Michelle HammondFollow on twitter www.startupsmart.com.au
Sydney start-up Project PowerUp sold to Alchemy Equities
The founder of crowdfunding platform Project PowerUp has set its sights on the United States after selling the business for less than $1 million, barely a year after it was launched.
Ryan Wardell launched the Project PowerUp platform midway through last year. It allows entrepreneurs to pre-sell their product or service, and then use the proceeds as seed capital to start their business.
Wardell, who is based in Sydney, is also the brains behind Cofounder Speed Date. It’s now been revealed he has sold Project PowerUp to Alchemy Equities for a sum less than $1 million.
Alchemy Equities, also based in Sydney, provides business advisory services to companies seeking to raise capital. It could not be reached for comment.
However, Wardell told StartupSmart he was approached by Alchemy Equities, not the other way around.
“Project PowerUp was getting to be kind of tough. I needed to bring on technical people and raise some capital, and I just wasn’t enjoying it as much,” he says.
“[Alchemy Equities] approached me. I had a couple of people interested but they were the keenest.”
As Wardell didn’t employ staff, the sale process was relatively smooth. But as it was the first company he has sold, he did learn several lessons.
“The thing that was kind of interesting was the way [the deal] was structured was I got part of the payment upfront and then part of it at a later date,” he says.
“They wanted to keep me around and show them how to do things, so they had access to me in that kind of transition period. I found that kind of interesting.”
“When [Australian entrepreneur] Nikki Durkin came back from the US, she told me that when you’re raising capital, you do it off the back of hype or reality.”
“Selling a company is the same thing. For me, I was probably lucky in that there was a lot of crowdfunding hype at the time, so I was able to sell it off the back of that.”
Wardell says he likes the fact that Alchemy Equities has every intention of maintaining the Project PowerUp platform.
“I think they were the right fit in the sense of they actually wanted to buy it for the product itself,” he says.
“They can also do larger capital raising. In that sense, it’s probably better for Project PowerUp.”
In addition to Cofounder Speed Date, Wardell is working with Collusion, which he describes as “an iPad app plus a digital pen”, based in the cloud.
He’s hoping to relocate to the US later this year, with plans to do something in the gaming space.