Elliot Moss
Good morning, wow I bet you are up and ready with that. That was James Brown of course and People Get Up And Drive Your Funky Thing. This is Jazz FM’s Jazz Shapers with me, Elliot Moss. Thank you very much for joining me. Jazz Shapers the place where you can hear the very best of the people shaping the world of jazz, blues and soul alongside someone from the world of business; a Business Shaper. My Business Shaper this morning I am pleased to say is Mr Luke Lang. He is the co-founder of Crowdcube which for those of you in the know is a crowd funding platform. If you don’t know about crowd funding now you will do by 10.00am. Lots coming up from Luke very shortly. In addition to hearing from Luke, you will be hearing from our programme partners at Mischon De Reya some words of advice for your business and on top of all of that to follow the brilliant James Brown some amazing music from the shapers of jazz, blues and soul, including Jason Moran, The Staple Singers, Miles Davis and this from the New York based, French born Serial Emmet.
Serial Emmet and Off The Wall from the most famous musician probably on the planet at some point, Michael Jackson. This is Jazz Shapers and you are with me, Elliot Moss and my Business Shaper today is Luke Lang; he is the co-founder of Crowdcube which is a crowd funding platform and I am now going to ask Luke himself, thank you very much for joining me, to explain what crowd funding is. Some people may know, other people may not. Give me a thirty seconds on the wonderful world of crowd funding.
Luke Lang
I am delighted to be here. I guess crowd funding is the way in which people, ordinary people, everyday people can back and support great British businesses so they can pool their money together to invest in start-up, early stage or growth businesses in a variety of different sectors and they actually become real shareholders and real stakeholders in that business. So that’s, that is essentially what crowd funding is done and it’s, I guess it has turned angel investing and equity investing on its head and made it a lot more accessible and affordable for the masses.
Elliott Moss
So basically it is alternative forms of investing in companies.
Luke Lang
Yeah.
Elliot Moss
And Crowdcube if I am not mistaken set up around February 2011. Is that right?
Luke Lang
That’s correct.
Elliot Moss
Was one of the first or now is one of the most famous names in that part of that industry. Is that right?
Luke Lang
Absolutely, I mean we have got a global reputation as a trail blazer so not just here in the UK or Europe but globally and we are one of the market leaders certainly in the UK we have funded more businesses than any other platform and raised more money than any other platform.
Elliot Moss
And just some stats for those of you at home, one hundred and seventy eight businesses have been helped in the course of your lifetime give or take. Probably closer to two hundred now.
Luke Lang
Yep.
Elliot Moss
And that is essentially, that’s helped them raise fifty million, over fifty million pounds and indeed in 2014 if I am not mistaken around ninety companies were helped and around thirty million pounds was raised.
Luke Lang
Well in the end it ended up being one hundred and five businesses that were funded for over thirty five million and in the last six months of the year, twenty five million of that was raised so you can get some indication of the growth and the acceleration of the industry.
Elliot Moss
Now you haven’t always, well you haven’t always lived in the world of finance and quite the opposite if I understand Luke; you’ve been a teacher, an English teacher in China.
Luke Lang
Yep.
Elliot Moss
My sources tell me. You’ve joined a business many years ago in the world of technology as head of marketing, in fact that’s your craft skill isn’t it? You are a marketer by trade as it were.
Luke Lang
Yep.
Elliot Moss
When did it become clear that you were going to do your own thing and why crowd funding?
Luke Lang
Well I guess I have always had a real interest, I mean the company, the IT Company Eclipse Internet was actually my brother’s company so I worked for him so there is entrepreneurialism within the family and I worked closely alongside Mark in those early days of when dial-up was turning into broadband and that boom was going on and that was tremendously exciting and thrilling environment to be involved in so I was always interested with the idea of starting up and setting up a business and entrepreneurialism. I guess it wasn’t until Darren came and sat next to me at that company Eclipse Internet that, that idea really started to start to take shape.
Elliot Moss
And this is your, this is your co-founder, Darren Westlake?
Luke Lang
Yes Darren Westlake is the co-founder and he came in one day with this, with this idea after having watched Dragons Den and he saw an idea that was being pitched to the Dragons and the Dragons didn’t like it but he thought it was a great idea but he didn’t have the money to invest in it himself but he thought ‘well there must be lots of other people that would be willing to participate and contribute a smaller amount of money and if we pulled that money together then maybe we could help businesses like that raise money’. So he kind of came to me with that idea and pitched it to me; which I thought it was a fantastic and great idea and a few years later we had taken that idea and developed it, worked on it in our spare time and eventually we ended up both giving up our jobs and going full-time in 2010.
Elliot Moss
Find out why they went full-time and what happened next. Time for some music, this is Honeysuckle Rose from Jason Moran and you may know that he is one of those people who loves to interpret the famous Fats Waller.
Some brilliant music this morning here on Jazz FM. That was Honeysuckle Rose and Jason Moran, as I said an interpretation of Fats Waller. Luke Lang is my Business Shaper today and he is the co- founder of Crowdcube and Crowdcube as you may have heard earlier is a crowd funding platform, lives on-line, helps you, me and everyone else invest in companies directly and with a real stake in it and a really close interest in what that business is doing. Has kind of shaken up the world of financing as you were saying earlier Luke. A challenge to the banks, a challenge to all sorts of people who historically have been in control of how companies get to money and you were saying that this moment happened – that the moment when the idea, the business idea was conceived when your co-founder Darren and you were sitting next to each other and he said ‘this is a great idea’ – two years later you give up your jobs. When you gave up your job to create Crowdcube full-time, was there a sense of ‘what have I done?’ or was it always ‘this is going to work?’.
Luke Lang
We always believed that the idea was going to work, you know, we were – we had done our research, we had done our homework. You know this was in 2010, this is in the midst of one of the worst recessions in living you know, memory. So there were a lot of people telling us this is possibly the worst time to be setting up a business and not only doing that but going out there and asking entrepreneurs to put their business on line and ask strangers to invest and then ask strangers to put money into – their hard earned money into businesses that they possibly had never heard of. But we were convinced that there was a real opportunity here, you know, the banks weren’t lending, grant funding had been slashed dramatically by the Government and angel networks in my view were completely and utterly broken, they weren’t doing the job that they are there to do which is to fund and finance early stage businesses so we really felt that there was an opportunity for crowd funding to grow and become, become huge.
Elliot Moss
How did you pay yourself or didn’t you? Because again it is a question I often ask and people go ‘and then I gave up my job’.
Luke Lang
Yeah so well we didn’t pay each other for quite some time actually so I used to do some freelancing in the background, Darren had some savings and sold his nice car so it was typical boot strapping, you know I often say that you know, our boots were so well strapped that we could barely walk. In those early days we got you know, we went to the traditional places where you go when you are looking to set up a business, you turn to your family members. So we got ten thousand pounds from my dad, ten thousand pounds from Darren’s dad. We used that money to get the business up and running and launched and our own savings as well. Once we had spent that money and we had got that live we turned to our brothers and brothers-in-laws and got a little bit more money.
Elliot Moss
You just kept going.
Luke Lang
We did try going to angel networks but they were completely hopeless and it wasn’t until later the year that we launched in December 2011 that where after we had funded several businesses on the platform that we actually put Crowdcube on Crowdcube and raised our own money through our own platform. So we raised three hundred thousand pounds which gave us enough money to be able to really kind of start to pay ourselves a small salary but also start to invest and grow the team and invest in marketing and the brand.
Elliot Moss
And in those early days and it sounds it properly is boot straps stuff – was there an amazing sense of elation as you saw that your idea was coming to life?
Luke Lang
Yeah absolutely. I mean it took over five months to fund our first business so that is a pretty tricky five months when you are trying to get investment and fund a business. That business raised seventy five thousand pounds which was a lot more than we thought the average would be. The third business that funded on the site a month later raised one hundred and eighty thousand pounds and the fifth business raised a million pounds. So very quickly we went from ‘does this work?’ to ‘this works’ – ‘blimey it’s really working’ to ‘crikey this can really, this can really go somewhere’.
Elliot Moss
And how much did you raise for your own business?
Luke Lang
Three hundred and twenty thousand pounds.
Elliot Moss
Which is what you needed?
Luke Lang
Yeah that’s what we needed at the time.
Elliot Moss
There you go.
Luke Lang
Since then we have gone on to do a couple more raises so we’ve most recently we raised five million pounds in total in the summer of 2014 and three point eight million of that was from a VC and we raised one point two million from the crowd and it took just sixteen minutes to raise that money which was pretty intense.
Elliot Moss
So if you have FOMO, ‘Fear Of Missing Out’, you had better get on to Crowdcube right now. Latest travel is coming up in a couple of minutes and before that some words of wisdom from our program partners at Mishcon De Reya for your business.
You are listening to Jazz Shapers with me, Elliot Moss every Saturday morning you can hear me interviewing a brilliant shaper from the world of business. If you have missed any, iTunes is your destination. You will find lots and lots there. Luke Lang is my Business Shaper today, he is the co-founder of Crowdcube which is a crowd funding platform which with the help of a VC or a Venture Capital injection of money, three point eight million pounds precisely, he himself for his own company through crowd funding raised one point two million pounds on top in sixteen minutes no less. So Crowdcube worked for Crowdcube and it is working for a lot of other businesses as I said earlier, around a hundred and five companies or so in 2014 alone. It’s an amazing story Luke. You are four years in and people know in this world of funding the name Crowdcube. We were talking earlier about the boot straps, we were talking earlier about the sense of elation. Have you hit the point yet where it is sort of not quite business as usual but now you are dealing with a slightly maturer business and if you are, how are you handling that? Because you are still a pretty young entrepreneur in years aren’t you?
Luke Lang
Thank you very much.
Elliot Moss
He looks great for his age, he has not just got a great face for radio I should say.
Luke Lang
I guess as the company evolves, it has evolved from just Darren and I where in the early days it was a real roller coaster ride, you know the highs seemed really high and the lows seemed low. As the years have gone on those highs and lows kind of, kind of plateau out a bit and aren’t quite so pronounced. And with the investment that we’ve raised into our own company is able to what we feel is build a world class team, you know, Crowdcube has grown from just fifteen people at the start of this year to forty five now. Some of those people have moved from Argentina to join Crowdcube. We’ve had people that have jointed Crowdcube and relocated from London to Exeter whose previous jobs were EBay, Amazon and Rated People.
Elliot Moss
What’s pulling them in? What do you think it is that they are attracted to because these are big companies that these individuals are saying ‘that’s not good I am going over there?’
Luke Lang
Well I think they understand the philosophy and the passion behind what Crowdcube is and what we are trying to do. You know, we are really trying to democratise investment and shake things up and change things we believe for the better and enable ordinary, everyday people to invest and back British businesses and we are starting to get some real traction as well you know, the names and the sizes raised are growing but we are attracting the proven entrepreneurs, serial entrepreneurs you know, Sir Stellios raised money for his latest Easi Group business, EasiProperty through the site earlier this year. Ex-Poundland founder, Steve Smith has used us to raise finance. We’ve had Hugh Fearnley-Whittingstall with River Cottage has raised a million pounds, that took just a couple of days and most recently Eden Project, which is a world renowned tourist attraction and environmental site, you know they raised one point five million pounds in just twenty hours. So you are starting to see real well-known brands that are raising finance through Crowdcube and really well established entrepreneurs and I think you know, there is a tremendous buzz around Crowdcube and crowd funding and what we are doing but we are also, you know, we are making a real difference not just to those big companies but also to the smaller entrepreneurs that are looking to raise that start-up and early stage funding.
Elliot Moss
Now it sounds like you are a man on a mission and sometimes I, you know, when I am having these conversations I see people whose eyes are full of pound signs and dollar signs and other people who have got real zeal.
Luke Lang
Yeah.
Elliot Moss
When you set out to do this I imagine it was a good business idea but you weren’t necessarily on the mission to democratise funding but it sounds like you’ve kind of drunk your own cool aid in a good way. Is that right? Do you feel a bit more it’s not just about the money is it?
Luke Lang
I think that’s right. I think Darren and I originally set out to kind of help other entrepreneurs raise funding and we felt that there was a real funding gap that existed in the UK and we wanted to help those businesses raise the money they needed to go on and flourish and we wanted to give British people the opportunity, ordinary British people, the opportunity to invest in British businesses and they can do that from as little as ten pounds you know. When we said we wanted to democratise investment we really really meant it and you know, ten pound minimum investment amount really really does that. But you are right, we’ve kind of, we’ve become the spear head and the trail blazers behind a revolution almost of alternative finance that goes into debt finance and pier to pier lending as well as, as well as equity finance and crowd funding. And I don’t think Darren and I necessarily when we started out thought that we would have gone to Number 10 a number of times and been in and out of Whitehall and gone to the Houses of Parliament and The House Of Lords and Buckingham Palace and things like that. That wasn’t really…
Elliot Moss
That wasn’t in the plans.
Luke Lang
…that wasn’t in the plan but they are nice kind of milestones along on the journey but I guess what really excites us is funding great businesses, helping great businesses raise money and giving people the opportunity to invest in businesses and I have to say the last three or four years we have really been creating this opportunity and I have never been more excited about Crowdcube than I am right now you know, I think having created the opportunity this you know, great opportunity has presented itself. The market has really evolved and developed and matured. We’ve got a fantastic team in place and we are just going to go out there and grab that opportunity.
Elliot Moss
Stay with me for more from my fantastic Business Shaper, Luke Lang, the co-founder of Crowdcube. Time for some more music, this is the wonderful Miles Davies with Milestones.
That was Milestones from Miles Davis. Luke Lang is my Business Shaper today, the co-founder of Crowdcube. You talked about the next phase. As you look back now have there been people in the previous phases, important people to you that have given you advice which has stuck, which has really seen you good over the last few years or has it all been a kind of a joint effort between you and Darren? Have there been outside people that have been important to you?
Luke Lang
Yeah I mean there are always are, I mean your close friends and family are always important I think; I think it is really important for every entrepreneur to have a good support network, not just within the business but outside it. Darren and I make a formidable team but I think…
Elliot Moss
You’re scary are you, you two?
Luke Lang
…no I think we just…
Elliot Moss
That’s good, you complement each other.
Luke Lang
…we work, we work together. Yeah we complement each other very very well and it helps when you are building a business that is disruptive and transforming an industry, you come under a lot of attack from the incumbents that are being disrupted so it can be, it can be good to have someone else around you to, to share that burden but also to share the highs as well. And I think you know, someone said to us you know, very early on, you know you are on to something here, this is a great idea, you have just got to be tenacious with it. You’ve got to, you know there will be lots of people along the way that say you can’t do this and you can’t do that and you shouldn’t do this but you just stick to your guns and you deliver against what you believe and you hold true to your values and Crowdcube can go on and be an exceptional company.
Elliot Moss
And that tenacity and that sense of values, are they called upon every day? Have you felt since the beginning or are – you mentioned the highs are slightly lower and lows are slightly higher and there is a bit of a plateau. Do you still feel yourself having to dig deep and go ‘this is my business I’ve got to protect it?’
Luke Lang
Yeah absolutely. As a co-founder you always feel that paternal sense of looking after your company and your brand and your employees and Darren and I are really passionate about creating a team with a really strong culture that reflects our values and our desires and our passions to help businesses and to try and do things in the right way so you are constantly a guardian of the company and how it is presented to the world and how it acts.
Elliot Moss
We will have our final chat with Luke today plus play a track from The Staple Singers – that’s after the latest traffic and travel here on Jazz FM.
I bet you were singing along to that, I was. It was I’ll Take You There from The Staple Singers. I absolutely love that track. Luke Lang is my Business Shaper just for a few more minutes. The co-founder of Crowdcube as you should know by now if you have been listening. You talked about disruption and you talked about transformation or a transformative business. There aren’t many times in industry when that happens, maybe Apple did it to the PC world, maybe First Direct did it in the banking world. You’ve really done it, crowd funding whether you were the first or not I don’t know and you can tell me, it doesn’t really matter if you were or weren’t, your take on that business has been transformative and disruptive. How does that make you feel because you’ve actually, you know, you are going to look back in fifty years and you will have been the guys that made it happen. Do you think about it or are you too involved in getting on with it?
Luke Lang
We try not to think about it too much. Days at Crowdcube roll into weeks and rolls into months you know it is so busy and so hectic. You are aware of the effect that you are having, you know, funding a hundred and five businesses last year and those businesses will go on and create thousands of new jobs for the economy and hopefully have a real impact on the economy and so you, you are constantly aware of this and you are aware of the fact that you know many of these businesses would have really struggled to find finance without Crowdcube and without Darren and I’s determination and tenacity in the early days so you are aware of that but Darren and I are quite humble people in a way. We don’t necessarily go out there looking to be these kind of business leaders, we are kind of, we never – we don’t normally seek out media opportunities.
Elliot Moss
I made him do it basically.
Luke Lang
Yeah. He made me do it.
Elliot Moss
That’s what you are telling me. And actually on that point, I mean interesting about you talk about humility. I imagine when you reference values, that’s one of them in your company.
Luke Lang
Yeah.
Elliot Moss
What would be the other most important thing that you are telling your team of forty five that’s growing to be like every day as they deliver the Crowdcube proposition?
Luke Lang
Well I mean our team is all about kind of shared experience in trying to help and support the team because it is growing rapidly in a short period of time and we’ve got some people that have been there a long time and we’ve got some new people that are coming in and new people that will come in in 2015 so it’s all about team work and working together because you know, we feel that we’ve got an amazing group of people that are tremendously passionate you know, Crowdcube is quite easy to get passionate about because you are helping businesses raise finance whether they are start-up, early stage businesses or more established well-known brands which is exciting in itself because these businesses have all got their story and they have all got their vision for the future and you are helping them to, to realise their potential but also you are helping investors back and support these. So it’s a fantastic business to be involved in and it’s a really easy business to get passionate about and we are very privileged to have such a broad group of people that stretch from Exeter where our head office is, we’ve got an office in London, we’ve got an office in Edinburgh. They are all incredibly passionate about what we do and that extends to our community of investors, you know we have got a hundred and twenty five thousand registered investors all looking and hungry for the next investment opportunity whether it be lending to a more established business like Eden Project or investing in a great kind of think tank entrepreneur coming out of Shoreditch so you know, that community is growing and that community is tremendously passionate.
Elliot Moss
One last question before I ask you what your choice of music is. The innovation, the transformation at the centre of your business that you brought to the industry and to funding British business as you said. How do you ensure that you are innovative every day and how will you ensure as you look at the future of Crowdcube that you will still be able to turn around and say ‘we didn’t rest on our laurels’. What are you doing about that to ensure that you have a fantastic future?
Luke Lang
Yeah well innovation is kind of in the DNA of Crowdcube, you know, it’s every day we are looking at how we can improve, how we can improve the experience for investors, improve the experience for entrepreneurs, how we can innovate and develop new products, you know the launch of our new mini-bond product which allows people to lend to more established businesses, like River Cottage, like Eden, like Chilango, you know these are innovations that we have kind of taken on where we are trying to disrupt a new market.
Elliot Moss
So basically the message is you ain’t gonna stop? Watch out because there is lots more coming.
Luke Lang
No not at all. You know as I said earlier, you know, I have never been more passionate about Crowdcube than I am today after four hard years of work and I am looking forward to the next four years because they are going to be super exciting.
Elliot Moss
Fantastic. Brilliant stuff Luke. Thank you so much for being my Business Shaper. Just before I let you go as I said – what is your song choice today and why have you chosen it?
Luke Lang
Anything from Art Blakey, I am a massive fan and I think the tempo and the rhythm behind Art is fantastic so…
Elliot Moss
Well we have given you, we have given you Moanin’ from Art Blakey and I reckon that is a pretty good one for you.
Luke Lang
It is.
Elliot Moss
Here he is, thank you so much.
That was Moanin’ from Art Blakey, the song choice of my Business Shaper today, Luke Lang. Down to earth, a man interested in transformation and someone who is retaining his humility in spite of the fantastic success that Crowdcube is realising right now. Fantastic stuff. Do join me again, same time, same place, for another edition of Jazz Shapers, that’s next Saturday morning 9.00am sharp here on Jazz FM. In the meantime though stay with us because coming up next, it’s Nigel Williams.