Crowdfunding platform CircleUp, which connects accredited investors with food-focused retail businesses, announced it has raised $30 million in a Series C round led by Collaborative Fund.
The San Francisco, CA-based startup facilitates the interaction of businesses with compatible investors through its products that include providing market data and product sampling, among others. With its latest round of funding, it plans on developing new products and services for investors and entrepreneurs, CircleUp Cofounders Rory Eakin and Ryan Caldbeck said.
“In the past year, we have built machine learning algorithms to evaluate companies,” Caldbeck told TechCrunch. Referring to the company’s progress on crunching data derived from 150 data sources for building up its database, Caldbeck said, “This is a key innovation, and no other company in this space is doing it.”
Now, with more funding backing the company’s growth, CircleUp is better positioning itself to compete with other crowdfunding platforms, such as SeedInvest, AngelList and FundersClub.
While the startup might lack in years of experience in the crowdfunding market, its area of expertise sets it apart. Unlike CircleUp, which exclusively gives exposure to consumer goods-focused businesses, its competitors are mostly focused in the tech sector. Moreover, as TechCrunch pointed out, CircleUp distinguishes itself from other platforms like Kickstarter by thoroughly vetting the companies it chooses to serve.
Since the company was founded in 2011, the company has reportedly helped only 120 businesses raise money, which by simple calculation would make many question its success. However, it’s a quality-over-quantity style model that CircleUp works upon. The average investment raised by companies through CircleUp’s platform averages over $1 million, with $135 million in total raised so far. CircleUp, according to TechCrunch, charges a 5 percent commission on the funds.
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