Recent Data on Crowdfunding, Alternative Finance & New Markets

Dr. Richard Swart at SVCrowdfund

Crowdfunding Research.

At the SVCrowdfund conference on April 3, 2014, Richard Swart, PhD., gave a fascinating presentation on the growing ecosystem of crowdfunding and alternative finance.

Dr. Swart is a well known authority in the crowdfunding world.  He runs the UC Berkeley’s crowdfunding research initiative and is also a partner at Crowdfund Capital Advisors Group.  He spends plenty of time traveling the globe – sharing his unique perspective into the disruptive innovation of crowdfunding.

This new form of finance is growing rapidly in many parts of the world.  It is fast being recognized as a “viable international market for institutional investments, allocation of capital in debt instruments, and relatively low risk equity transactions into micro-enterprises”.

Crowdfunding is creating jobs by funding small companies – many of which go on to capture additional investments – and boosting national economies.  The technological efficiencies generated by crowdfunding portals reduce friction between investor and Alt Finance Crowdfunding Richard Swartcompanies in need of capital.

Crowdfunding is also recognized as a proven method for product validation, customer engagement and dramatic marketing impact.  Some companies do not even need the funding – they want the earned media and user engagement.

 

Additional bullets from the presentation:

  • Evidence indicates fraud is NOT an issue & there has been NO fraud to date in equity crowdfunding
  • Fraud is more difficult to create in the transparent world of investment crowdfunding
  • Over 90% of groups raising more than $5000 in successful crowdfunding continue on to become viable firms
  • Evidence shows that crowdfunding is more effective at selecting viable firms
  • Online consumer finance is rapidly threatening banking models
  • Money is flowing from the Heartland to the coasts

Crowdfunding is on the cusp of a global boom.  In the countries where it is allowed to thrive the benefits will be legion.

The entire presentation is embedded below.

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