Looking Back on FrontFundr Historical Returns

Luca Manglaviti
January 11, 2024
4 min
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The year-end period is often used by companies and investors alike to review their performance over the last year. This reflection often sparks discussions, which lead to new strategies to achieve desired goals.

However, venture capital investing can be quite different. Investments are typically locked in, with no secondary market available to liquidate positions, and early on in their life cycle.

Remember, venture capital investments typically have an investment horizon of five years or longer.

With that in mind, a review of previous investments can always lead us to improve our processes for future investment decisions.

FrontFundr has been operating for over seven years now, with the majority of our raises taking place in the last five years. We’ve raised capital for over 180 companies, across a user base of over 40,000 investors, raising over $200M.

That being said, we’re still on our path of democratizing the private market for all Canadians, with some exciting new projects ahead in 2024. Now let’s hop into our year-end raise statistics review!

Raise Statistics

  • Strong Due Diligence: 91% of issuing companies on FrontFundr are still operating or have undergone liquidity events.
  • Equity Crowdfunding focus: With 77% of raises using equity instruments, not only are companies receiving the capital they need to grow, but FrontFundr is enabling investors to become part-owners in the start-ups they believe in.

Impressive Returns

Note: past performance is not an indicator or guarantee of future performance.

  • Overall Results: FrontFundr’s returns have not only matched but exceeded traditional Venture Capital estimated returns of between 25-35%.
  • Early-Stage Investing: Investing on FrontFundr allows investors to join a company’s growth journey early on, enabling them to invest at a lower valuation than future rounds.
  • Myth (potentially) busted: Investors are often tempted to liquidate their investments as soon as a liquidity event takes place, which is definitely a fair idea. These statistics show the value of sometimes holding onto those investments! One can never know an all-time high (ATH) price until it occurs, the choice to hold or sell, after a liquidity event takes place, is yours for the making, just be aware that both decisions are valid options.
  • Average returns: Private market investments are high-risk, long term investments. FrontFundr recommends investors invest within their means, only committing a recommended percentage of their financial assets in these holdings, and investors should be prepared to potentially lose their investment amount. All in all, through the wins and losses, FrontFundr still averages a positive return.

Patience Required

  • Unrealized returns: 16% of our operating alumni have experienced an average share price increase of 80%. These investments cannot be liquidated but it seems like our alumni are moving in the right direction!
  • Long-Term Focus: Despite our recent success, private market investing is still a long-term game. Investors should be patient while waiting for updated investment valuations, as well as liquidity events. The longer term horizon for private market investments adds to the risk level of the investments and don’t forget, with a higher risk level comes a higher potential level of return!

As we look forward to 2024, we’d like to thank you, FrontFundr investors, for supporting our mission to democratize the private markets in Canada. Your investments not only reinforce the idea that our company’s purpose is worth pursuing, but they also help fuel the next generation of Canadian start-ups, aiming to better the lives of all Canadians.

In the coming weeks, FrontFundr will be releasing our inaugural Year in Review report, looking back at 2023 and the accomplishments of the businesses that have raised since the launch of FrontFundr to those who closed as recently as December 2023. This report will provide insight into what these companies have done since completing their raise on FrontFundr and paint the picture for the equity crowdfunding industry as a whole in Canada.

In the meantime, don’t be a stranger, feel free to reach out to our team whenever with your feedback; this is truly a team effort!

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Luca Manglaviti