Key: Raising from venture capital and equity crowdfunding in the same round

Key completed its Seed-stage financing round in 2021, boasting a robust cap table featuring prominent venture capitalists, esteemed angel investors, and an enthusiastic community of investors through FrontFundr. Key's ethos of democratizing access to homeownership and real estate naturally extended to democratizing investment opportunities, offering shares in Key on FrontFundr. This initiative brought the opportunity to invest in a Seed-stage private technology company to a wider audience.

“We did raise a good amount through FrontFundr and we’re appreciative of that, but it was about bringing the ability to invest in a Seed-stage private technology company to the masses. We were very pleased with the response. It was great.”

-Rob Richards, CEO, Key

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Key’s raise in a snapshot

• Key raised $550K from 173 investors as part of their $5.6M round.
• The FrontFundr equity crowdfunding campaign accounted for 10% of Key’s eventual Seed round with investment from major VC and angel firms
• 46% of the investors were from the FrontFundr community.
• 67% of the investors were non-accredited investors and of all investors, 44% of the investors fell in the 25-34 age group, those directly impacted by the challenges that Key is solving.
• All of Key’s 173 ECF investors were onboarded using a Voting Trust Agreement (VTA) which allowed the company to reduce these shareholders to a single line on the Cap Table and move voting rights to a single individual.

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A Vision for Growth

At Key, the ambition is to establish a new category in residential real estate, building a massive platform akin to the "Shopify of residential real estate." To achieve this, Key needs venture capitalists who understand the market, provide credibility, and support large-scale financings as they scale toward an eventual IPO. This compelling growth story, combined with their ambitious ethos and capable team, drove significant investment interest from the FrontFundr community.

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Demographics and Community Engagement

Key’s campaign resonated strongly with younger investors, with 44% of investors aged 20-34. Although media coverage for the campaign was limited, Key effectively connected with individuals on their waitlist for home purchases as well as the broader FrontFundr community. The mission to make homeownership affordable struck a chord with many users, reflecting the alignment of Key's goals with the values of its investors.

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The Role of FrontFundr

FrontFundr played a crucial role in making this fundraising round successful. Key appreciated the platform’s professional management of investor relations, corporate governance, communications, and shareholder base. The team recognized FrontFundr as “a really good platform that is professionally put together, that manages investor relations, corporate governance, communications, and your shareholder base. Before the thought of taking on 150 shareholders in a spreadsheet was such a daunting task. VCs shouldn’t worry about it, they should actually like it. To go through crowdfunding now you need to go through extreme diligence and extreme governance, and that set us up for success with the VCs.”

Key’s successful integration of equity crowdfunding into their Seed-stage financing round demonstrates the power of combining traditional venture capital with community-driven investment. The FrontFundr platform enabled Key to engage a diverse group of investors, reinforcing their mission to democratize access to real estate investment and paving the way for future growth.

“I was a venture capitalist for 10 years, having co-founded Plaza Ventures. Investment crowdfunding was not an option 5-10 years ago at Seed Stage, whereas now it is, and it’s a strong complement to VC investment.”

-Rob Richards, CEO, Key