Campaign Success: Nevomo
Nevomo (formerly Hyper Poland) is developing next-generation high-speed railways based on Hyperloop technology. To date, the team has launched two successful equity crowdfunding campaigns on Seedrs, raising over €800k. We spoke with Co-founder and CEO, Przemek Paczek to hear his equity crowdfunding success story.
What attracted you to equity crowdfunding?
The biggest challenge for hardware/ R&D-based startups is reaching a phase when they get recognition in investors’ eyes. Generally, they’re perceived as underdogs, until they demonstrate a prototype. The lion’s share of investments goes to software startups. And it’s quite understandable. Software-based startups will make profits faster than R&D-based ventures. We, in turn, need a few years to put our technology on the market; develop it as a business.
At Nevomo, we believe that equity crowdfunding was the best option for us because of a few reasons. First, we can gradually raise a smaller amount of funds and deliver achievable milestones. This way we can reach the level of a full-scale prototype, combined with commercial development, in smaller steps – every time we raise as much money as we need. In our case, it goes extremely well with public R&D grants, which cover up to 89% of this type of cost. It all helps us to become attractive for a VC in Series A round because we can minimize the risk before they get onboard.
On the other hand, individual investors putting in smaller amounts, can freeze the funds for longer and benefit from bigger returns linked to a very early stage investment. Also, we get a strong investment awareness by backers and shareholders. They become our ambassadors. We did it at the first and second campaigns on Seedrs because it is one of the top global platforms, which has developed a strong Secondary Market. Thanks to it, our supporters can benefit from earlier liquidity before the whole company is ready for an exit.
Aside from capital, how has Nevomo benefited from equity crowdfunding?
It helps us to increase international exposure as well as building a business network across the globe. Our investors come from 35 countries, they work in many fields, from business to technical and they are – besides financial support – willing to help us using their professional experience.
Were there any resources or external support services you used for either of your Seedrs campaigns?
Yes, for our first campaign, we used IdeaSquares. For our second campaign, we did most of it ourselves based on our experience taken from the first campaign, along with taking advantage of B2B relations – participation at international events for example – to boost our goal. Of course, media relations and social media marketing are crucial. Before launching a campaign, you have to have a good marketing/communication plan. Here it is crucial to use the help of experienced professionals.
What do you think has been the key to your Seedrs success?
A turning point was our success during the first campaign when we reached our financial goal in 7 days. Our early investors gave us a huge credit. Reliability has put our company on the next level of business development, no doubt. Without it, we wouldn’t be where we are now. Besides, we fulfilled our promises from the first campaign. We have built and tested our magrail demonstrator. This allowed us to start the second campaign with new goals.