Booktopia launches $10m equity crowdfund

Written on the 29 November 2018 by Matt Ogg

Booktopia launches $10m equity crowdfund

Australia's leading online bookseller Booktopia is turning a new page in Australian equity raising with a new crowdfunding scheme to offer 8.1 per cent of the company to investors through the platform Equitise.

The Booktopia Group plans to raise up to $10 million at $1 per share, giving Australians a local investment opportunity in a fast-growing company that is now valued at $113.4 million.

This is the largest ever equity crowdfunded capital raise to take plase through Equitise, with Booktopia the "largest company thus far to use an equity crowdfunding platform to raise capital in this way" in the country.

Booktopia has served more than 5.2 million customers across Australia and New Zealand since its founding in 2014 by Tony Nash, Steven Traurig and Simon Nash.

Equitise founder Chris Gilbert says he couldn't be prouder to have such an industry leader in its field raise capital on the platform.

"Booktopia is by far one of the most robust and successful self-made businesses I've ever had the pleasure of meeting," Gilbert says.

"With such a solid road map for continued growth and new opportunities in new markets and their recently launched book distribution business, this opportunity to invest I'm sure will capture the attention of many savvy investors," he said.

"Working with businesses like Booktopia is why we started Equitise some four years ago. These businesses can use capital to grow when listing on the ASX, for whatever reason, is not an option."

If a company is to list on the ASX there is a 20% free float requirement, and if it chooses to take the asset test rather than the profit test route, there needs to have a market capitalisation of at least $15 million or $4 million in net tangible assets.

According to an ASX spokesperson, of the 1,769 companies listed on the ASX there are 421 (24 per cent) that have a market capitalisation of $10 million or less. 

"Equitise gives Booktopia and other businesses, from start-up to later stage, the opportunity to raise capital from an alternative source - a source that gives their customers, friends, family and sophisticated investors the opportunity to come along for the ride," says Gilbert.

One of Australia's most successful companies, the Booktopia Group sells one item approximately every 6.1 seconds and shipped more 4.7 million items in FY18.

PwC's Australian Entertainment & Media Outlook 2018-2022 shows that consumer and educational book total sales (from 2013 to 2017) increased from $1.806 billion to $1.933 billion, resulting in $127 million in extra sales over the five-year period. 

The Outlook forecasts that from 2017 to 2022 the total market will grow from from $1.933 to $1.975 billion.

A large proportion of the growth in the market has come from Booktopia Group's growth in revenue.

"Booktopia's number of website visits has increased approximately 33 percent per annum, from approximately five million in FY2011 to approximately 21 million in FY2018. Booktopia started on a budget of $10 per day and it took three days to sell the first book." said Booktopia CEO Tony Nash.

"We have always said that our customers have been our investors because they bought books from us and we used those funds to re-invest in the business to grow further. It is exciting we can offer our customers the opportunity to actually own a piece of our future."

Related story: Crowdfunding reforms bolster investment pool for Aussie businesses

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Author: Matt Ogg

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