LaunchRock, as the name implies, was initially focused on helping startups create launch pages to acquire users, though it eventually expanded its product to cover other aspects of finding and building a relationship with users. Both Will Schroter (founder and CEO of Fundable) and Jameson Detweiler (founder of LaunchRock) said LaunchRock will continue to exist as a separate product, but they see big opportunities for integration as well.
“The focus of LaunchRock has always been to capture startups at the idea phase and build a tremendous following for them,” Schroter said, while Detweiler noted that crowdfunding comes in later: “You have to have more of a real business.” In other words, someone with a cool idea could “prove demand” (Detweiler’s words) with LaunchRock, then if they need more funding to build a company, they can turn to Fundable.
The companies aren’t disclosing the acquisition price. They did say it was a combination of cash and stock, with LaunchRock’s 42 (!) investors becoming investors in Fundable. That includes 500 Startups, Trinity Ventures, Venture51, and Quotidian Ventures. (Fundable, on the other hand, was funded by its founders.) Together, the two companies will have a headcount of 25.
Schroter noted that the combined entity will have 10 million users, including 500,000 startups, and that it sees 15,000 new companies signing up every month. That makes for “one of the largest, if not the largest, footprints in business crowdfunding.”
Businesses on Fundable have received a total of $87 million in crowdfunding commitments, and the average raise amount is $175,000 — that’s significantly higher than most projects on Kickstarter, and it’s a sign, Schroter said, that equity crowdfunding plays different role compared to reward-based crowdfunding sites.