What was the first crowdfunding website?
The first recorded successful instance of crowdfunding occurred in 1997, when a British rock band funded their reunion tour through online donations from fans. Inspired by this innovative method of financing, ArtistShare became the first dedicated crowdfunding platform in 2000.
When did equity crowdfunding start?
The first known equity based crowdfunding platform was launched in 2007 in Australia, called the Australian Small Scale Offerings Board (ASSOB). ASSOB now trades as Enable Funding, a securities licensed equity raising platform that has raised over $150 million for 176 private companies.
Is equity crowdfunding a good investment?
Pros of equity crowdfunding Selling shares to multiple investors may raise more cash. Equity platforms may pool the funds into a single investment, streamlining the accounting and financial reporting. No loan repayments or debt-related credit checks required.
How many crowdfunding sites are there?
As of 2021 there are 1,478 crowdfunding organizations in the US (Crunchbase, 2021). Currently the three largest crowdfunding platforms are Kickstarter, Indiegogo, and Crowd Supply. As of January 2021, Kickstarter has raised more than $5.6 billion spread over 197,425 projects.
What is equity based crowd funding?
Equity crowdfunding (also known as crowd-investing or investment crowdfunding) is a method of raising capital used by startups. Each investor is entitled to a stake in the company proportional to their investment.
Is equity crowdfunding good or bad?
Pros of Equity Crowdfunding . It’s smart money. By taking angel investing (individuals investing in startups) online, equity crowdfunding has opened up this type of investing to more and more people. There are very accomplished investors using these platform whose contribution may add to the success of your business long term.
Is investing in equity crowdfunding a good idea?
Investing through equity crowdfunding can give the investor a greater degree of personal satisfaction than investing in a blue-chip or large-cap company. This is because the investor can choose to focus on businesses or ideas that resonate with them, or that are involved with causes in which the investor has a deep belief.
Are equity crowdfunding websites regulated?
Investors in equity crowdfunding (i.e. Reg CF and Reg A+) have over 50 different websites as of August 2019 that they can use to invest in startups. These websites – called crowdfunding intermediaries – are the regulated entities that allow the sale of early-stage financial securities to both accredited and non-accredited investors.
What are major problems with equity crowdfunding?
Equity dilution. Since equity crowdfunding is related to the issuance of new shares,the stake of current shareholders will be diluted.