The Crowdfunding Industry Report
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2015CF THE CROWDFUNDING INDUSTRY REPORT MASSOLUTION.COM © Massolution 2010-2015, All rights reserved. Massolution provides you with a limited license to view and use this report subject to the terms contained herein. If you do not agree to the terms of this license agreement, you may not view or use this report and must immediately delete or destroy all copies of this report within your possession. Massolution provides you with a limited, non-exclusive, personal, non- transferable, and revocable license to view one copy of this report and to publish up to two charts contained within this report for non-commercial use. All published charts must contain a full citation to the report and a link to http:// www.crowdsourcing.org/research. All other rights are reserved. You are expressly prohibited from reproducing, creating derivative works of, distributing, publicly performing, publicly displaying, or transmitting the report in a manner not otherwise expressly allowed under these terms, including photocopying, forwarding, publishing, or providing the report to unlicensed users. You acknowledge and agree that all proprietary information contained within this report is the property, trade secrets, and confidential information of Massolution. Please contact massolution at [email protected] with all inquiries concerning multi-user licenses or any other questions. 2 Copyright © 2010-2015 Crowdsourcing LLC. All Rights Reserved. 2015CF MASSOLUTION.COM GoFundMe Tops Kickstarter as World’s #1 Crowdfunding Platform GoFundMe - A 2015CF Research Sponsor 3 Copyright © 2010-2015 Crowdsourcing LLC. All Rights Reserved. 2015CF MASSOLUTION.COM 4 Copyright © 2010-2015 Crowdsourcing LLC. All Rights Reserved. 2015CF MASSOLUTION.COM TABLE OF CONTENTS Introduction ................................................................................................. 8 Foreword ...................................................................................................... 8 Global Crowdfunding: Adoption, Evolution and Growth....................... 8 Key Findings ................................................................................................ 13 Worldwide Funding Volumes .............................................................. 13 Average Funded Campaign Size ........................................................... 15 Observations and Trends .................................................................. 17 Predictions ........................................................................................... 22 About this Research .................................................................................... 25 The 2015CF Crowdfunding Industry Report ........................................ 25 The Research Team .............................................................................. 28 About Massolution ............................................................................... 33 Crowdfunding Defined .............................................................................. 34 Definitions ............................................................................................ 34 Overview and Taxonomy ...................................................................... 37 Crowdfunding Models .......................................................................... 40 Crowdfunding Market Growth and Composition ......... 50 Introduction ............................................................................................... 50 Market Analysis .................................................................................... 50 Crowdfunding World Map: Funding Volume ........................................ 51 Total Funds Raised................................................................................... 51 Growth by Crowdfunding Model ............................................................... 54 Funding Volume Distribution by Model ................................................ 54 Growth by Crowdfunding Region ............................................................. 57 Funding Volume Distribution by Region .............................................. 57 Campaign Statistics .................................................................................. 59 Average Campaign Size .......................................................................... 59 Funding Probability ................................................................................ 62 Pledged vs. Paid Out Ratio....................................................................... 66 Most Active Categories................................................................................. 67 Top Performers .................................................................................... 67 5 Copyright © 2010-2015 Crowdsourcing LLC. All Rights Reserved. 2015CF MASSOLUTION.COM TABLE OF CONTENTS Funding Concentration 70 70 Global market share of leading CFPs .................................................. Regional Market Share of Top 5 and Top 10 CFPs .............................. 73 Leaderboards: By Region, By Model .................................................... 75 Crowdfunding Platform Distribution ...................................................... 82 Growth in number of CFPs worldwide ................................................ 82 CFP World Map ...................................................................................... 83 CFP Distribution by Model ................................................................... 85 Crowdfunding Market Predictions 2015 ................................ 94 Market Growth and Composition ........................................................... 94 Predictions: Regions ............................................................................ 94 Predictions: Crowdfunding Models ................................................... 96 Observations and Trends ................................................................. 102 Prognostications ......................................................................................... 102 102 An Evolving Landscape .......................................................................... Acknowledgments ................................................................................. 107 6 Copyright © 2010-2015 Crowdsourcing LLC. All Rights Reserved. 2015CF MASSOLUTION.COM INTRODUCTION FOREWORD KEY FINDINGS ABOUT THIS RESEARCH CROWDFUNDING DEFINED 7 Introduction FOREWORD TOTAL GLOBAL SECTION OVERVIEW GLOBAL CROWDFUNDING: ADOPTION, EVOLUTION “ FUNDING VOLUME IN AND GROWTH 2013 REACHED $6.1BN, • ACROSS THE MODELS The growth of the global crowdfunding industry has continued with annual REPRESENTING 125% growth rates exceeding prior years in each of 2012, 2013 and 2014. In our 2013CF ANNUAL GROWTH • FINANCIAL VS. Crowdfunding Industry Report, we reported that crowdfunding platforms raised OVER 2012. NON-FINANCIAL a total of $2.7bn in 2012, compared with $1.47bn in 2011, and we forecasted CROWDFUNDING that total funding volumes would reach $5.1bn in 2013. We can now confirm that global crowdfunding volumes in 2013 in fact reached a shade under $6.1bn. MODELS This represents market acceleration from an 83.7% annual growth rate1 in 2012 to an annual growth rate in 2013 of 125%. The delta between our forecast • INDIVIDUAL MODELS and our confirmed 2013 numbers can be attributed to faster than anticipated gains made in the new high growth category of real estate crowdfunding (see Massolution’s new report 2015CF-RE Crowdfunding for Real Estate) and further insight we have gained into rapidly expanding markets, in particular in Asia and “ in Europe. In part, this resulted from increased survey participation from Asian crowdfunding platforms (CFPs), and more Asian CFPs directly publishing their numbers. As we will present in this report, market growth continued accelerating in 2014 and we are forecasting a further doubling of the market in 2015. We have witnessed additional platforms coming online across asset classes and methodologies. Real estate and small to medium sized enterprise (SME) financing platforms are drawing a lot of attention; crowdfunding for startups is on the rise; and crowdfunding for social impact causes is as relevant as ever. Lending-based crowdfunding continues its upward climb as both Prosper and LendingClub have surpassed, in 2014 alone, the $2bn and $4bn mark, respectively, in originations. This year we surveyed approximately 1,250 CFPs, up from 813 CFPs in 2012. The number of new platforms and their distribution are supporting crowdfunding’s development as a truly global phenomena. [1] Massolution uses “annual growth rate” as a measure of year-over-year change using the prior year as a base for expressing percentage change from one year to the next. 8 Copyright © 2010-2015 Crowdsourcing LLC. All Rights Reserved. 2015CF MASSOLUTION.COM Introduction FOREWORD NO FINANCIAL GLOBAL CROWDFUNDING: ADOPTION, EVOLUTION “ INSTITUTION CAN BE AND GROWTH (CONT.) MISINFORMED ABOUT Impact crowdfunding continues to develop, both at the micro and (importantly) CROWDFUNDING, AS at the macro levels, as part of government policy. In other words, crowdfunding IT PROVIDES BOTH is being embraced by nations around the world to frame economic development COMPETITIVE AND programs. PROMISING NEW OPPORTUNITIES. Broader access to investment opportunities globally may have direct benefits in parties seeking to ascend the economic ladder. Whether referencing the annual World Economic Forum in Davos