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.”
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
“Everyone is talking about how the retail industry is struggling, but I think it’s an incredible time because brands who are doing something different and innovative are setting themselves up for the future,” said @adamgoldston, who founded the luxury athletic brand @apl with his brother @ryangoldsten. The Goldston’s are part of WWD’s 40 under 40: a group of industry notables. See the rest of the list on WWD.com. (📷: @vsteves) #wwd40
@eyeswoon blogger Athena Calderone debuted her first-ever cookbook, “Cook Beautiful,” which is heavily centered on the presentation and visual expression of food. Pictured here are her miso glazed carrots from the book. Get the recipe on WWD.com. (📷: @johnny_miller_) #wwdeye