A new Financial Wellness provider improving employees health through reduced financial stress.
- Live with 9 Companies, with 82,500 staff, incl a MNC PLC.
- Contracts with Benefit Partners, giving access to 2.2m employees.
- Growing 35% mth on mth and app opened daily by all users.
- Investment non-conditional on Future Fund funding - see Key Info
Learn more about convertible loan campaigns.
Many of the UK's workforce struggle from one payday to the next. 41% of workers hold less than £1,000 in savings.
Worries about money are some of the biggest causes of stress to UK employees and result in poor financial wellbeing. This can also affect physical and social wellbeing and result in poor job performance, absenteeism, and lower productivity at work. Providing short and longer-term solutions to help address financial wellbeing can improve employees happiness and performance at work.
It is also great for employers as it can increase workplace productivity and decrease staff turnover. Financial stress has been estimated to cost the UK economy £121 billion and 18 million working hours in time off each year.
Float allows employees to take a portion of their wages as they earn them. A range of other services then help employees with long-term financial wellness.
We do this through an employee benefit mobile app, that costs nothing to the businesses who implement it, is simple and instantaneous to set up, and does not interfere with payroll.
The other financial wellness services live within the app help to create behavioural change and turn borrowers into savers. We aim to be the market leader in holistic financial wellness.
Substantial accomplishments to date
· Live with 6 companies, with over 80,000 staff.
· Contract with a Multi National Company - Suez PLC.
· Advanced £100k in first 3 months of trading.
· Growing 35% on average month on month
· Current Pipeline of 255,000 employees.
· We are ready to go live with our B2C banking app – Rise.
· Salary Advance Facility in place to cover strong growth.
Float generates revenue by harnessing the power of employment and open banking data to drive better purchasing power for users.
The employer is the entry point for data on an individual’s earnings and regulatory compliance.
Open banking provides the data on an individual’s spending, lifestyle, and behaviour.
By combining the two, Float is able to provide tailored recommendations for best in class financial wellness solutions. We believe that these partnerships will allow us to build out multiple revenue streams from:
· Salary Advance Revenue
· Credit Union Commission
· Financial Advice Revenue
· Bank Revenue
· Loan Brokering Revenue
Use of proceeds
We expect that the funding raised will allow the company to cover its costs for 18 months without requiring cash from revenue.
Please note the business will be merging with Mywagez Ltd (11433009). The process is close to completion and is a share for share exchange agreement. Money Concierge Ltd will acquire the entire issued share capital of Mywagez Ltd.
Seedrs is supporting companies who are intending to apply to the Government backed Future Fund. You can read more about the Future Fund here: https://www.seedrs.com/learn/blog/the-future-fu....
In order for a company to be eligible to seek matched funding from the Future Fund, this investment round must be on the convertible loan terms that have been prescribed by the Future Fund for this purpose. These terms differ to our normal ‘advanced subscription agreements’.
Given this product differs from most campaigns on Seedrs, we urge all investors, including regular Seedrs investors, to read the information below and ensure you understand the terms in full before making your investment.
You will see a term sheet attached to this Campaign in the Documents section which sets out the key terms of the convertible loan and you can see the full document prescribed by the Future Fund here: https://www.british-business-bank.co.uk/ourpart....
A summary of the key terms is set out below, but should be read in conjunction with the term sheet:
• Discount: 20%
• Interest: 8% per annum, non-compounding. On conversion events, the company can choose to repay the interest or convert it to equity (generally without the discount). See the Term Sheet for more details.
• Redemption Premium: An amount equal to 100% of the principal loan amount
• Qualifying Equity Financing. The convertible loan will automatically convert on an equity financing raising at least the total loan amount, at the lowest share price of equity financing less the Discount.
• Valuation cap of £10,000,000
• Maturity Date: 36 months from signing convertible loan agreement.
o The default position is on the maturity date is that the loan will convert to equity unless the investor majority elect to redeem.
- If redeemed, the company will repay the principal together with the Redemption Premium.
- If converted, the conversion price will be at the most recent funding round share price less the Discount, provided that funding round happened after 20 April 2020 and was at least a quarter of the size of the convertible loan investment. If no such funding round has occurred, conversion will be at the share price of the last funding round prior to 20 April 2020 (no Discount).
• Other events of default or conversion: There are various other scenarios in which the convertible loan may convert or be repaid and investors should reference the term sheet:
o Non Qualifying Funding Round: The convertible loan can convert on an equity financing round which does not meet the size criteria of a ‘Qualifying Equity Financing”, at the election of the majority of investors under the loan. Please see the term sheet for how this conversion is priced.
o Exit: The convertible loan will automatically convert or be redeemed on an Exit, whichever would give investors the higher cash return. Please see the term sheet for how conversion is priced and payments on redemption in this scenario.
o Events of Default: The convertible loan is to be repaid on the events of default, such as liquidation or winding up. See the term sheet for more details.
Government matched funding
The company intends to apply to the Future Fund for matched funding on the total eligible amount invested in this funding round. The Future Fund will “match” the funding raised via Seedrs or other eligible sources, subject to a minimum investment of £125,000 and a maximum investment of £5m. The Future Fund is to be allocated on a ‘first come, first served basis’, so there is no guarantee that a company will receive the Future Fund matched funding.
This campaign is not conditional upon receiving matched funding from the Future Fund. Seedrs will complete the investment and transfer the funds raised even if the application for Future Fund investment is rejected. We will ensure an application is made to the Future Fund for matched funding and will not complete until we know the outcome of the application. But if the application is rejected, the company will still be permitted to complete the investment round.
Seedrs does not charge any fees in relation to the Future Fund matched funding, application process or for acting as lead investor with respect to applications.
Conversion to equity
The convertible loan agreement prescribed by the Future Fund is equity focused and favours conversion of the loan to equity as the default position.
Redemption is only available in certain scenarios and is often subject to the vote of majority of the investors. Where a vote of investors is required, Seedrs will vote on behalf of any investors it represents as nominee.
There is a possibility that the convertible loan will convert in some scenarios without the consent of Seedrs (if we do not make up a majority of investors). It is also Seedrs’ position that this is primarily an instrument for investing in the equity of the fundraising business and our default position would be to vote in favour of converting the loans to shares in the company, unless there is a clear or compelling reason not to.
As always, investors should be aware of and accept the risks involved in investing in early stage and growth focused businesses: https://www.seedrs.com/pages/risk-warnings
In addition to the usual risk warnings included above, investors should be aware of and accept the following with respect to convertible loans:
• The convertible loan agreement is intended as bridge funding to a future funding round, but there is no guarantee that a company will be able to secure further funding.
• The Future Fund is to be allocated on a ‘first come, first served basis’ and there is no guarantee that a company will be successful in its application to receive the Future Fund matched funding.
• There is a risk that the Company may not have sufficient funds to repay the loan on the maturity date, pay interest when it becomes due or pay the redemption premium included in the terms.
• Convertible loans are unsecured obligations and in the event of a winding up or liquidation event will rank behind secured creditors of the Company.
Investors will not be able to sell their interest in the convertible loans on the Seedrs Secondary Market unless and until they have converted to shares in the company (and then only subject to eligibility and the terms and conditions of the Seedrs Secondary Market).
EIS Relief - past, current and future
As noted above, the convertible loan instrument is not compatible with EIS requirements, so no EIS applications will be made with respect to investments in the convertible loan.
The government has confirmed that investing in the convertible loan will not impact EIS relief previously claimed on investments in the fundraising company:
“The government has confirmed that such previous investments will not be affected where the convertible loan converts into shares. Where the convertible loan note redeems, we have been alerted that the government intends to make changes to the rules to clarify that this is compatible with such previous investments.”
However, investing in a convertible loan could impact your ability to claim EIS relief on future investments into the same company. The government has not clarified the position on this and has said it is a matter for HM Treasury and HMRC.
Seedrs is unable to provide tax advice. Tax treatment depends on individual circumstances and is subject to change.
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