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That's about the size of it. If you are looking at investing in them (I am as I think it is great) the most important thing is are they likely to be successful or not. If you think not then you have to think of any money you put in as a donation to support a dream of a slightly better world.
Assuming you think it might go somewhere the other thing that is important is the pre - money valuation, ie what they are saying it is worth before they raise the money. This is art more than science but is related to:
- what they are doing at the moment (how much revenue, passengers, etc)
- how easy it would be for someone else to copy (another start-up or Uber / Amazon bikes, City Sprint, Addison Lee, etc)
- what the potential is - how big could it be if it comes off
- what other similar companies have been valued at
Pre-money valuation dictates how much you get for your investment. They are saying what they have at the moment is worth £1.5m so, if they raise another £150k, that would make them worth £1.65m, meaning the total £150k was 9.1% of the post-money total valuation.
If they are too greedy, it could be successful but you could end up losing money, or not making much for taking the risk. If they are too generous, that's not good either as it weakens their incentive to work hard and makes it harder for them to raise more money next time. But valuation is a secondary concern to whether they will be successful or not.
Don't put any money in that you are going to be needing any time soon. The only guaranteed exit is when they either sell the company or float it on the stock market. That could be many years away or never. There may be a secondary market in the shares in a few months time but there is no guarantee. You might be able to sell at a profit if they do really well but you might not.
I registered for the early access and will put some money into it. Will take a proper look at the info and do a bit of research before deciding whether it will be a donation or an investment.
I've not used them, I never take taxis nowadays (and have never used uber), but have been looking for an opportunity to try them out since I came across them in twitter a couple of months ago.
- what they are doing at the moment (how much revenue, passengers, etc)
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frank9755
platypus
As I understand it, which may well be flawed... They release X amount of shares or percentage ownership of the company to sell to raise capital.
So they are looking to raise £150,000 and are raising that by selling 9% of their company as shares.
People contribute via crowd cube which will get them a percentage of a share or more depending on the amount. You only pay your money and get your stock if the funding round achieves the target figure.
I went in for £200 and it will only come out of my account when then have hit the £150,000 target.
You have very little chance at all of becoming a millionaire. You will most likely not see your money back. Unless everything goes exceedingly well and they make the decision to sell to one of the big boys who are on a tradable stock exchange, like Uber, for a whopping amount.
In which case your 0.13% ownership of the business (assuming they haven't diluted the share stock) might get your some money back.