Project PowerUp sets sights on Silicon Valley
Thursday, November 24, 2011/
The founder of Sydney-based crowdfunding site Project PowerUp says he plans to visit Silicon Valley early next year to drum up interest from investors, with the possibility of relocating there.
Project PowerUp, founded by Ryan Wardell earlier this year, is an online crowdfunding site aimed at helping start-ups raise up to $25,000 for their projects.
The site takes 10% of all funds raised for successful projects, plus transaction fees of 2-5% based on transaction value and volume charged by credit card and payment processing companies.
Now Wardell has announced his plan to venture to Silicon Valley to take his business to the next level, claiming the Australian crowdfunding scene is a little below par.
“I’m planning on going on an exploratory tour in January or early February. The Australian market is still small, so I need to start expanding,” Wardell says.
“The whole crowdfunding space is moving a lot quicker than I’d anticipated and I’m worried that I’ll get left behind if I stay in Sydney.”
“In America at the moment, they’ve introduced a crowdfunding bill that would allow people to use crowdfunding sites to sell equity as well as products and services.”
“That’s like the Holy Grail of crowdfunding – that’s where the real money is going to be made.”
“The writing is on the wall… For me personally, I need to be [in the United States] when that happens so I have my finger on the pulse.”
Wardell says he’s planning to travel to Silicon Valley for three to four weeks but will set up meetings beforehand. He also plans to take advantage of Australian contacts.
“There’s the Aussie mafia over there and a bunch of people I met through [start-up communities] Fishburners and Silicon Beach, who are in and out [of the US] fairly regularly,” he says.
“I’ll be meeting with people not just once but two, three and four times to build up relationships there and hopefully get a few people interested in investing.”
Despite his ambitions, Wardell also has reservations about heading to Silicon Valley, namely the fact that we won’t have a job when he arrives.
“I’m very conscious of the fact that I’ve got to start making money or get investment, or the whole thing will fall over,” he says.
“I don’t know anybody and I don’t know where to go. I’m reasonably well connected to the start-up community in Sydney… Over there, I don’t have that same support network.”
“I’ve also had a chat to [99dresses founder] Nikki Durkin [who was recently selected to participate in the US-based Y Combinator program].”
“She said all the developers over there are super expensive because they’re either working on their own start-ups or Facebook has hired everybody, so they’re charging the earth because they can.”
But according to Wardell, the positives outweigh the negatives.
“The valuations over there are much higher but most investors don’t want you to be located in a foreign country – they want to be able to drive to your offices,” he says.