A recent public consultation launched by UK’s government determined that P2P lending will have increasingly a central role in SMEs finance. In fact, starting later this year, British SMEs will have the chance to be linked up by banks to alternative finance providers - such as P2P lending portals -, when rejected by traditional credit providers.
In July 2013, Italy’s financial conduct authority (CONSOB) released one of the first national regulations for equity crowdfunding in the world. More than one year has passed since and despite the regulation being in place, the market is overpopulated with “empty” platforms, lacking a sufficient vibrance, in terms of deal flow and number of investors. In the last couple of years , while waiting for Title III to be eventually released by the SEC, several US states adopted intrastate crowdfunding laws, which allow companies to raise capital through local securities crowdfunding portals. Among them there is Michigan, whose securities crowdfunding exemption allows resident issuers to offer securities only to local investors, like it also happens in other states. As Malaysia’s framework for online investment marketplaces (equity crowd funding) is unveiled, there’s a lot of buzz around the region about the impact of new online funding models. While countries like Malaysia are looking to other countries for benchmarks, initial frameworks are still largely mirroring one another and real world applications will show how they can be applied to new regions. Despite the fact that there are heaps of articles being published, suggesting that a crowd investing sector or geography is dominating the rests. While appealing as a thought, the market is still nascent and any domination, may simply suggest that growth is uneven cross the various dimensions. However, there are observations that can be made in how the market is evolving, at various stages across the world. The rise of a more cooperative societal nature among the citizens of the United Kingdom over the past decades has established the UK as a 'collaborative economy.' Collaborative economies are roughly defined as economic activities and models where people have access over ownership. Decentralised networks are promoted over centralised institutions, and wealth is unlocked. More and more people are sharing, everything from bicycles to private airplanes, and their own bedrooms. This collaborative nature has stirred up the pot of traditional market practices; we are now looking at a new way of doing business. And consequently, just as we share our space, we are looking to each other for finances, through crowdfunding. An innovation is said disruptive when it “helps create a new market and value network, and eventually disrupts an existing market and value network (over a few years or decades), displacing an earlier technology”. Crowdinvesting has been evolving in a way that could well be that of a potential disrupting innovation for many markets. And real estate may be the first one. California and New York have dominated the entrepreneurial and crowdfunding race in the States, but almost out of nowhere, the southern state of Kentucky, who was ranked second to last in the entrepreneur ranking in 2008, is now in fourth place according to the State Entrpreneurship Index (SEI). An outstanding and promising achievement for the small state. Recent reports from the state indicate that more Kentuckians have started their own business, and the number only appears to be growing. |
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