Crowdfunding: an introduction

Parhankangas, Annaleena; Mason, Colin; Landström, Hans

doi:10.4337/9781788117210.00005

Cited by 11 publications

(6 citation statements)

References 47 publications

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“…In the first category of models, supporters provide financial support without counting on receiving anything in return. This paradigm supports philanthropic endeavors that benefit the public good (Parhankangas et al, 2019). Justgiving and GoFundMe are two examples of sites that often follow this paradigm.…”

Section: Modeling Techniques Of Crowd Fundingmentioning

confidence: 84%

Crowdfunding: A New Approach to Entrepreneurship's Startup Phase

2022

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Investors may support new commercial, cultural, or social enterprises in exchange for future commodities and activities. Crowdfunding is an essential part of project finance right now. Many people are intrigued about how crowdfunding works and how it may help start new businesses. Still, there is a lack of understanding and expertise on how crowdsourcing works and how it may assist these new initiatives to be successful. The most challenging task is obtaining financial support before establishing an entrepreneurial or creative venture. If the developer lacks links to venture capitalists or banks and a solid financial track record or commitment, they may have trouble getting project funding. This article explains crowdsourcing, a new kind of finance for company owners and project creators. According to this survey, the industry is not mainly established. Instead, it outlines CF's qualities and critical players. Crowdfunding enables a creative or patronage concept to be realized by collecting finances from many people online. Crowdfunding may be the answer for businesses or creatives that need resources. Research has uncovered many crowdsourcing business concepts and finance sources. We used empirical data to evaluate how it would assist capital deficit units and the strategy's merits and downsides from the founders, funders, and platform perspectives.

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Section: Modeling Techniques Of Crowd Fundingmentioning

confidence: 84%

Crowdfunding: A New Approach to Entrepreneurship's Startup Phase

2022

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“…Over the past decade, crowdfunding has established itself as a prominent alternative avenue to raise funds across various domains such as education, start-ups and the arts (Ishak and Rahman, 2021). Capitalising on the internet’s far-reaching influence, crowdfunding connects many funders and investors to accumulate funds for venture capital, social enterprises and community-based projects (Aderemi et al , 2021; Landström et al , 2019). Modern crowdfunding is practised as an online fundraising concept that links two groups: those who have additional funds and those who have ideas but are limited in terms of funds to realise the ideas.…”

Section: Literature Reviewmentioning

confidence: 99%

The applicability of Islamic crowdfunding as an alternative funding for micro-entrepreneurs in Malaysia

Ishak,

Mohammad Nasir

2023

QRFM

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Purpose The purpose of this study is to analyse potential models of Islamic crowdfunding as an alternative financing option for micro-entrepreneurs in Malaysia. While crowdfunding has gained traction as an alternative funding source for businesses, it is unclear how far this concept can benefit a group of micro-entrepreneurs in Malaysia. Design/methodology/approach This study uses a qualitative research approach by using data collected through semi-structured interviews with several experts and practitioners in crowdfunding, Shariah and entrepreneurship. Prior to discussing the facets of the findings, the data were analysed based on a thematic approach. Findings The findings reveal that while previous works of related literature suggest crowdfunding as a viable alternative financing option for entrepreneurs and their businesses, in reality, its practical implementation presents challenges. Numerous micro-entrepreneurs need more training in the areas of management and marketing. Such concerns raise questions about their ability to attract potential project backers. With the proper selection of Shariah contracts and several approaches to risk management, Islamic crowdfunding can potentially become an alternative funding source for microbusinesses. Research limitations/implications Given the exploratory nature of this study regarding the applicability of Islamic crowdfunding as an alternative fund for micro-entrepreneurs, its findings may not fully encompass Malaysia’s context because of the limited number of participants involved. Practical implications The findings of this study offer guidelines on how to implement Islamic crowdfunding for micro-entrepreneurs. Consequently, Islamic crowdfunding has the potential to alleviate the government’s burden of providing funds for micro-enterprises and enhance their skills and mentality to be more independent, creative and able to promote their products. Social implications While Islamic crowdfunding can be an alternative opportunity for business enterprises and community-based projects, it promotes the spirit of cooperation and collaboration within society. Originality/value Although Islamic crowdfunding is a topic that has been discussed previously, empirical investigations in this area remain scarce, mainly through qualitative approaches. Distinguishing from prior literature, this study analyses several potential models of Islamic crowdfunding from the perspectives of experts, practitioners and related agencies for micro-entrepreneurs. Moreover, this study bridges insights from related literature so that they offer practical applications to support micro-entrepreneurs in Malaysia.

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“…Here, backers provide funding based on charitable or civic motivations without expecting any repayment, to support disaster relief, famine, health and other charity-related issues. This model facilitates private contributions to public goods, ranging from the renovation of a public square in a neighborhood to the maintenance of schools (Parhankangas et al;2019).…”

Section: The Donation-based Crowdfunding Approachmentioning

confidence: 99%

Untitled

2022

BJMS

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Crowdfunding has developed from being just a fundraising tool to a versatile marketing tool. Raising funds through crowdfunding has become a vital tool for start-up companies and most recently in the Microfinance banks to obtain investments they otherwise might not receive from more traditional sources such as banks, angel investors and stock markets. This adoption of crowdfunding for marketing purposes is not without its problems. Organizations would be well advised to consider not only the opportunities these platforms provide, but also their limitations, risks and the best crowdfunding platforms that will fit into their marketing objectives. In this regard, this study was carried out in order to assess the relationship between crowdfunding and marketing performance of microfinance banks in Akwa Ibom State. The researcher adopted a survey research technique in the study. The population size 16 microfinance banks within Uyo metropolis of Akwa Ibom State and a sample size of 366 employees was studied. The crowdfunding variables (independent variables) considered in the study were Equity-based Crowdfunding, Reward-based Crowdfunding and Lending-based Crowdfunding. The dependent variable was Marketing Performance. The hypotheses stated were tested using Spearman Correlation Coefficient at a 5% level of significance. From the data analysis, the major findings revealed a positive and significant relationship between Equity-based Crowdfunding and marketing performance of microfinance banks in Akwa Ibom State, (R = 0.770; P<0.05). The study revealed Reward-based Crowdfunding has having a positive and significant relationship on marketing performance of microfinance banks in Akwa Ibom State, (R = 0.855; P<0.05). The study also revealed that there is a positive and significant relationship between Lending-based Crowdfunding and marketing performance of microfinance banks in Akwa Ibom State, (R = 0.805; P<0.05). From the findings, it was concluded that there was a positive and significant relationship between Crowdfunding and marketing performance of microfinance banks in Akwa Ibom State. In line with this, it was recommended that companies, start-up businesses and financial institutions should adopt various crowdfunding platforms in their businesses as one of the means of raising finance for the company in order to boost their marketing performance.

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Crowdfunding: an introduction

Cited by 11 publications

References 47 publications

Crowdfunding: A New Approach to Entrepreneurship's Startup Phase

Crowdfunding: A New Approach to Entrepreneurship's Startup Phase

The applicability of Islamic crowdfunding as an alternative funding for micro-entrepreneurs in Malaysia

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