Founders Future, a well-known venture capital firm in the French tech scene, has made an intriguing move by acquiring Sowefund, an equity crowdfunding marketplace. While the terms of the deal have not been disclosed, Sowefund has been profitable since 2022 and has a team of around 20 employees.
This acquisition now positions Founders Future as the owner of two separate yet complementary businesses. On one hand, with its venture capital funds, Founders Future raises funds from limited partners, including professional investors and family offices, and then invests in promising startups. On the other hand, Sowefund’s crowdfunding platform connects retail investors with startups looking to raise funds from their community or from personal finance experts who want to diversify their investments.
Despite owning both a venture capital firm and a crowdfunding platform, Founders Future intends to keep the two operations separate. There won’t be any integration or overlap between the two activities. So why did a VC firm like Founders Future decide to acquire a crowdfunding platform?
According to Marc Menasé, the founder and CEO of Founders Future, there are two major trends that influenced this decision. The first is the emergence of a new generation of investors who want a more hands-on approach to investing in both public and private companies. They seek transparency and want to be involved in the real economy. The second trend is the observation that crowdfunding platforms can benefit from the professional and disciplined approach of a venture capital firm.
Founders Future has already witnessed the effectiveness of crowdfunding platforms through its portfolio companies, such as Taster and 900.care, which successfully raised funds on the British investment platform, Crowdcube.
Sowefund’s co-founders, Benjamin Wattinne and Georges Viglietti, will continue to lead the crowdfunding platform, while Founders Future plans to invest millions of dollars to expand Sowefund’s team in the coming years. The objective is to make Sowefund a more professional and reliable platform for co-investment with professionals.
Since its inception in 2014, Sowefund has facilitated 103 crowdfunding campaigns, raising a total of €81 million from over 110,000 retail investors. This certification allows Sowefund to operate in other European countries in the future.
In addition to expanding Sowefund’s operations, the ultimate goal is to enable investors to also invest in funds such as venture capital funds and impact funds. However, this is currently not feasible due to regulatory constraints.
Founders Future’s decision to acquire Sowefund is particularly interesting considering the current slowdown in VC investments worldwide. As many VC firms are becoming more cautious with their investments, startup CEOs are now exploring innovative ways to secure funding.
Equity crowdfunding offers a compelling alternative or complement to traditional financing methods, leveraging the enormous potential investment pool among individuals who have a positive sentiment towards companies they know and use. This acquisition positions Founders Future to tap into this opportunity and support companies in a challenging financing landscape.
