Fitbug Looks to Crowdfunding to Raise Capital for Corporate Wellness Market Push
Fitbug plans to raise GBP 2.6 million during this raise. GBP 852,000 has already been raised through institutional investors, with up to GBP 1.76 million to be raised via SyndicateRoom and other investors at the same issue price. The funding round is expected to close by 25 July 2016.
In August 2015, Anna Gudmundson was appointed Chief Executive of Fitbug. She is currently executing a turnaround drive for the business, moving the company's focus away from delivering wearable devices to an over-saturated B2C market, and instead, capitalising on the growing global corporate audience for digital wellness. The US corporate wellness market is forecast to grow 8.4% annually over the next 5 years to $12.1 billion, which demonstrates the potential in other markets. Digital wellness initiatives have proven to lead to reduced corporate costs associated with absenteeism, and to increased employee productivity.
Fitbug has experienced an encouraging start to trading in 2016 with Q1 B2B sales in excess of ?400,000, a significant increase over like for like sales in Q1 of 2015, providing validation for the new strategy. Furthermore, Fitbug anticipates a strong pipeline for the corporate market, forecasting in excess of GBP 1.1m over expected contract lifetimes. Fitbug has identified a low cost entry point to market and at the end of April 2016, the company had approximately 100,000 users of its digital products.
SyndicateRoom will provide Fitbug with previously untapped retail demand, in support of the company's capital needs. As the only crowdfunding platform to have intermediary status with the London Stock Exchange, SyndicateRoom is the only alternative investment platform offering retail investors access to both the public and private equity markets. Most recently, SyndicateRoom members participated in 3i Infrastructure PLC's ?385m share placing, proving the platform is well placed to promote a diverse range of equity funding rounds, from early stage through to public companies.
Anna Gudmundson, Chief Executive of Fitbug Holdings Plc, said, "Having assessed a range of finance options to support our short-term and long-term working capital needs, we were particularly excited by the prospect of offering new shares to investors via SyndicateRoom. With its recent membership of the London Stock Exchange, SyndicateRoom is the only platform that could effectively distribute our shares direct to crowdfund investors, enabling us to expand the number of owner-advocates for our business as we focus on becoming a leader within this space by delivering an innovative app-based technology to enhance employee wellness."
SyndicateRoom CEO and co-Founder Goncalo de Vasconcelos said, "We're thrilled to provide our members the opportunity to take equity in another innovative and high growth business. In times of uncertainty and market volatility, companies will be looking outside of the traditional lending sector. Today's announcement highlights the importance of retail investors as an ever growing number of publicly listed companies are using SyndicateRoom to tap into retail investors demand. SyndicateRoom still remains the only crowdfunding platform that provides retail investors with direct access to company equity at the same economic terms as institutional investors."
Tom Hinton, head of capital markets, SyndicateRoom commented, "Fitbug's decision to raise via SyndicateRoom demonstrates our unique ability to offer interesting capital market opportunities that can't be found elsewhere by retail investors. It's fantastic to see the platform helping companies access a broad pool of demand and market capital raises in such an innovative way."
SyndicateRoom provides its members with access to the entire funding journey of growth businesses, from early-stage crowdfunding rounds through to high-growth IPOs and discounted placings.
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