Development stages of crowdfunding

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Disclaimer: due to some suggestions since now I’ll publish some posts in english for foreigners interested in main topics of These blogposts will be similar to those written in Polish. You may find english versions in the tag cloud (tag: english version) and in categories list (category: english version). Fell free to contact, comment and share.

First time since I’ve been blogging I’m writing in english. First (2) things first – forgive me my English and remember that what counts is content, not a form.  I’m not a graphic designer, which I actually regret sometimes…

While working on my bachelor composition I made few thoughts on the history of crowdfunding.
Nowadays we observe this financial mechanism rolling really fast. Someone clever called such fast growth the snowball effect and so it respectfully do describe correctly what’s going on. Few days ago kickstarter annouced to exceed 53 000 000 $ collected money to support (“back” as it is called on KS) over 20.000 projects with success rate of 43%. Many others wish to eat at least a piece of kickstarter’s birthday cake. So there are few non-equity crowdfunding platforms in almost every developed country in Europe, not to mention many in the U.S. and Australia. First kickstarter clones are (finally) starting up in Poland, which was my  concern since I’ve been running this blog. What is also important, SEC (Securities and Exchange Comission) answered officially to efforts put in legal fight for crowdfunding. Actually it doesn’t look like we’re going to be spectators of equity crowdfunding boom soon, but the news is important.

I decided to sum up recent history of crowdfunding and possibly start the debate on how will it develop in the future. Additionally enjoy first sketch of blog’s new logo 🙂

I put some work in determining the chronological order of next stages. It’s hard to define what crowdfunding exactly is, let alone find a logic, and chronology in it! While statue of RoboCop in Detroit has been crowdfunded recently, how can we call it logic? Though, I really enjoy everything that touches upon the topic, starting with startup’s venture capital, ending on wise crowd that crowdsource.

Few comments on my so-called-but-don’t-call-it-that-way infographic:

  • Many crowdfunding campaigns took place long ago, before this term was commonly used, as it is. Mostly by musicians and in the film industry. However, it doesn’t fit the definition, Statue of Liberty was also crowdfunded, what I’ve already described.
  • 2006 with SellABand and later with other websites non-equity crowdfunding has been established. With some really successful projects funded on kickstarter the buzz and the boom started. In the near future we might see some M&A’s and/or speculative bubbles in this area (probably I’m just kidding). What is important, it’s a great opportunity for small enterpreneurs and creatives to test and market their business ideas.
  • 2009 Trampoline Systems planned to finance its further development by crowdfunding 1 000 000$. First tranche has been collected so quickly, that it seemed to be a great capital source, considering Venture Capital/Private Equity liquidity crisis. And it’s not the only one example of equity crowdfunding successful financing.
  • 2010 bring few initiatives that aim at changing securities regulations in the way, that small crowdfunding offerings will be allowed. Current proposition shows something like 100 000USD maximum gap collected from 100$ individual investment’s. It seems, that legally it is possibile to create new asset class, which will be a specially regulated (actually exempted) security which will allow equity crowdfunding to explode.
  • What are next stages is a good question, one might say… But, what are they?

As I read in “The crowdfunding revolution” by Marom and Lawton: social networking changed how we allocate time, crowdfunding will change how we allocate money“. That might be true, so keep this in mind, spread the word using your magic social media tools and enjoy sunny days in may!

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Karol Król

Karol Król

Od 2010 prowadzę i angażuję się w zrównoważony rozwój sektora finansowania społecznościowego w Polsce i w Europie. Zapraszam do dyskusji!