Crowdfunding can be defined as “an open call, essentially through the Internet, for the provision of financial resources either in form of donation or in exchange for some form of reward and/or voting rights in order to support initiatives for specific purposes”. Lambert and Schwienbacher (2010)
The sentence above is the first academic definition of crowdfunding ever formulated. As some might have noticed it does not include neither a definition of crowd nor one of initiative.
The sentence above is the first academic definition of crowdfunding ever formulated. As some might have noticed it does not include neither a definition of crowd nor one of initiative.
It is thus a quite flexible definition that could be applied to different cases and situations: a crowd, for instance, could be either a group of people with various backgrounds and jobs or a set of professional investors. In the same way, an initiative could be either a startup in its seed phase or an established SME at a later stage.
Considering crowdfunding under its wider definition, that goes well beyond startups, has always been a fundamental concept for Crowd Valley. As shown by the report on Global Crowdfunding Market, published by the company in October 2013, the greatest part of crowdfunding platforms deals with startups, but a considerable percentage is focusing on other asset typologies too. In particular, it is interesting to observe that some actors in the market are setting up websites to provide crowdfunding for later stage companies,such as established SMEs seeking investors in series C or D rounds. In fact, it has been estimated by a recently launched crowdfunding company in the specific field that, in 2012, there were over $350 billion in private company offerings and 87% of those issuers did not use an advisor or placement agent. For these companies, finding institutional investors willing to provide capital is a very lengthy and time-consuming process, that often distracts executives and directors from the core business. As a consequence, a crowdfunding portal able to connect these later stage companies with a pool of institutional investors may be very helpful for them, by simplifying and accelerating the process . Who else can see in this an interesting opportunity?
References
Lambert, T. and Schwienbacher, A. (2010), An Empirical Anlaysis of Crowdfunding.
Luzar, C. (2013). GrowthCap.co Launches, Helps Established Companies Seek Funding From The Power Crowd. CrowdfundInsider.com
Photo credit to: Robert Scoble. http://bit.ly/1sqMRgK
Considering crowdfunding under its wider definition, that goes well beyond startups, has always been a fundamental concept for Crowd Valley. As shown by the report on Global Crowdfunding Market, published by the company in October 2013, the greatest part of crowdfunding platforms deals with startups, but a considerable percentage is focusing on other asset typologies too. In particular, it is interesting to observe that some actors in the market are setting up websites to provide crowdfunding for later stage companies,such as established SMEs seeking investors in series C or D rounds. In fact, it has been estimated by a recently launched crowdfunding company in the specific field that, in 2012, there were over $350 billion in private company offerings and 87% of those issuers did not use an advisor or placement agent. For these companies, finding institutional investors willing to provide capital is a very lengthy and time-consuming process, that often distracts executives and directors from the core business. As a consequence, a crowdfunding portal able to connect these later stage companies with a pool of institutional investors may be very helpful for them, by simplifying and accelerating the process . Who else can see in this an interesting opportunity?
References
Lambert, T. and Schwienbacher, A. (2010), An Empirical Anlaysis of Crowdfunding.
Luzar, C. (2013). GrowthCap.co Launches, Helps Established Companies Seek Funding From The Power Crowd. CrowdfundInsider.com
Photo credit to: Robert Scoble. http://bit.ly/1sqMRgK
About the author - Irene Tordera
Born and raised in Milan, Italy, Irene is an International Business graduate, with a strong interest for innovative ideas that can simplify our lives.
During her studies, she co-founded an online community for sportspeople and worked in marketing positions at Ogilvy & Mather Advertising and at the European Business Angel Network, in Brussels. She is a passionate blogger about crowdfunding and the startup ecosystem.
Born and raised in Milan, Italy, Irene is an International Business graduate, with a strong interest for innovative ideas that can simplify our lives.
During her studies, she co-founded an online community for sportspeople and worked in marketing positions at Ogilvy & Mather Advertising and at the European Business Angel Network, in Brussels. She is a passionate blogger about crowdfunding and the startup ecosystem.
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