter and Etsy. Other investors in the round include Google Ventures, Maveron and Rose Park Advisors.
The round will enable CircleUp to hire more engineers and designers to build out the platform.
CircleUp is different from other crowdfunding platforms. Under its model, investors get equity in the investment, so the firms seeking equity stakeholders get vetted and angel and seed investors must get accredited before either one can access the consumer-focused crowdfunding platform. In addition, the average raise from the site is $1 million. In comparison, Kickstarter relies on pledges, or donations, from individuals. The average raised is $10,000.
According to Ryan Caldbeck, chief executive officer and cofounder of CircleUp, “Hundreds of investment firms invest in consumer product firms above the $10 million level, but there are almost none below that.”
He told attendees at the Next Great Consumer Brands Conference earlier this month, copresented by Consensus Advisors and The Nasdaq OMX Group, that so far CircleUp has helped 12 firms raise an aggregate of more than $10 million.
Caldbeck previously was at private equity firm TSG Consumer Partners before founding CircleUp. He said there are many investors with consumer backgrounds who have money to put to work but not necessarily access to companies that fit their investment profile. The platform helps to streamline that process.
David Krane, general partner at Google Ventures, has joined the CircleUp board. According to Krane, Google wanted to be an investor because it likes seed and angel investing — Google Ventures does about 50 to 60 seed investments each year. CircleUp got its attention because it is the “first of its kind with a focus on consumer companies.…This platform brings people together on both sides of the fence.”
Krane also pointed to the efficiency of the process that enables completion of due diligence and fosters investment decisions quickly at 61 days rather than the year or so that typically occurs in Silicon Valley for tech firms.
Dan Levitan cofounded venture capital firm Maveron with Starbucks Coffee Co. chairman and ceo Howard Schultz, and the two have an in-depth familiarity in the consumer space. Maveron’s portfolio of investments past and present include: Drugstore.com; eBay; Groupon; beauty firm Julep; activewear firm Lucy, and babies and children’s e-tailer Zulily.
“Maroven was the first institutional investor to commit to the company when it started 18 months ago,” said Levitan, who added, “CircleUp is a great accelerator for these [smaller] companies that frequently have a hard time to get access to angel and seed investors, many of whom have had previous experiences running successful consumer firms.”
Christy Prunier, founder and ceo of pre-teen skin-care firm WillaGirl Inc., who closed on a $1 million investment from several investors through CircleUp, said, “One investor now behind Willa comes from a consumer background and has experience investing in consumer brands. Another investor introduced me to my chief financial officer.”
London’s newly opened @designmuseum will look back on the life and work of Azzedine Alaïa in a show that the designer helped to curate before he died of heart failure last month. The retrospective, which Alaïa had worked on with Mark Wilson, chief curator of the @groningermuseum, will look at the impact of his work worldwide. The show, “Azzedine Alaïa: The Couturier,” will run from May 10 to October 7. Read more about the exhibit on WWD.com #wwdnews #wwdfashion (📷: @zefashioninsider)
@Pharrell and his wife Helen Lasichanh were among the stars that came out to celebrate @rimowa’s first pop-up concept shop. The space, which is located on Rodeo Drive in Beverly Hills, draws inspiration from airport luggage carousels and lounge areas – and features the company’s luggage and accessories. If the pop-up is successful it could pave the way for addition temporary shops throughout the world. #wwdfashion (📷: Owen Kolasinski/BFA)
@carineroitfeld celebrated @crfashionbook’s first calendar last night with a dinner party at Spring Place in Manhattan. Photographed by @stevenkleinstudio, the calendar takes on a fitness theme and features @joansmalls, @gigihadid, @danielle_herrington_ – pictured here – and more. “[Carine Roitfeld] wanted me to feel sexy and she wanted me to be myself and feel it out on my own and do what I felt was right,” said Herrington, aka Miss October. #wwdeye
@saintrecords and @virgilabloh last night at @americanexpress’ “A Night With Success Makers” event. “I always bring it back to community because without that I wouldn’t have the courage,” said Knowles when asked how she has gotten where she is now. Read more highlights from their conversation on WWD.com. #wwdeye (📷: @lizdoupnik)
This Just In: Industry sources have told WWD that Anastasia Soare is rumored to be considering selling her beauty business, @anastasiabeverlyhills. According to those sources, Soare has tapped investment bank Imperial Capital to explore sale options for her eponymous beauty brand –– and with at least $340 million in net sales, this would be a big deal. Put in context of other recent transactions for makeup companies, Soare’s price tag could be in the billions if she were to sell the whole thing. #wwdnews #wwdbeauty (📷: @clint_spaulding)
@assouline’s latest book, “The Spirit of Bentley: Be Extraordinary” captures the adventurous attitudes and opulent lifestyles of @bentleymotors’ most creative owners and enthusiasts throughout the U.K. The 292-page hardcover has a section dedicated to showing its team of skilled artisans and photos of its most colorful owners, from George Bamford to designer @alicetemperley, pictured here by Aline Coquelle. #wwdeye
@google released its report on the most popular search terms this year. For fashion brands, the list was led by @gucci, the luxury brand that stunned the market last October when it pledged to stop using fur. Runner ups were @supremenewyork and @fashionnova, along with more established brands like @louisvuitton, @chanelofficial and @ysl. #wwdfashion (📷: @aitorrosasphoto)
In yet another fashion show shuffle, @elleryland is moving its show in sync with the Paris couture calendar — though the brand is still keeping one foot on the city’s ready-to-wear schedule. Their runway show in January will coincide with the launch of a new strategy: designing two main collections each year instead of four, which will then be released in four drops. “As we all know, the system needs to change. We need to show sooner to give time back to artisans and designers to do what they do best — create,” said founder Kym Ellery. #wwdnews #wwdfashion (📷: @kukukuba)
@maxmara’s classic 101801 coat was the cornerstone of its pre-fall 2018 collection. The design team expanded the traditional double-breasted, kimono-sleeved style into a trapeze coat, lean belted styles and a peacoat and presented them in monochromatic looks – like the camel one pictured here. #wwdfashion #prefall18 (📷: George Chinsee)