One of Spreds' greatest strengths is its selection criteria. Discover below the three layers of our selection process and why they make our platform so unique.
1. The Algorithm
To be able to raise funds on our platform, each company has to fill out an application on our website to see whether or not they are potentially eligible for a campaign. in order to select the most prepared and promising companies, we have developed a specific algorithm that is then applied to their application (background check, cash flow analysis, etc.).
2. The Collective Intelligence
A campaign on our platform is also a way of testing a product/service and the ability of each entrepreneur to sell this product/service. It is a great way to test if the entrepreneur has the right attitude and energy to sell and communicate his or her story.
Our community is also very diverse and is made of people of various sectors and all types of professional backgrounds which means that they also have the unique ability to analyse the different aspects of each company that is presented to them.
It’s an opportunity for entrepreneurs to sell their project to people who haven’t even heard of it before and convert them. The success of each campaign depends on whether or not our community of investors believe in the product or service that is presented to them. In other words, if enough of these investors do believe in the project and invest, then the campaign is a success, if not the campaign is cancelled.
3. The Co-investor
We believe that the sources of financing of a company should be well balanced, this is why we opted for a co-investment model. All campaigns on Spreds are financed by both a community of investors and what we call “professional investors” who bring one or more large tickets.
The community of investors benefit from the same conditions as the professional investor (business angels, venture capital funds, …) , ensuring fairness. Entrepreneurs can benefit from a new expertise and potentially gain a board member.
If the campaign has raised its minimum financing amount on our platform, each entrepreneur has 6 months to find his or her co-investor(s) that will have to invest a minimum of 25% of the maximum financing amount (if the campaign is part of one of our Tracers, the minimum co-investment amount will be €50,000). If they fail to find the necessary amount among their co-investors, the campaign is cancelled.
In 2018, among the thousands of applications received, 4% passed our selection process. This triple level selection process thus allows us to offer our investors the most promising companies by combining our specific algorithm to the knowledge of our community and the experience of professional investors.