Crowd Funding Visions

7/27/2019 Crowd Funding Visions

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This publication has been produced by four frontrunners from the eld of crowdfunding in

Europe: Daniela Castrataro, Fabien Risterucci, Gijsbert Koren and Karsten Wenzlaff.

This publication was made possible by Epirot Ludvik Nekaj (organizer Crowdsourcing

Week), Wolfgang Gumpelmaier (Gumpelmedia/ikosom), Nina Passerelli (student) and all

crowdfunding platforms that contributed by sharing their visions.

This publication is a follow-up for two European conferences on Crowdfunding:Crowdfunding Day(Amsterdam, April 15th 2013) and The Future of Crowdfunding(Berlin,

April 17th 2013)

The views expressed in this publication are those of their respective authors and do not

necessarily reect the position of the producers of this publication.

Creative Commons

This publication is released under the following license: CC BY NC SA 3.0. Attribution-

NonCommercial-ShareAlike 3.0 Unported License.
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About the publishers

Daniela Castrataro

Daniela is co-founder and

director of twintangibles,

a Scottish-Italian research

and advisory rm that helps

organisations create value

from the application of

social technologies. She

is co-founder of the Italian

Crowdfunding Network.

twintangibles, together with

nois3lab, are the founders

of crowdfuture The Future

of Crowdfunding, the rst

crowdfunding conference in

Italy.

Fabien Risterucci

As a consultant (FRProspektiv) Fabien facilitates

the international business

development of innovative

business concepts in high-

growth areas. He has been

conducting research on

crowdfunding for the last

three years, co-launched

the discussion group

Crowdfunding for Europe

and has been an active

member of the French

crowdfunding professionalassociation, Financement

Participatif France.

Passionate about disruptive

innovation, entrepreneurship

and development nance,

Fabien has a background

in economic development,

investment attraction and

international business

development in Europe

and Asia. He was trained

in Political Sciences,

Business Administration,

Competitive Intelligence,

and in Micronance. Fabien

is based in Paris and is

frequently in Germany.

Gijsbert Koren

Gijsbert is a creative

entrepreneur andcrowdfunding addict. He

found out the hard way that

funding from a bank or one

investor could be hard to

attain, even if (potential)

users were interested.

Hacking the system, by

getting money directly

from consumers to fund a

product, seemed to be an

interesting alternative.

Gijsbert is managing

partner at Douw&KorenCrowdfunding Consultancy

and advises companies,

governments and other

organizations on using

crowdfunding.

Karsten Wenzlaff

Karsten is one of the

co-founders of ikosom

Institut fr Kommunikationin sozialen Medien, a

private research-center

based in Berlin. He has

conducted research

on crowdfunding since

2011 having published

the rst crowdfunding

survey in Germany. He is

also co-author of the rst

Crowdsourcing Report in

Germany. He has a BA inPhilosophy & Economics

and a MPhil (cantab) from

the University of Cambridge.


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Introduction

Crowdfunding is a source

of nance for projects

and businesses, with the

specic characteristic

that the capital is raised

by the crowd: a group of

individuals donate or invest

relatively small amounts of

money. The main types of

crowdfunding are: donationbased, reward based (pre-

sales/non-nancial return),

loan based and equity

based. Besides capital,

crowdfunding also results in

gaining more visibility for a

project or company, as well

as generating involvement

and support from a large

group of people.

Crowdfunding is changing

the way we think about

nance. But what will the

future of crowdfunding look

like? With this publication,

we share our views and

the ones of European

crowdfunding platforms on

the future of crowdfunding.

Crowdfunding has been

used as well to nancethis publication. We would

like to thank all early

supporters who believed in

the importance of sharing

visions on the future of

crowdfunding in Europe.

The main goals of this

publication are:

1. Sharing visionsIt provides researchers,

politicians, entrepreneurs,

investors and government

ofcials with visions

regarding the impact of

crowdfunding in Europe.

2. Initiating discussions

It helps to initiate a

discussion about future

trends and developments

in crowdfunding andcrowdinvesting.

With this publication, we

hope to contribute to the

further development and

growth of crowdfunding in

Europe.

- Daniela, Fabien, Gijsbert

and Karsten

November 2013


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Civic Crowdfunding

During the last few years,

crowdfunding has become a

far wider and more complex

phenomenon, having

developed into many trends

and models. In my opinion,

one of the most interesting

ones is civic crowdfunding.

Civic crowdfunding seemsto be a solution to the

lack of funds in local

governments, much like

crowdfunding in a wider

sense presents itself as a

solution to the lack of capital

on the market.

Whereas crowdfunding in a

general sense is based on a

potentially global audience,

local crowdfunding looks for

funds in a geographically

small area, which implies a

small community in terms

of numbers. In fact, local

communities seem to be

a suitable environment in

which civic crowdfunding

can ourish, as this aims at

nancing local works and

projects. Therefore, we are

talking aboutrelationshipcapitalhere, rather than

social capital, i.e. few but

strong relations that form

tightly bound communities,

rather than large networks

with weak ties between

them.

The development of a strong

bond between citizens

and their territory, thecitizens active involvement

in discussing and giving

their feedback, their

willingness to cooperate

directly or indirectly with

the local administration

on choices aimed at the

local community would

nd in civic crowdfunding

a perfect tool. The process

would both address the

scarcity of capital in localadministrations and bring

citizens closer to institutions,

thus increasing peoples

respect for public assets

and implementing a model

of active citizenship and

collective and sustainable

innovation.

The key point seems to

be both to facilitate digital

cooperation and to build

ofine relationships. In

fact, the real power of the

crowd does not lie with

people randomly connecting

on the web. The future of

this technology seems to

be pointing towards local

online environments that

promote strong interactions

both online and ofine. As

I see it, this is the future ofcrowdfunding, and civic

crowdfunding is the future.

- Daniela Castrataro


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The sums collected by

Europe-based internet

crowdfunding platforms

register an exponential

progression. This could

be of quite a different

importance, and especially

have a greater economic

impact, if platforms

beneted from a Europeanregulatory framework

adapted to the nature

and potential risks which

engenders their activity.

So far the lead action has

been situated at the national

level. The key players of

the European crowdfunding

sector already compelled

themselves to greater

transparency by creating

national professional

associations and by

working on their respective

self-imposed Code of

Conduct, which are codes

of best practice committing

platforms to provide services

with full transparency, safety,

assistance, ethics, and

respecting the laws and

regulations.

Several national

governments, such as the

United Kingdom, Italy and

Austria have been dealing

with the regulation of

crowdfunding. Portugal has

seen some interesting local

initiatives recently as well.

France is about to facilitate

the multiple forms ofcrowdfunding and discusses

the creation of a special

status of Crowdfunding

Service Provider (conseiller

en investissement

participatif). But for now,

the laws are very different

from one country to another.

This could represent

an impediment to the

development of internet

platforms in the short tomedium-term as by the

nature of their business,

they cannot know national

boundaries of their market.

An initiative at European

level is also under way

with the European

Crowdfunding Network and

the determination of the

crowdfunding sector that

rallies in Europe.

Moreover, the different

workshops organized

by the EESC, the SME

Assembly, DG Connect,

and DG Internal Market and

Services of the European

Commission in the

presence of Commissioner

Michel Barnier to review

the opportunities andrisk reduction related to

crowdfunding, conrm the

direction taken towards

a likely forward evolution

of the European texts.

To remedy disparate

national level legislation,

the European Commission

has taken over the case

and has launched a public

consultation so a project canstart to be developed from

next year.

So, after months of

exchanges and raising

awareness in small

committees on the

benets offered by

crowdfunding, proposing

a special European level

status of Crowdfunding

Service Provider, this

synchronization betweenadministrations denotes

a real commitment of the

authorities towards concrete

action on the subject.

Having spent a few years

analyzing micronance and

crowdfunding (also called

collaborative funding) and

what I call community

funding, it is fascinating tomeasure how much it allows

to aggregate entrepreneurs,

creators, the nancial

sector, governments,

local governments,

economic development

stakeholders and above all

us all European citizens and

citizens of the world whom

we are.

Nobody knows today what

will happen to crowdfunding

in the next couple of years.

What is certain is that it will

become a real alternative for

start-up and seed capital.

I hope that the dynamism

and creativity of European

entrepreneurs will be

enhanced by a new

regulatory framework atthe European level. At

the same time bold, this

Crowdfunding regulation at European level


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framework should be

non-discriminatory, fully

complementary with other

sources of funding and

ensure the professionalism

of this emerging industry.

Allowing the multiple forms

of crowdfunding platforms

to operate freely acrossboundaries would be for

the European Union the

sign of a will to continue

the deepening of the Single

Market.

- Fabien Risterucci


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Growing Crowdfunding

Innovation and the start

and growth of new projects

and companies are an

important engine of our

economy. It is therefore

of great importance to

provide these projects and

companies with access to

capital. Crowdfunding can

contribute in providing betteraccess.

The crowdfunding market

is growing fast

In Europe, there are a

few hundred operational

crowdfunding platforms,

making it possible for

projects and companies

to (added all together)

raise hundreds of millions

of euros in 2012. The

market is expected to

keep on growing very fast.

Crowdfunding will grow into

an important alternative to

other sources of nance for

projects and companies.

However big the potential

impact, I think there are

some obstacles that have

to be addressed in order torealise this potential.

1. Many people, projects

and companies are not

familiar with crowdfunding

yet

Although crowdfunding

could be an alternative

source of nance, many

people are still ignorant

about the existence and highpotential of crowdfunding.

Besides that, not all

government bodies and

authorities fully acknowledge

crowdfunding for being a

relevant source of nance.

Moreover, knowledge about

how to make best use of

crowdfunding is still not

widely spread, resulting

in people, projects and

companies not consideringor using crowdfunding yet.

Via directed communication,

more awareness can be

raised for crowdfunding.

Communication can be

specically targeted at high

potential funders, projects

and companies. To integrate

crowdfunding into nancial

planning, business advisors,

bankers and accountants

can also be important

partners.

2. A roadmap for

legislation and

professionalization

With growth, comes

professionalization.

In several countries,

crowdfunding platforms

are formulating a Code

of Conduct to create acommon set of quality

standards. Next to self-

regulation, legislation is

of importance to protect

investors and companies. In

relation to crowdfunding, it

is often unclear for platform

owners, funders, projects

and companies which

legislation applies and what

that effectively means atan operational level. An

on-going dialogue between

crowdfunding platforms, the

government and nancial

authorities is essential

to overcome barriers in

legislation and react in a

timely manner on undesired

developments.

3. Financing the growth of

platformsA high growth potential

puts pressure on cash ow.

Crowdfunding platforms are

(besides a few exceptions)

relatively small companies.

This results in the challenge

of nding enough capital

to nance growth. It is

important to support

crowdfunding platforms in

realising growth to reacha scale at which they can

contribute substantially

to providing access to

capital for projects, starting

companies and SMEs. Both

governments and venture

capital funds could prove

to be an essential partner

for nancing the growth of

crowdfunding.

- Gijsbert Koren


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Crowdfunding on the

internet is a fairly new

phenomenon. Although

established as a cultural

practice for centuries, digital

crowdfunding which we

have seen emerge in Europe

and in the US has brought

new models, fascinating

projects and new standards.

Along with these

developments, a wide range

of institutions have tried to

quantify this market and

thus set standards for its

analysis. The differentiation

of equity-based, reward-

based, lending-based and

donation-based platforms,

as blurry as it is, came with

the desire to cluster the

platforms and make them

comparable.

The next step for the

industry will be to have

reliable data about the

market. I predict that we

will have institutions which

provide market data,

platform comparisons,

success statistics andcomparisons between

platforms. Right now,

with some 500+ platforms

worldwide, such an overview

for investors, donors and

project-owners is absolutely

necessary to simplify the

access to crowdfunding. It

will also give institutional

investors a way to use

crowdfunding as an assetclass, alongside traditional

forms of investments like

corporate bonds, equity

and government debt. It

will also allow the media

to distinguish trends from

hypes and make evaluations

based on real market-data.

At crowddata.eu we will

provide a lot of data for the

European market and makeit accessible for a wide

range of audiences. This

will be done in a constant

dialogue with the platforms

and other stakeholders.

- Karsten Wenzlaff

Crowdfunding Data


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Crowdfunding is about citizen banking.

- Arnaud Poissonnier, President at Babyloan

Babyloan is a French social micro-lending platform

www.babyloan.fr


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As more platforms become regulated, more investors

will see equity crowdfunding as a trusted, mainstream

avenue to grow their capital.

- Alysia Wanczyk, Marketing Director at Seedrs

Seedrs is an English equity based crowdfunding platform

www.seedrs.com


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Crowdfunding is going to be a new and attractive

nancing model in Europe and a serious alternative for

the nancing of startups.

- Dana Melanie Schramm, Corporate

Communications at Seedmatch

Seedmatch is a German equity based crowdfundingplatform

www.seedmatch.de


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In our information oriented world donors nd it

increasingly important to know how their donations are

used. Donors prefer to give to projects where they feel

to be part of a bigger goal. Crowdfunding supports

these trends by clearly dened projects and goals with

the possibility to empower a large group of supporters.Crowdfunding also brings the fun in fundraising by the

rewards an organization gives supporters back for their

donations.

Non-prot organizations now start to include

crowdfunding as an integrated part of their online friend

and fundraising strategy. In this strategy successful

non-prots will engage supporters and facilitate them

to contribute to the goals of the organization in the wayeach individual supporter prefers.

- Marc Schoutens, Director at Mobillion

Mobillion creates crowdfunding software

www.mobillion.nl


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A new way to see ideas come to reality. For the US and

European countries, crowdfunding is a real opportunity

to overcome the crisis.

- Fabio Simonelli, Project Manager at Eppela

Eppela is an Italian reward based crowdfunding platform

www.eppela.com


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We are just at the very begining in Europe. More and

more internet users become aware of what crowdfunding

is and how it works. Europe does not have much million

EUR projects at this stage, but that number will grow

quite soon. Politicians will begin to understand thatthey should promote crowdfunding, and Europe will

have its own crowdfunding act. With the act in place,

it will be possible to fund even bigger projects through

crowdfunding.

- Arnaud Burgot, CFO at Ulule

Ulule is a reward based crowdfunding platform for all

European countries

www.ulule.com


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Crowdfunding is a tool for society to allocate nancial

resources to the projects and ideas they believe in. It

enables the society to shape the society without usage of

intermediates like the state or banks.

- Christin Friedrich, Director at Innovestment

Innovestment is a German equity based crowdfundingplatform

www.innovestment.de


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Pan-European equity based crowdfunding for investors

of all backgrounds will be the future of crowdfunding,

with no limits to funding amount.

- Philipp Steinberger, CEO at c-crowd

c-crowd is a Swiss equity based crowdfunding platform

www.c-crowd.com


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This is only the start of crowdfunding. More is to

come, particularly in the eld of governance and public

infrastructure as well as at the level of local decision-

making.

- Gregory Vincent, founder at Sponsume

Sponsume is a reward based crowdfunding platform

from the UK

www.sponsume.com


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Facebook likes and crowdfunding donations are both

PR tools. However, people will be more attached through

funding.

- Konrad Lauten, CEO at Inkubato

Inkubato is an Austrian/German reward based

crowdfunding platform

www.inkubato.com


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The global crowdfunding market will be 1000 billion

euros by 2020.

- Thierry Merquiol, CEO at WiSEED

WiSEED is an French equity based crowdfunding

platform

www.wiseed.fr


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Equity based crowdfunding will grow strongly in the

coming years, given the high level of start-ups seeking

between 100,000 and 1 million.

However, the high risk nature of the proposed

transactions may result in the closure of manyplatforms that will not have enough good projects

selected upstream. Indeed, if investors want to live an

entrepreneurial adventure, they also want to earn money.

Reward based crowdfunding will also grow strongly,

particularly for projects before creation (to test new

business).

- Anne Saint Lger, CEO at Finance Utile

Finance Utile is a French equity based crowdfunding

platform

www.nanceutile.fr


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Crowdfunding is and will be an essential tool to raise

money for every kind of activity, matching entrepreneurial

and social principles, practices and visions.

- Claudio Calveri, Senior Content Manager at DeRev

DeRev is an Italian donation and reward based


www.derev.it


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We believe that crowdfunding is a great tool that

can be applied to many different sectors. Platforms

promoting itself as non-specialised, will naturally become

specialised in the end, as communities will stick and give

colour to a platform.

- Alexandre Laing and Stphane Vromman, founders

at Bulb in Town

Bulb in Town is a French crowdfunding platform for local

initiatives

www.bulbintown.com


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Using mobile platforms and cyber currencies will be a

next step for crowdfunding.

- Angelo Rindone, founder at Produzioni dal Basso

Produzioni dal Basso is an Italian donation based


www.produzionidalbasso.com


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The future of equity-based crowdfunding will be

dominated by local investing platforms. Heres why:

some people are interested in investing in specic

sectors (e.g. clean energy), whereas others want to

support specic individuals (e.g. African entrepreneurs,female-led startups). However, everyone wants to

support their local economy. As such, we believe local

is going to be the major force that will drive equity-based

crowdfunding into the mainstream.

- Kristian de Groot, founder at Investeer Lokaal

Investeer Lokaal is a Dutch equity based crowdfunding

service

www.investeerlokaal.nl


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Crowdfunding will bring news ways for Europeans to

exchange, relate, and exercise a collective force that

will reinforce European identity. In the eld of energy,

crowdfunding will be a change maker that will empower

citizens and reveal the relevancy of regional solidarity. Istrongly believe that community-based nancing is an

effective tool for European citizens to join forces for the

transition towards renewable energies.

- Alex Raguet, Cofounder and President at Lumo

Lumo is a French crowdfunding platform for renewableenergy projects

www.lumo-france.com


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Crowdfunding is just part of the deeper peer-to-peer

revolution, that will empower citizens and give them back

control on their everyday life!

- Fabrice Carrega, CEO at Arizuka

Arizuka is a French reward-based platform

www.arizuka.com


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Crowdfunding will make sure that every European citizen

will get a chance to become part of The Next Big Thing,

while more ideas and companies are put to the market.

- Daniel Daboczy, CEO at FundedByMe

FundedByMe is a European equity based crowdfunding

platform

www.fundedbyme.com


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Reward based crowdfunding will be a democratization

of peoples chances, to support artists and startups they

belive in. No more curation by so-called experts - the

crowd decides with their money and entrepreneurs

have a new source of funding.

- Michael Eis, Founder at Booomerang

Booomerang is a Danish crowdfunding platform

www.booomerang.dk


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In a few years, crowdfunding will be an established andwell-known nancing tool for the lm-industry worldwide.

But more importantly, it will be also embedded in the

overall communication strategies, as it supports the

lmmakers, the producers, the cast to be in touch with

their audience and get direct feedback in all stages

of the production and distribution process. This direct

link to the people will be crucial, not only in terms of

nancing, but also marketing a movie. Hopefully there

will also be specialized lm-crowdfunding platforms that

address all groups, lmmakers and moviegoers, and

will represent all their needs within one platform, from

communicating the idea of a lm, nancing of that idea

and then distributing the nished movie.

- Wolfgang Gumpelmaier, CEO at Gumpelmedia

Gumpelmedia has expertise on crowdfunding for the lm

industry

www.gumpelmaier.net


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Real money for realy projects.

- Reinhard Willfort, founder at 1000x1000

1000x1000 is an Austrian crowdfunding platform

www.1000x1000.at


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Crowdsourcing and crowdfunding are transitioning us

into a more open, connected, and socially productive

society. At Crowdsourcing Week, our big, ambitious

goal is to get everyone thinking about collaborating with

their stakeholders to create shared value. Companies,government and social enterprises can now interact with

their communities on a completely new level - through

more than just social media interactions. Imagine social

media turning into purpose-driven social productivity

- crowdsourcing and crowdfunding are driving this

revolution.

- Epirot Ludvik Nekaj, founder at Crowdsourcing

Week

Crowdsourcing Week organizes crowdsourcing events

around the world

www.crowdsourcingweek.com


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Crowdfunding unleashes creativity.

- Vincent Ricordeau, co-founder and President at

KissKissBankBank

KissKissBankBank is a French crowdfunding platform

www.kisskissbankbank.com


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Documents

Crowd Funding Visions