Honeycomb Credit, which claims to be the first of its kind loan crowdfunding platform, has scored $1.75m in its seed round.
The round was supported by American Family Insurance Institute for Corporate and Social Impact. Other backers to the round include Works, K50 Ventures, The Urban Redevelopment Authority of Pittsburgh, Reinforced Ventures and Flight.vc.
With the equity, the company hopes to partner with investment funds and financial instructions across the US.
Based in the US, Honeycomb Credit is a loan crowdfunding platform that enables consumers to provide businesses with loans from as little as $100. Investors receive quarterly repayments.
It claims to have helped small business owners get a total of $3.5m in expansion loans crowdfunded from thousands of people who want to support local businesses. Since it was founded in 2017, it has run over 100 investment crowdfunding campaigns in 18 US states.
Honeycomb CEO George Cook said, “While local businesses were working on the fly to adapt their business models to the pandemic, the modest funding they needed simply wasn’t available through traditional lending sources as banks and online lenders pulled back.
“We give these businesses a way to connect with community members who care deeply about the survival of their local businesses and want to ensure it through their investments.”
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