Let's get together: crowd funding portals bring in the bucks
TMT Technology Predictions 2013
Deloitte predicts that crowd funding portals will raise $3 billion in 2013, double the $1.5 billion raised in 2011.
A note from the authors
Crowdfunding portals are websites that enable large numbers of individuals to financially support a project or company, with each backer contributing just a small percentage (generally less than one percent) of the total funding. A typical crowdfunded project has thousands of backers.
Equity-based crowdfunding is often discussed as an alternative to VC for small to mid-size firms. Growth is accelerating as new platforms are launched, investor interest rises and regulatory constraints are reduced. In the United Kingdom, there are several platforms that provide equity-based financing for startups and growth capital. In the US, a large crowdfunding portal raised $15 million in venture capital to pursue expansion into equity crowdfunding. In Canada, an alternative stock exchange has publicly stated its support for crowdfunding and a provincial government is contemplating an exemption to the accredited investor rule for crowdfunding sites.
This podcast introduces our listeners to crowdsourcing portals and what Deloitte predicts for 2013. Is crowdfunding simply an alternative to traditional venture capital, or is there actually much more to the concept? Could crowdfunding replace traditional venture capital, and what are some practical examples and implications for 2013?
Duncan Stewart, Director of TMT Research, Deloitte Canada, and co-author of TMT Predictions.
Stephen Harrington, a senior consultant in Deloitte's Canadian Human Capital practice who recently co-authored CanadaWorks2025.
Stephen Heasley, Global Online Communications, Deloitte Touche Tohmatsu Limited