It’s not unheard of for startups get sold off on auction sites, but raising your first funding via one? That’s a little different. Polish startup MyGuidie offered a 1% stake in the company on the country’s eBay-esque site Allegro – and even threw in an iPad 2 for the lucky top-bidding angel investor too.
MyGuidie is a platform designed to connect travellers with local guides in the places they visit. The company takes 15% commission (minimum $4) on fees paid to the guides. It only launched two months ago and is at the very start of its journey. So, why take such an unusual approach to funding?
19 year-old CEO Ola Sitarska explained to me that the company decided to sell 1% of MyGuidie, and an iPad 2 which it won at Warsaw Startup Weekend, because the team needed money for two trips to London to present their product at Europe Startup Weekend Battle and, they hope, Mini Seedcamp. “Our startup and iPad 2 it’s all we had, so it was easy decision,” she explains.
The auction itself gained attention in the Polish media. “We’re very surprised, because we’re only two months old! During the auction, we got more than 100 e-mails or phone calls about MyGuidie and selling. At this time, we’re in the middle of negotiating with two Polish investors, but the money from auction let us to go to London.”
In the end, 1% of the company sold for 19,300 Polish Zloty – the equivalent of $6806, £4179 or €4800. That pegs the fledgling firm at a $680,800 valuation. Sitarska says that the person who won the auction isn’t an experienced investor, but he has experience in promoting startups and is based in the USA. “He fell in love with our idea and wants to help us – not only by money, but also by experience and contacts.” The MyGuidie team don’t know much more than that about their investor, but they plan to meet within the next week.
Offering up stock in a new company via an auction site is perhaps a little risky as you don’t know who you’ll end up with, but it seems like it may have paid off for MyGuidie.