Amsterdam-based e-bike brand VanMoof has opened a new round of funding on June 12, seeking €7.5 million, of which €2.5 million will be crowdfunded (the maximum allowed under Dutch law).
This is the ten-year-old company’s second round of crowdfunding. The first, in 2017, raised the €2. million maximum in seven days. VanMoof used the investment to open four brand stores across Europe, the U.S., and Asia.
The new crowdfunding–which reached €1.3 million within a few hours of launch–will be used to scale up production, said a statement from VanMoof.
€5 million of investment is open to venture capitalists.
In April, VanMoof announced it had sold 11,000 of its electric S2 and X2 city bikes. The company said in a statement that the sales–worth nearly €30 million–were generated through its website and its eight standalone stores.
Taco Carlier, co-founder of VanMoof, said of the crowdfunding element:
What we are offering is a convertible loan. So that means that people provide a loan, and that loan will convert into shares as soon as a new investor steps in. Then people will get a discount on that conversion of 15 to 30%. So let’s assume someone lends us one thousand euros–that can take another year, and then one year later a [venture capitalist] invest in VanMoof at the valuation of x, then the crowd can convert their loans into shares, also at this valuation of x.”
Crowdfunding is the quickest way to raise development capital, stated Carlier:
This is a great tool for fast growing companies to postpone the federation a bit. It is easier to do crowdfunding, because if we do have had to do an evaluation–that’s obviously a lot of work and a lot of costs. So in this way, you leave the valuation to the VCs. But you do give the opportunity to the crowd to go invest to join.”
He added: “Our turnover has quadrupled this year. But this expansion in sales costs a lot of money. It’s a very capital-intensive business, we need to buy all the parts up front before we can ship out the bikes. So we need a lot of cash in order to grow our business.”
Investment will pay off, said Carlier, because e-bike sales–especially in Europe–are booming.
One million e-bikes were sold in Germany in 2018, a year-on-year increase of 36%. And in The Netherlands, e-bike sales have now overtaken non-electric bike sales.
Carlier believes VanMoof will continue to ride this e-bike wave: “We believe the e-bike business is at the beginning of a very fast growth path. There is a big opportunity ahead of us. We need more cash in order to scale up in order to get more sales.”
The latest funding campaign is run through Euro-focused crowdfunding platform Oneplanetcrowd.
