Project description
Start-ups can start and investors can invest with more certainty of a company’s financial future
Computers and machine learning open up exciting new realms for data analysis and modelling in many fields. Evaluating the financial needs and likelihood of success of start-ups is of interest to both the companies and their potential investors. The Spanish SME Fellow Funders began as a collective crowd investment platform. With the support of the EU-funded FAIR VALUE project, it is now preparing to launch its financial technology tool of the same name, which will help entrepreneurs and investors conduct an accurate and unbiased business valuation, including risk determination and estimation of readiness to attract financing. The tool should minimise start-up closures shortly after opening due to cash flow problems.
Objective
WHO WE ARE? Fellow Funders is a company born with the mission of democratizing the alternative investment. was born as an Equity Crowdfunding platform and now we are seeking to scale up our business by the market launch of FAIR VALUE.
WHAT IS FAIR VALUE? FAIR VALUE is a 100% online Fintech tool to help entrepreneurs and investors in the impartial and accurate business valuation, as well as in determining risks and estimate the readiness of their new business project to access financing. FAIR uses proprietary algorithms for risk analysis and business valuation, supported by machine learning techniques for the automatic adjustment to different sectors, market conditions and risk evolution. FAIR VALUE will help entrepreneurs to get the funds they need to run their business, and investors to minimize risks in their investments.
WHY FAIR VALUE? It is estimated that 8 out of 10 entrepreneurs who start businesses fail within the first 18 months and the difficulties to access funding is among the most common causes. Indeed, it is calculated that 82% of startups that fail do so because of cash flow problems, while more than 27% were not able to receive the funding they needed. A correct company valuation is critical for succeeding in the process of fund raising, but young companies like startups are difficult to value. Unlike valuing companies with revenues, assets and longer track records there are no agreed upon standards for startups and traditional valuation methods fail.
HOW BIG IS OUR MARKET OPPORTUNITY? Our business opportunity is reinforced by the sustained and strong growth of our sector of operation; the Fintech sector, with investment increased from $930M in 2008 to more than $36.9 billion in 2016. This market scenario qualifies our business opportunity, which we conservatively quantify as a cumulative After-tax ROI of 315% for the 1.5M investment we estimate necessary to enter the market in less than 2 years from now.
Fields of science
Programme(s)
Funding Scheme
SME-1 - SME instrument phase 1Coordinator
28023 MADRID
Spain
The organization defined itself as SME (small and medium-sized enterprise) at the time the Grant Agreement was signed.