Startupxplore wants to bring more transparency to the European startup funding ecosystem

It all started with a map of the Spanish startup ecosystem. My co-founder Nacho and I we wanted to bring more transparency to the Spanish ecosystem and we thought that highlighting all of the startups, investors, accelerators and co-working spaces in the country was a great idea and something useful for those involved in the market.

However, we quickly realized that we could do much more than that by focusing not only in Spain, but in the whole European startup market that has been growing at impressive rates over the past few years, producing billion dollar companies and driving innovation at a pace only surpassed by Silicon Valley and New York.

That’s how Startupxplore was born. Our goal is to become the biggest startup funding community in Europe by bringing more transparency to the market and by connecting key players in each ecosystem: startups, investors and accelerators.

We know other communities out there are doing similar things, but we believe our approach is unique by focusing first and foremost on matching startups with the right investors, and viceversa. How do we do this? By encouraging our startup database, more than 3,000 startups, and 370 investors in our community to be as specific as possible about their objectives, status of their businesses and investment criteria.

Startupxplore’s doors are open to any institution involved with the European startup ecosystem and we want to welcome them with open arms and certain value added features that we hope are useful in the development of the market.

Syndicate funding: lead investors, backers and startups

Every startup needs a business model in order to grow up and become a fully fledged company. When building Startupxplore we thought long and hard about how we could connect startups and investors in a more efficient and simple way, and we found in syndicate investing (or funding) the best way to achieve that.

The syndicate funding model was first introduced by US-based AngelList a few years ago, and it consists in the following: leaders allow other investors (backers) to invest with them in certain startups through an investment vehicle called syndicate. This way of fundraising represents big advantages to all parties involved:

For startups:

  • Access to higher sums of capital.
  • No need to deal with numerous and different investors.
  • Leaders manage their relationship with backers.
  • Cap table simplified: there’s only one investor in the startup’s cap table.

For leaders:

  • Invest more money per deal.
  • Reach startups that might have high minimum capital commitments.
  • Access to better investor rights by investing more capital per deal.
  • They get paid a carry (capital gains generated by an exit or dividends paid) in return for their ‘leadership’.

For backers:

  • Better dealflow and access to better investment opportunities.
  • Transparent negotiation process.
  • Less paperwork than if they were investing on their own.
  • Less risk: leaders have vast experience in investing and thus can differentiate good from bad deals.

All of the parties aforementioned get together on platforms such as Startupxplore -which collects a small commission on each deal-, making startup investing easier and facilitating life for all the parties involved.

Syndicate funding via Startupxplore is currently available in Spain and in coming months we will expand to the rest of Europe. We believe that transparency can improve the current startup landscape in the old continent and we’re here to provide it.

Jaime Novoa

Jaime is the Editor in Chief at Startupexplore.