The DryGro team set out to raise a £980,000 round to fund their breakthrough technology that focuses on addressing a massive market need: food in the future. DryGro is developing innovative, low-cost production methods for growing a protein ingredient to replace soybean meal in animal feed. DryGro got first funded through a Sustainable Ventures raise on Seedrs, but came back after a few years for their own crowdfunding round. They hit their target by 117%, raising over £1.1m from 722 investors.
We sat down with Sean Peters, Co-Founder and CEO at DryGro, to discuss his experience raising funds on Seedrs and how crowdfunding can also work for a B2B company.
Tell us about how DryGro started? Where has your vision taken you so far?
It all started at the University of Oxford, whilst I was studying for an MBA, I met my now co-founders, Charlie Curtis and Tim Kruger. Thereafter, I hired our fourth co-founder, Brendan Cawley.
We were all interested in similar things within the climate change space. They had been doing some tests with alternative proteins on campus and I was really excited about the potential of alternative proteins surrounding the future of human consumption. Together, we were really interested in how we could feed the world when we add two extra billion people to it.
We began to build out the company and five years later, we have operations in the UK and Kenya, with a team of almost 30 people.
Tell us about your fundraising journey before Seedrs?
Our first interaction with Seedrs was through one of our first investors, Sustainable Ventures. Sustainable Ventures raised a successful round on Seedrs and have continued to crowdfund on Seedrs every year to invest in early-stage climate change focused startups. We were really fortunate to benefit from one of their earlier rounds which gave us a massive support. Having already been familiar with the Seedrs process, our contact at Seedrs suggested running a full campaign with them to top up our round, it was a natural next step for us!
When you came to Seedrs, why did you decide it was the right time to raise a round?
It was the right time to raise on Seedrs because it supported the next phase of our business expansion plan which included hiring additional staff and investing in research and development. Together with the increased interest in both climate change and the plant based protein space, we knew Seedrs would be a great fit for us.
At the time of your Seedrs round, what other fundraising options did you consider, and why did you choose crowdfunding? What were your goals from crowdfunding?
We raised equity and grants in the past, so we had some experience in that space, but we never ran a crowdfunding round before. It was all really new to us, to promote your campaign to a wider public.
We chose crowdfunding to close the end of our round. We had raised most of the round with a family office, and were eager to fill out the remainder of the round target. As we’re a B2B business, it was less about promoting the business or the marketing benefits of an equity crowdfunding round.
Why did you choose Seedrs? Why did you feel we were the right partner for your business?
We were aggressively marketed to by other crowdfunding platforms, but we already knew Seedrs through Sustainable Ventures. They’ve always been very professional and supportive, which is great, especially for a company running a crowdfunding raise for the first time. The investor community is very active and vocal, and that often helps us refine our thinking as well.
How did you pitch crowdfunding to your lead investors?
Our previous lead was Sustainable Ventures on our first round, so they were already vocal supporters of Seedrs. Seedrs is technically already on our captable so it benefited to increase our relationship with a known entity rather than doing something new.
Talk us through what running a campaign was like?
One of the most surprising things about Seedrs is that the community is so engaged, more than anyone would actually realise. Anytime we run a campaign, our discussion forum explodes, so there needs to be a lot of energy and time put into responding to questions that come up.
How we see it is that these people are giving a portion of their wealth into companies like ours. If we were looking to raise larger ticket sizes, there would be a much longer lead and courtesy process. For many of these investors, they are investing what feels to them like the same amount of cash like say a HNW individual. So of course they want to ask the same kind of questions and have the same level of involvement with the company.
Whilst it can take some time to answer these questions, it gives us a chance to engage with investors and break down a complex matter in a simple way.There is always a challenge for us to communicate with people that don’t come from our industry, to explain why we’re doing this and why it matters, but it’s also really rewarding.
What investor feedback did you receive, and how has it helped you navigate your crowdfunding campaign and growth?
I can’t say anything specific, but I can say many investors track you down on LinkedIn, send you messages and support you by looking for ways to introduce you to other investors. There’s definitely the opportunity for additional value beyond Seedrs raises to tap into this community.
The Seedrs community is self-selecting, they’re there because they’re interested in startups, investing, and the particular industries they’re paying attention to. As an entrepreneur, you get to benefit from people who challenge your thoughts but also come from various industries, bringing in a wealth of experiences.
What were some of the aspects of crowdfunding you weren’t aware of that turned out to be essential for a successful round?
My experience with crowdfunding previous to Seedrs was through platforms like Kiva, a platform providing micro-financed loans for entrepreneurs and venture markets. My experience there was as a investor, way back in the day when I was at university. All you could see was a profile of someone and that’s it, you decide based on that profile.
What’s surprising about Seedrs is how interactive the platform is. You’re not just posting an investment opportunity and then waiting for transactions to come in, but you’re really engaging with a community. I think the people that have been the most successful at raising funds on Seedrs are those who have put a lot of effort and time into engagement.
What were some of the highlights of your campaign?
The enthusiasm of the investor community both financially and investor support wise.
How would you describe your overall experience working with Seedrs?
The Seedrs team is great! One thing I’ve been really impressed with over the course of the past years, is that as we’ve grown as a company, so have Seedrs. We had a few different main points of contact as the company grew, some people have left Seedrs and others have stayed. But what I find really cool is that the people we’ve dealt with in previous rounds still keep in contact with us. I know people who worked at Seedrs and have now moved on to VC funds, in our most recent rounds they’re still in contact and they’re still trying to connect us with their networks.
I think the staff that Seedrs has attracted are interested not just in helping raise crowdfunding investment, but helping support startups and that’s where you really make the difference.
What have the proceeds from crowdfunding/your Seedrs round helped you achieve so far, and what plans do you have in the pipeline for the upcoming months?
We’re actually just launching an investment round right now (September 2021). This will be a much larger round, we’re going for £15m. This feels like a really big step and we’re very excited about it.
2020 was a tough year for everyone but we’re very proud of the team that we managed to build across continents. Our second producing facility is up and running and producing in Kenya right now, we’ve received good research feedback and the plant based protein industry is evolving. These days the larger companies are coming to us because they see how the future is being shaped. There is much more of a pull now than a push from our side.
Aside from the funds, what have been the long term benefits of your crowdfunding campaign?
The Seedrs community has connected us to external investors and have supported us outside of our Seedrs raise. As mentioned before as well, the support from Seedrs staff, and ex-staff, who’ve been connecting and supporting us has been great too.
As we commence on raising our next round, with Angel investors investing the bulk of the round, it’s always credible to be able to say that we had success raising on Seedrs in the past. There’s an extra comfort for future rounds knowing that we’ll be able to close extra cash if we need to.
To find out more about DryGro, visit their business page.