Improving the Role of Equity Crowdfunding in Europe's Capital Markets

Wilson, Karen E.; Testoni, Marco

doi:10.2139/ssrn.2502280

Cited by 72 publications

(73 citation statements)

References 9 publications

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“…They are: (1) there have to be a business project, which necessitates funding; (2) there have to be several investors and those investors want to assist to carry out of that project; and (3) the internet will connect investors and entrepreneurs (Bottiglia & Pichler, 2016). Based on the works of Moritz and Block, (2016); Hagedorn and Pinkwart, (2016); Wardrop et al (2015); Bellefl amme and Lambert (2014); Dix and Luzar, (2014); Wilson and Testoni, (2014); Pierrakis and Collins, (2013); Harrison and Mason (1992);De Buysere et al (2012);and Hemer (2011) the dimensions of crowdfunding are donation, sponsoring, pre-selling, social-lending, and equity-crowdfunding. Donation indicates individuals will allocate money to a business project or an innovative idea to carry out of that business project or idea as well as not to anticipate whatsoever in conversion of that allocated fund.…”

Section: Crowdfundingmentioning

confidence: 99%

Ramification of crowdfunding on Bangladeshi entrepreneur’s self-efficacy

Hoque¹,

Awang²,

Muda³

et al. 2018

10.5267/j.ac

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The novel funding sources turn out to be important for the Small and Medium Enterprises (SMEs) sector all over the world especially after 2007-2008 world financial crisis. Thus, to develop a new business idea and start-ups, SMEs need a sufficient amount of capital. However, after the financial crisis in 2008, SME sector faced the challenges of attracting new capital. Therefore, an innovative method of fundraising for SME was introduced as crowdfunding. Crowdfunding indicates financing a project or an idea via the internet owing the help from the many investors or donors of a society. Since there are limited works about the influence of Crowdfunding on Entrepreneur Self-efficacy (ESE), hence, to minimize the research gap and to achieve the objective of the study, we conduct a quantitative research among 190 entrepreneurs in Bangladesh using crowdfunding based on Social Cognitive theory. The data were analyzed using Structural Equation Modeling (SEM) in IBM-SPSS-Amos 25.0 and the stated hypotheses were tested. The study found a direct and positive effect of Crowdfunding on Entrepreneur's Self-efficacy (β=0.924, P=.001). Overall, the result has landed support for crowdfunding, which indicates that it can influence on self-efficacy of entrepreneur. In order to determine the need of crowdfunding, we have explained and statistically demonstrated how crowdfunding can provide a supplementary channel where firms can gain finance and to create self-efficacy of entrepreneurs through exploiting the potential of internet..

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Section: Crowdfundingmentioning

confidence: 99%

Ramification of crowdfunding on Bangladeshi entrepreneur’s self-efficacy

Hoque¹,

Awang²,

Muda³

et al. 2018

10.5267/j.ac

View full text Add to dashboard Cite

show abstract

“…This literature review focuses on equity-based crowdfunding, which needs to be differentiated from donation, reward, and lending-based crowdfunding (Wilson & Testoni, 2014). Equity crowdfunding shares the same characteristic as all crowdfunding business models where a large number of investors contribute relatively small amounts of money to finance a project (Vulkan, Å stebro, & Sierra, 2016).…”

Section: Equity Crowdfunding and Crowdinvestingmentioning

confidence: 99%

“…Equity crowdfunding shares the same characteristic as all crowdfunding business models where a large number of investors contribute relatively small amounts of money to finance a project (Vulkan, Å stebro, & Sierra, 2016). Equity crowdfunding is also called crowdinvesting, because investors receive the shares of a startup firm or of a convertible bond in return for their investment (Wilson & Testoni, 2014). Equity crowdfunding is an innovative solution to give startups and founders better access to investors and investments (Fatoki, 2014).…”

Section: Equity Crowdfunding and Crowdinvestingmentioning

confidence: 99%

Funding Innovations for Sustainable Growth in Emerging Markets

Neubert¹

2019

IJEF

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This study aims to understand the impact of fundraising innovations on sustainable growth in emerging markets. It opted for a multiple-case study research design using different sources of evidence, including nineteen semi-structured interviews. The subject matter experts (SMEs) were selected using a purposive selection method. The theoretical framework of Porter and Kramer is used. The results suggest that crowdinvesting, initial coin offerings, and accelerators might facilitate sustainable growth of private equity and venture capital markets in Africa due to entrepreneurial ecosystems and networks. The findings are relevant for founders and investors. The study contributes to the literature on entrepreneurial finance in emerging markets.

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“…Equity crowdfunding is an alternative funding source for smaller companies and for those in the seed as well as start-up stage (Wilson & Testoni, 2014;Deffains-Crapsky & Sudolska, 2014). Venture capital and private equity funds are not adequately fulfilling their role in backing companies in their early development stages, which makes it difficult for companies wishing to implement their business ideas to enter and be active in the market.…”

Section: Features Of Financial Return Crowdfunding Platformsmentioning

confidence: 99%

Crowdfunding as an alternative tool for financing small and medium-sized businesses

Panova¹,

Mul'ti-Plast²

2018

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-2 -Research topics include theory, regulation and supervision of financial systems, economics of insurance, banking and risk management, crowdfunding. AbstractCrowdfunding is a relatively new phenomenon. However, its growth rate in recent years has been substantial. Typically, start-ups and small and medium enterprises (SMEs) face funding problems and crowdfunding may have become an alternative funding source. We study a sample of financial return crowdfunding platforms active in the European Union. We concentrate on the organizational structure and business model of the platforms for those companies with funding needs to identify whether crowdfunding might be complementary to, or a substitute for traditional funding sources. The analysis evidences an extreme heterogeneity among platforms, partly due to the lack of regulation at both national and European level. Furthermore, it shows that crowdfunding has evolved from pure p2p to p2b and b2b fundraising, even in equity crowdfunding where target companies are mainly represented by start-ups. Also, some characteristics of p2p lending and equity platforms are significant for the future development of crowdfunding as an alternative source of capital. Another critical issue which may impact upon the future development of crowdfunding is regulation. Crowdfunding is largely still an unregulated activity. The ways in which crowdfunding is regulated will seriously affect its capacity to reduce the funding gap for start-ups and SMEs.

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Improving the Role of Equity Crowdfunding in Europe's Capital Markets

Cited by 72 publications

References 9 publications

Ramification of crowdfunding on Bangladeshi entrepreneur’s self-efficacy

Ramification of crowdfunding on Bangladeshi entrepreneur’s self-efficacy

Funding Innovations for Sustainable Growth in Emerging Markets

Crowdfunding as an alternative tool for financing small and medium-sized businesses

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