Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Crowdfunding SSE Alumni Seminar Teigland & ingram


Published on

Presentation from SSE Alumni Seminar in Dec 2013. Video can be viewed here:

Published in: Business, Economy & Finance
  • Be the first to comment

Crowdfunding SSE Alumni Seminar Teigland & ingram

  2. 2. Crowdfunding in Sweden Dr. Robin Teigland Associate Professor Stockholm School of Economics @robinteigland Claire Ingram PhD Student Stockholm School of Economics @Claire_EBI
  3. 3. Today’s presentation What is crowdfunding? From crowdfunding to crowd equity Why crowdfund? Trends in crowdfunding Q&A
  4. 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) Picture: FundedByMe
  5. 5. Local Stockholm success story: Flippin’ Burgers Money raised: SEK 36,502 / €4,000 Number of investors: 186 Date funded: September 2011 Sector: Food
  6. 6. Enabling local, small-scale solutions
  7. 7. Crowdfunding 2012 Est. 5.5 mln (Oct 2013) Massolution 2013 Worldwide $2.7 bln 470k projects 800+ platforms
  8. 8. Four forms of crowdfunding Form of funding Donationbased Benefits for funders Donation Intangible benefits. Donation or preReward-based purchase Equity-based Investment Debt-based Loan Ingram & Teigland 2013 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.
  9. 9. Investment Role and Type Angel Investors Soft Loans Venture Capitalists Investment Value 2012 Invest large amounts, make few investments, take equity share. 3.3-3.9 billion SEK p.a. (approximation based on 2008 data) State loans at high interest rates that can be written off if enterprise 2.4 billion SEK p.a. (ALMI alone) dissolution. Invest large amounts, make few investments, take equity share. Donation, pre-purchase/reward, or Crowdfunding equity, depending on platform and entrepreneur’s preferences. Ingram & Teigland 2013 1.8 billion SEK p.a. (2010 data) Estimated 37 million SEK p.a.
  10. 10. Crowd equity raising its head… Millions of dollars • Politicians generally positive -> entrepreneurs + job creation • But regulation is lagging in most countries • US, Italy, Denmark changing regulations enabling equity Massolution 2013
  11. 11.
  12. 12. Increasing focus on Crowd Equity in Sweden Sweden 2011 UK 2010 Finland 2011 Equity: 27,8 mln SEK To Sweden 2013 To Sweden 2013 Reward: 6,8 mln SEK Equity only Equity only
  13. 13. Why crowdfund? Test the market/Proof of concept “Evangelists” / Ambassadors Marketing & publicity (int’l platforms, mostly) Raise funds faster Faster time to market Money
  14. 14. “It’s not just about the money.” 685 people talking about product on social media Australia’s “Major Disaster Department” World’s largest telecom
  15. 15. International expansion
  16. 16. Requirements to succeed? What do you give in return (thank you, reward, pre-purchase, shares)? Choose the right platform for you Make concept easily understood Ensure initial critical mass Bring the crowd I have a dream! And “The crowd needs fuel!”
  17. 17. But there are potential downsides Project(s) may not be understood by crowd Not significant amounts of money • • More about publicity But changing with crowd equity Other skills/resources do not seem to be forthcoming
  18. 18. Trends in Crowdfunding Niche Community Hybrid platforms Enterprise sponsored Internal corporate crowdfunding LIVE! Economic development Celebrities
  19. 19. Crowdfunding for research
  20. 20. Strategic partnership +
  21. 21. Celebrities entering the scene Donald Trump’s crowdfunding site Open to anyone Executive Producer Robert Redford Narrated by Jodie Foster
  22. 22. Internal corporate crowdfunding iFundIT More than 300 participants Entry-level workers to VPs Given $2,000 to invest over 8 week period Choose internal projects in which to invest
  23. 23. Enabling entrepreneurs anywhere Ushahidi of Kenya Kenya
  24. 24. “Made in Africa” 3D printer (Togo) through Ulele Winner of International Space Apps Challenge
  25. 25. But many unanswered questions Cross border investments? Secondary markets for crowd equity shares? Taxation issues for investor and entrepreneur? Lack of support and strategic advice for both investors and entrepreneurs? How to better leverage “crowd” for resources?
  26. 26. Venture capitalists are the travel agents of yesterday – here today, gone tomorrow. Venture capitalist in Silicon Valley – June 2013
  27. 27.
  28. 28. Thank you! Questions ? Image via
  29. 29. If you love knowledge, set it free… Photo: Lindholm, Metro Photo: Nordenskiöld Robin Teigland RobinTeigland För mer information: •Research article: •Industry report: