Friendly face in the crowd

The Life: Beetify, a crowdfunding platform that expects to launch this year, aims to empower start-ups and the youths, say founder Luciana Ledesma.

Luciana Ledesma says the launch of the crowd-funding platform Beetify will assist budding entrepreneurs. Micaela Colace for The National

As a management student in Munich, Luciana Ledesma is working on a future beyond academia.

As she finishes her MBA in innovation and business creation at the Technical Univesity of Munich, the 31 year old from Argentina expects to launch a crowd-funding platform in the UAE called Beetify in the first quarter of this year.

It will "help you knock on doors", says Ms Ledesma, who worked in the government energy sector in the UAE for four years before moving to Germany.

"This will give talented young people in the UAE not only a funding source, but also feedback from potential customers and mentorship," she said during the Arab Innovation Network conference in Abu Dhabi last month.

Crowd funding is growing in popularity for small-to-medium sized businesses, start-ups and even creative ventures, such as short films and documentaries, in the UAE.

Along with Aflamnah and Eureeca.com, the Beetify site not only promises to add another funding tool to Emirati and expatriate entrepreneurs, but also to mentor them, as well as engaging them in pre-sales and brand-building activities.

Beetify expects to launch with two companies, including one that will create a diabetes mobile app in Arabic. In the first year, it expects to support six companies and new ones every two weeks.

"We are looking at 30 inquiries now," Ms Ledesma says.

It is receiving applications through its preliminary website, Beetify.com, as part of its pre-launch.

To ensure investors are not taken for a ride by fraudsters, Beetify will assess the applications to gauge the commitment of entrepreneurs seeking funds and share their information on the website. "For example, we ask the creator to be specific on what it needs the money for and give details when possible," Ms Ledesma says. "This would show that he or she has already done research to conduct the project and the quality of this research will not only help us to select them, but also to convince potential funders."

As a concept that has grown since it was pioneered in 2009 by the American platform Kickstarter, crowd funding has attracted new laws in the United States.

President Barack Obama's administration passed the Jumpstart Our Business Startups Act, under which investors might get equity in the company they fund. In 2011, Kickstarter attracted US$100 million (Dh367m), up from $28 million in 2010.

"With the current regulation [in the UAE], reward-based platforms can operate without the need for new regulations," Ms Ledesma says.

Beetify would charge a commission of 5 to 10 per cent based on the industry and no initial membership fees.

While Aflamnah funds films and documentaries, Eureeca.com has an equity-based model. "We bring, for the first time, opportunities to the public to invest in growing businesses that previously were only open to angel or venture-capital investors," says Christopher Thomas, the chief executive at Eureeca.com. It expects to launch this month with about four projects.

Eureeca.com also encourages fund seekers to offer opportunities for early exit, where investors can sell shares back to the entrepreneur at an agreed rate on an agreed date and also provide benefits, such as lifetime loyalty discount cards, free products and subscription benefits.

It is looking at about 300 applications, 70 per cent of which are from the UAE. The remainder are from Jordan, Lebanon, Egypt, Malaysia and the United Kingdom.

The minimum investment has been fixed at $100 per project.

This is the gap that Beetify hopes to plug: bringing together innovation lovers to invest as little as Dh50 in a project.

"The funders will get something, but not necessarily monetarily," Ms Ledesma says. "The main idea is to empower this generation."