Where to start, how to proceed
IDEA, CAMPAIGN, PROJECT
There are three terms you need to understand before attempting to raise funds via the WinnersFund Platform. The first is “Idea”, the second is “Campaign” and the third is “Project”.
So let’s explain what these three words mean and why they are important: WinnersFund is a Crowdfunding platform for people who wish to materialise business (i.e. profit-making) Ideas. To this end, you need to initiate a Crowdfunding Campaign in order to get funds for a Project that is based on this Idea. This can be done through an existing Company, or a new one that you will establish, stipulate and govern after you get the funds, e.g. ‘ABC Ltd’.
Think of the following example. You have invented a device that maximises the efficiency of solar energy plants (the“Idea"); you therefore initiate a Crowdfunding "Campaign" in order to get the funds needed for mass production and marketing of the machine ("the Project"). Once the Crowdfunding Campaign becomes successful, the Project will be materialised by the Company ‘ABC Ltd’ (your Company) that you promised to establish in this event.
NATURE OF PROJECT
The Idea behind the Project is required to have a certain degree of creativity. This can be business oriented, art related, scientific or any other. Campaigns for “fund my life” projects, that being covering home expenses, tuition fees, holidays etc., are not eligible. Also, several regulatory restrictions apply regarding non-profit (e.g. charity) and specific cause funding (e.g. fund raising for Non-Governmental Organisations, political or awareness campaigns etc.). Thus, if you are thinking of creating a non-profit Campaign you should contact us BEFORE using the Platform. This is only to prevent you from wasting your valuable time in drafting a Campaign for a project not eligible for listing in WinnersFund.
WHO CAN START A CAMPAIGN
WinnersFund does not accomodate personal Projects, regardless of the returns you wish to promise. You may start a Campaign as an individual (natural person) only if you promise to register a Company and open a Company Bank Account in case your Campaign gets successful.
CURRENCY (...and why the Euro?)
All monetary values and contractual obligations are represented and undertaken in Euro (EUR). For ease of use, the Platform may convert or display any amount in GB Pounds Sterling (GBP or “Pounds”), US Dollars (USD or “Dollars”) or any other currency. However, the Euro remains the Platform’s single underlying currency. The Euro is used as the base currency for regualatory reasons, since all applicable European legislation (MiFID, Prospectus Directive etc) expresses monetary values solely in Euro.
HOW MUCH YOU MAY RAISE
By drafting and initiating a Crowdfunding Campaign yourself, you may raise any amount of capital from 24,000 up to 5,000,000 Euros for a Project that will be materialised in any Eurozone country, or the equivalent in Pounds for a Project that will be materialised in the UK. If you wish to offer Equity you should first consult our Campaign Reach page. If you wish to raise more than 5,000,000 Euros you should contact us. At present, we cannot host Campaigns for Projects that intend to be materialised in any country other than the Eurozone countries and the UK.
WHAT TO OFFER IN RETURN
All WinnersFund Campaigns are hybrid in nature. This means that you may offer your potential Funders any mixture of returns, choosing from a combination of Equity, physical Rewards (like end-products or services) or moral Rewards (like "a Big Thank you"). Due to the nature of Crowdfunding, there is no all-inclusive list of eligible returns. However, as regards to financial returns, excluding the shares (Equity) of the Company that will bring the Project to life, no other financial returns can be offered (e.g. interest rate payments, bonds, derivatives, third party shares, tradable stock, memberships in collective investment schemes etc.). Of course, the offering of illegal or immoral rewards is also not allowed. The characterisation of the latter remains at WinnersFund’s sole and unquestionable discretion. You also cannot offer or accept sex-oriented materials and services, regardless of their legitimacy in the legal domain.
For more details regarding the acceptable returns in general, please refer to our Terms of Service.
HOW MUCH TO OFFER
There is little to explain on Rewards. What you need to consider mostly and calculate very carefully is the funds requested for every Reward unit, that must be enough to cover for all expenses associated with its supply and disposal to Funders, and also leave adequate revenue for the financing of your business Project (that's what you run a Crowdfunding Campaign in the first place, right?).
NATURE OF RETURNS
All the returns you promise via your Crowdfunding Campaign are actually independent promises made to each one of the prospective Funders. If your Campaign gets funded
MINIMUM AND OPTIMUM FUNDING TARGET
WinnersFund not only offers you the unique choice to ask for the Minimum amount of financing that is absloutely crucial for the materialisation of your Project, but to also ask for the Optimum amount, which includes additional funds whose availability will boost the Project's efficiency or profitability (only you, the Project Owner, state how much should be included in the Minimum or the Optimum). The Campaign runs in 1 or 2 consecutive funding Rounds, depending on its success pace (please see below). If less than 30% of the Minimum funding target is achieved during the 1st Round, the Campaign is marked as "unsuccessful" and closes without any funds to change hands. Otherwise, you pass to the 2nd funding Round. What you still have to achieve by the end of the 2nd Round is at least the Minimum (but now, by 100%) in order to get funded. On the contrary, whatever amount is achieved at the end of the 2nd Round above the Minimum, even beyond the Optimum, is included in the total financing your company shall receive.
FOR HOW LONG
Campaigns run, in other words are open for fundraising, for a flat period of 40 + 40 days maximum (the Campaign duration). This is counted from the day of first publish and does not exclude public holidays in the UK or any other country. The fundraising period is divided in two Rounds, each one lasting for 40 days: during Round 1 you aim to collect the "Minimum" amount of money you pledged when drafting the Campaign. If you manage to do so by at least 30%, you automatically continue to Round 2, which lasts for another 40 days. In case your Campaign skyrockets and achieves the Optimum funding target during the first 40-day period, it closes successfully at the end of Round 1 (i.e. does not continue to Round 2).
...are considered those that achieve not less than the Minimum funding target within the Campaign duration.
WHEN YOU GET THE MONEY
When a Crowdfunding Campaign successfully finishes Round 1, the Preparation Period starts. This includes a series of legal procedures, documentation and compliance checks that have to be undertaken prior to the passing of money to your company’s Bank Account, directly from your Funders (WinnersFund does not hold or control Funders' or client money). The duration of the Preparation Period depends on a variety of factors, such as the complexity of the Project, the country of your residence, the country where the Company is or will be established etc. It is reasonable to expect that this period will last for a minimum of one (1) month to a maximum of six (6) months following the successful closure of the Campaign's 1st funding Round.
WHO HOLDS THE MONEY IN THE MEANTIME
As already said, WinnersFund NEVER holds or controls Funders' or client money. Money flows occur either directly from your Funders to your Company's Bank Account through our preferred Payment Processor, or remain for some time during the Preparation Period at the custody of a licensed third party (when required). The adopted way depends on the nature of the Project and the size of the invested amount.
WHAT TO READ FIRST
You should not start drafting a Campaign before you read our Idea Protection Tips, unless you hold a Patent and really know the steps that you need to take before publicising your business Idea.