Business Growth Hub supports life sciences

Crowdfunding’s newest posterchild

Cardiff biotech company Celixir has become the latest posterchild for crowdfunding after its 300 investors were given the chance to sell their shares for a 2.7x return on their initial investment.

Innovative biotech firm Celixir, which specialises in developing regenerative medicines, has offered its crowdfunded backers an opportunity to realise a proportion of their initial investment.

Celixir is the seventh Crowdcube-funded business to deliver returns, with a share buy-back that has provided investors with a 2.7x return on the original investment they made in 2014.

This brings the total amount now returned to Crowdcube investors to over £5m, through equity exits and bond interest repayments. Celixir will use the shares it has purchased to fuel growth by attracting and incentivising new talent.

Formerly known as Cell Therapy Limited, Celixir discovered and developed Heartcel™, a medicine that treats heart failure by regenerating cardiac muscle. In 2014 it raised £691,000 on Crowdcube - 176% over its target - from 300 investors in just 10 days.

Ajan Reginald founded Celixir in 2009 to experiment with progenitor cells as a way of repairing damaged heart tissue. His co-founder is Prof Sir Martin Evans, whose pioneering stem cell work earned him and his team the 2007 Nobel Prize for Medicine and Physiology.

The money raised on Crowdcube in 2014 has since enabled the company to develop and manufacture HeartcelTM, and move closer to treating patients across the globe who need it. It aims to treat 100,000 critically ill patients within the next five years.

HeartcelTM is now scheduled to launch commercially as early as 2018, into a global market for pharmaceutical heart failure treatments worth an estimated US$10bn. Celixir also has other developments in the pipeline, including TendoncelTM, a topical medicine that repairs severe tendon damage.

All of the company’s initial investors have now been offered the opportunity to sell their shares with just 18% opting to sell up. The rest have chosen to keep their shares in the business, which hopes to go public in the future.

The Cardiff-based company is now valued in excess of £200m, triple the valuation it was given at the time of its pitch on Crowdcube and the remaining investors will be hoping that this growth trajectory continues.

Reginald said: “Our mission is to develop life-saving medicines. We hope these medicines will be available to everyone in need and so we believed it was important to give everyone the opportunity to invest through Crowdcube in 2014, since which our value has tripled.

“We believe it is only right to share this opportunity with all shareholders, although only 53 of our 300 Crowdcube investors decided to sell shares which is a very positive sign of the confidence they have in our business.”

Speaking about Celixir’s success, Luke Lang, Crowdcube co-founder, added: “It’s truly impressive that Celixir is in a position to buy back shares two and a half years after funding on our platform, and once again provides hard proof that crowdfunded companies can deliver healthy financial returns for their investors.

“The company’s valuation increase is testament to the quality of the ventures that pitch on our platform, and also to the ‘wisdom of the crowd’, which recognised its huge potential back in 2014.

“Crowdfunding continues to mature. Not only has Celixir’s share sale provided investors with liquidity, but the fact that so many of them chose not to exit illustrates the confidence crowdfunders have in the long-term growth of the businesses they back.”

Paul Mears, an investor who decided to stick with his shares in Celixir, said: "The original investment was an emotional one, where I was prepared to invest risk money with the knowledge that it would be spent doing research in an area which was innovative and a potential game changer, resulting in increased life expectancy for many people.

"If successful with Heartcel, the returns could be very significant."

 The other Crowdcube-funded businesses to deliver returns to investors are:

  • E-Car Club, the electric car sharing club for businesses and communities, which was sold to Europcar in the summer of 2015 – becoming the first crowdfunded business in the UK to execute a successful exit.    
  • Camden Town Brewery, which was bought by AB InBev in December 2015, just eight months after raising investment on Crowdcube.
  • Disruptive fashion brand Wool and the Gang, which was acquired by BlueGem Capital Partners in August 2016. 
  • Bond repayments from River Cottage, the Eden Project, Chilango and BrewDog.