Crowdfunding: democratising production Daniela Castrataro, twintangibles 5/10/13
Crowdfunding: democratising production
Daniela Castrataro, twintangibles
5/10/13
What is Crowdfunding?
“Crowdfunding is a method of raising capital, or resources, by collecting together lots of small
amounts from a large number of people generally using the Internet and social media.”
“Crowdfunding is a method of raising capital, or resources, by collecting together lots of small
amounts from a large number of people generally using the Internet and social media.”
“More to me than actual money”
Key Characteristics and advantagesKey Characteristics and advantages
o Individual EmpowermentoMicrofinance – low barriers, larger tribeoValue of relationshipsoValue of truth and empathy - TrustoValue of Information – new currencyoTransparencyoRewards – Intangible value
oDistributed cognitionoMarket testing / Brand advocateso Increasingly a location for VCs
All or Nothing
Take it All
Accredited investors
Club Model
Micro-lending
P2P/P2B Lending
Donation/Reward Based
Equity Based
Social Lending
CrowdfundingPlatform Models
Royalty Based
What is Crowdfunding?
Cooperative Model
A world of Crowdfunding
800+ CF platforms, over 1.1M successful campaigns(62% donation-based)Total raised in 2012: + 125% ($2.7 billions)Growth in Asia (+10%) and South America (+8%)Highest growth in funding volumes: Lending (+111%)Best success rate: Lending (91%)
World trends- Growth of hybrid platforms (63.5% portals in
pre-launching phase vs 45% current portals)- Growth of niche platforms - Localvesting- DIY Crowdfunding- Enterprise crowdfunding - Traditional financial operators
Where is it Used? (Kickstarter stats)
Printrbot: 3D printer
TikToc LunaTik & Pebble
PID-Controlled Espresso Machine
An equity-based
campaign
11stst round: round:
10% of company 10% of company sharesshares
£230 / share£230 / share1300 investors1300 investors20% discount in the 20% discount in the
shopshop
22ndnd round: round:8% of company shares8% of company shares£95 / share£95 / share5000 investors5000 investors90% sold in 3 months90% sold in 3 months £1m Investment in less £1m Investment in less
than 2 weeksthan 2 weeksIndividual investments Individual investments
ranged between £95 ranged between £95 and £12K and £12K
33rdrd round: round:3.9 % of company 3.9 % of company
sharesshares£95 / share£95 / share1M invested in one day1M invested in one day4M target (January ‘14)4M target (January ‘14)
Crowdfunding in Italy
Italian Crowdfunding Platforms Overview. Castrataro, Pais, April 2013
20+ active platforms, 20+ launching
Crowdfunding growth in Italy
Works on Regulation
The Path to the Regulation
April ‘12 Oct ‘12 Dec ‘12 Mar/Apr ‘13 July ‘13
Regolamento Consob n. 18592/2013
Purpose of CONSOB regulation
• Enable the development of an initial phase of ‘testing’ of capital raising through online portals, with the main purpose of promoting the development and growth of the country.
Seeking the balance
- Market development
- Lowering of barriers
- Protection of the market
- Protection of unaccredited investors