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Crowdfunding the crowdfunders

April 15, 2016 • By


The crowd finance industry, having established the first generation of platforms for funders and fundraisers to transact, is now supporting its own next generation. Those keeping pace with the developments may know that new platforms are successfully raising on other platforms, and existing platforms are using their own services to raise their own funds.

The crowd finance industry, having established the first generation of platforms for funders and fundraisers to transact, is now supporting its own next generation. Those keeping pace with the developments may know that new platforms are successfully raising on other platforms, and existing platforms are using their own services to raise their own funds. Those in the professional investment community who are anticipating evolving to accommodate the disruption of crowd finance, now not only need to keep pace with the opportunities presented by the platforms and maturing early entrants, but also the next generation of platforms themselves.

We've taken a look at the numbers to show you just how many platforms are already raising using crowd finance. We found 122 raises across 33 platforms, out of which 44 campaigns successfully funded more than $1,000. To analyse the funded campaigns, we grouped them into 3 categories based on the amount raised ($1k - $100K, $100k - $500k and $500k plus).

The graph above shows 15 campaigns that raised between $1k and $100k. The campaigns in this category were predominantly reward-based (80%) and included companies mainly in the conceptualisation phase of the business. Most of the reward campaigns are therefore located at the bottom left of the graph meaning that they were aiming to raise less than equity and also collected less. The average raised for reward campaigns was $37k while the average was $65.7k for equity campaigns.

Though the reward campaigns were raising less, they also required more funders on average (72) than the equity campaigns (46). There are 3 campaigns below the orange line, which means that they did not reach their target goal, but were considered successful ("flexible funding" is allowed at some reward platforms, hence classified as successful).

In the next category, $100k and $500k raises, there were 19 funded campaigns. For these larger raises, an average of 94 funders backed the proposal. The 12 campaigns that overfunded received an average of 203% of their target.

The $500k+ category had the most marked overfunding figures. 9 of the 10 campaigns overfunded, achieving 244% of their target goal on average. The number of funders was also higher, with an average of 329 per campaign.

The largest deals of all raised in excess of $1M; they were Assetz Capital raising $4.7M on Seedrs, Crowdcube raising $2.3M on its own platform, Crowdfunder raising $1.9M on Crowdcube and Invesdor raising $1.1M on its own platform.