This article originally appeared in Technical.ly Baltimore.
Baltimore startup Arbit is looking to expand its team after an equity crowdfunding campaign this fall.
The social polling startup attracted more than $825,000 through a platform run by Indiegogo and Microventures that launched this year, CEO Alex Bullington said Tuesday. He added that it was the largest round so far for the First Democracy VC portal.
However, the company won’t keep it all. While the total committed was above $825,000, Bullington said the company decided to cap the round at $700,000. That’s why the total currently appears at $700,000 on the portal.
Through the campaign, the company now has more than 1,300 new investors. They committed an average of $750, Bullington said.
“We had a few people that put up $5,000-10,000 here and there,” but mostly it was the “sheer quantity” of the number of investors that led to the size of the round, he said.
The raise marks the first use of equity crowdfunding for a Baltimore company that we’ve covered. The practice was opened up in Title III of the JOBS Act as a new way to help young companies raise capital, and investors who aren’t millionaires get involved.
Arbit opened the round in September after receiving seed funding from TEDCO and completing ETC’s Accelerate Baltimore program.
Bullington and cofounder Greg DiNardo launched the startup as a social polling app where users can compare photos side-by-side. They received early backing from professional basketball players who were eager to use the platform to put questions to fans including Steve Blake, Anthony Tolliver, Caron Butler and Ty Lawson.
They continue to pursue growth on that side, and have also been working on a B2B model that provides a platform where brands can using the technology to create polls around products and conduct market research.
The “platform as a service” approach drew attention when Bullington pitched the business in Japan earlier this fall at the Tribe Tokyo International Business Summit. Arbit won the competition, and earned Bullington and DiNardo a meeting with three investors at the event.
From there, Bullington said interest in the equity crowdfunding campaign took off. They upped the cap from its initial level of $425,000, and ended up netting about $600,000 over the last month. On Oct. 25, they raised $200,000 in a day. In the end, they “oversubscribed twice,” Bullington said.
The total that went above $700,000 came from another 200 investors. That money will be returned, as the founders elected to preserve equity.
The funds come as the startup prepares to officially launch the B2B model in January. Hiring is expected, and Bullington said Baltimore was key to the company’s plans. A new team member on the sales and marketing is already set to relocate from Northern Virginia and join the team at ETC’s Eastern Campus.
Bullington said hiring a Baltimore-based CTO is a “number 1 priority” for 2018.
“Then we’ll be able to have a dev team here in Baltimore and be able to hire 3-5 people,” he said.
Along with funding, the company now has 1,400 new investors to update. Bullington said he plans to send regular updates. He is also thinking of holding a conference-style event.
“Being able to attract all of them to possibly come to Baltimore for a big Arbit conference or something around here would be huge,” he said.