InvestmentsAug 1 2017

Andy Murray backed digital bank smashes fundraising target

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Andy Murray backed digital bank smashes fundraising target
ByHolly Black

A digital bank which counts tennis star Andy Murray among its backers and was looking to raise £4m from investors, has attracted more than four times the amount of funding it had hoped.

Investors have pledged more than £17m to back digital bank Revolut, through crowdfunding website Seedrs. 

Some 40,000 customers at the bank, which launched in July 2015, have registered to invest. 

Revolut, which has customers in 42 European countries, wants to raise money so it can expand into Asia and North America, as well as expanding its range of services in Europe.  

Customers who have a premium account with the bank have been given first access to investing in the fundraising, subject to a cap of £2,000. After the rest of the firm’s 750,000 customers will be able to invest up to £1,000. 

But pouring money into start-up businesses can be very risky. 

Ben Yearsley, investment director at Shore Financial Planning, said: “Crowdfunding is currently a hot topic for investors and, while I wouldn’t dissuade people from investing as the rewards for successful investments can be high, I would warn that these are higher risk, small companies which are more prone to failure.

“As a small shareholder in an unquoted business you have little say in or control over the business. Individuals should be sure to only invest what they can afford to lose.”

Revolut already had success raising cash through crowdfunding last year, when a £ 1m funding raising round was also over-subscribed.

The digital bank lets customers open an account in 60 seconds and make free international money transfers through an app.

Nikolay Storonsky, chief executive at Revolut, said: “We are incredibly excited to open our fundraising to as many members of our community as possible through our crowdfund. Word of mouth by our loyal customer base is the reason that Revolut has achieved so much in just two years.”

Some £230m has been invested across more than 500 campaigns through Seedrs.