1. Crowdfunding in
Biotech: problems and
possibilities
CLAIRE INGRAM, STOCKHOLM SCHOOL OF ECONOMICS
ROBIN TEIGLAND, STOCKHOLM SCHOOL OF ECONOMICS
2. Crowdfunding in Sweden
Dr. Robin Teigland
Associate Professor
Stockholm School of Economics
robin.teigland@hhs.se
@robinteigland
Claire Ingram
PhD Student
Stockholm School of Economics
claire.ingram@hhs.se
@Claire_EBI
3. A true story
That made
2 million GBP for
cancer research
at Uppsala university
4. What is crowdfunding?
Accumulation of small investments in individual projects by large
number of individuals (the “crowd”) via or with help of Internet and
social networks (De Buysere et al., 2012)
6. Form of Funding
Benefits for Funders
Donation-based
Donation
Intangible benefits.
Reward-based
Donation or prepurchase
Equity-based
Investment
Debt-based
Loan
Rewards in addition to intangible
benefits.
Return on investment if company
does well. Rewards sometimes also
offered and intangible benefits may
motivate too.
Repayment of loan with interest.
Alternatively intangible benefits if
loan given interest-free.
Ingram & Teigland, 2013
7. Stockholm success story: Flippin‟ Burgers
Money raised:
SEK 36,502 /
€4,000
Number of
investors: 186
Date funded:
September 2011
Sector: Food
9. Who are the funders?
Educated experts?
85 % of respondents have university degree (vs 16% of women and 22% of men in
general population, 2013)
42% had knowledge in same field as project they funded
49 % reported to have been better at judging project quality due to previous experience
The “in-crowd”
47 % of “the crowd” classified themselves as entrepreneurs – compared to only 7 % of
Swedish population (2012)
77 % never bought shares in unlisted company before
41 % risk lovers
Skoglund & Stiernblad 2013
12. Equity crowdfunding in Sweden
No EU/EEA country can require a prospectus to be
prepared for rounds of less than 100 000 EUR
For rounds of 5 million euros or more, an EU prospectus is
always required
In Sweden the limit is 2.5 million EUR
Less than 150 „non-qualified‟ investors without a
prospectus
13. Benefits of Crowdfunding
Screening device for investors
Reach investors further afield
Reach people with money who don‟t have the right
“connections”
BUT in Equity crowdfunding: Lots of small investors – a
problem?
Ingram & Teigland, 2013
14. Requirements to succeed?
Choose the right platform – and crowdfunding type – for your
project (keep in mind platform fees)
Make the concept easily understood
Make it personal?
Ensure that you have initial critical mass (social media,
newspapers) – NB in donation- and reward-based
Feed the crowd
Keep followers up to date
Neuro-endocrine cancer (NET)virus that destroys this cancer in lab experiments – here in Uppsala – not a cure, but a treatmentSwedish government funding andSwedish Cancer Society funding. The grants cover the research to develop viruses for therapy but they are not big enough to run clinical trials with an advanced medicinal product where special rules apply (viruses falls under this category in Europe).The Swedish research team placed much of their research in to the public domain- no patents
Snabbutveckling, 600% på 3 årMassolution: Four established types of crowdfunding exist: donation-based, reward-based, equity-based, and lending or debt-based. In May 2013, there were around 800 crowdfunding platforms worldwide, and crowdfunding initiatives raised an estimated 2.6 billion USD in 2012, including about 945 million USD in Europe through 470 000 campaigns. Furthermore, Massolution predicts that in 2013 crowdfunding will reach volumes of 5.1 billion USD worldwide, with about 1.3 billion USD in European markets. To date, business and entrepreneurial activity comprises 16.9% of all crowdfunding activity while Information and Communication Technology projects comprise a mere 4.8% of activity.
85 % of respondents have university degree (vs 16% of women and 22% of men42% had knowledge in same field 49 % reported previous experience47 % of “the crowd” classified themselves as entrepreneurs – compared to only 7 % of Swedish population (2012)41 % risk loversWho are Sweden’s crowdfunders (Skoglund & Stiernblad 2013). The survey was sent out by email to 2931 traditionalcrowdfunders (ie not equity) who visited FundedByMe between June 2012 and March 2013 to fund projects. 390 completed the survey - response rate was 13.3 %. The majority of the survey respondents were males with an average age of 38 years.
49%: “because I liked the project and I wanted to support the idea”25%: “because I like, know or have heard of the project initiator”
Foldit - Comp Sci at University of Washington in Seattle, researcher in Seattle - use the cursor fold the proteininto its optimum shape. The only rules are based on physics—opposite charges attract, atomic bonds have limited angles of rotation, and the parts of the molecule that stick to water tend to point outward. The closer your model's properties adhere to those rules, the more points you get. Brainflight – Max Planck Institute - map the way brains are wired up.