Online bookseller Booktopia is looking for new investment sources after an ambitious crowdfunding scheme failed to achieve its minimum target.
The company's offer on Equitise was due to expire in three days and would have needed investments of at least $3 million to go ahead, but had only reached commitments of $892,750.
The decision to stop accepting investment on the equity crowdfunding platform was made by the Booktopia Board with the business deciding to re-engage and continue discussions with growth funds, high net worth (HNW) individuals and family offices.
Founder Tony Nash (pictured) says the process has begun for exploring significant investment from a variety of sources, with discussions underway with sophisticated investors interested in inspecting Booktopia's five-year forecasts.
"We have been humbled with the traction the offer received with over 850 keen investors," he says.
"At this time, however, despite the great support, it's not as much as we would have liked to continue with this route of capital raising.
"We're grateful to our partner Equitise for their unrelenting support and will look to engage in an Equity Crowdfunding campaign again in the future when the timing is more optimal and we've been able to scale thanks to larger investment. We still love the idea of our customers being part owners in Booktopia."
He says the focus is to fast-track and execute Booktopia's planned growth strategies including further innovation and automation, as well as holding more stock to fill the company's warehouse which is currently only at 25 per cent capacity.
In its Offer Information Statement (OIS), Booktopia indicated it would need between $2-5 million for its distribution centre automation plans and $3 million for additional stock.
Equitise co-founder Chris Gilbert agreed with the Booktopia board's decision.
"Equitise supports Booktopia's decision to pursue other capital raising options with the intention that we can do another offer like this in the future together," he says.
"Whilst the Booktopia offer had great traction, ultimately the crowd hasn't invested enough. The offer was also affected by a lack of awareness from some investors that they could invest in unlisted companies like Booktopia.
"However awareness and participation in this type of investing continues to grow which is evident in the number of equity crowdfunding offers we have successfully closed. The equity crowdfunds are similar to the OIS offer Booktopia has run."
Gilbert described the country's largest online book retailer as a "great Australian company", with hopes both companies can work together again soon.
Despite concerns Amazon would affect Booktopia's ability to scale and grow further, Nash claims it has been intriguing that there has been little to no resistance from the investment community about Amazon's impact on Booktopia's future.
"Most people realise that their entry into the Australian market has not necessarily been all that it was hyped up to be particularly in regards to books which only makes up 4.48% of its products," he says.
"I do believe that in time they will be a major player in the Australian market in many segments other than books, however it is going to take longer than people were expecting."Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.
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