Crowdfunding is a rapidly growing industry. In 2010, the global online crowdfunding market was valued at roughly $880 million, led by a relatively small audience of early adopters. Just four years later, crowdfunding platforms accounted for approximately $16 billion in total investments, and that figure is expected to exceed $34 billion by the end of this year. To better illustrate the scale of this growth, consider the venture capitalism industry, which has traditionally served as the ‘go-to’ source of capital for startups and other pre-revenue companies.
Currently, the VC industry invests an average of $30 billion each year, led by global firms such as Fortress Investment Group (NYSE: FIG), American Capital (NASDAQ: ACAS) and Apollo Investment Corp. (NASDAQ: AINV), but industry growth is expected to remain relatively flat in the coming years. In other words, the crowdfunding industry is on track to account for more funding than the VC industry as early as next year.
One of the primary benefits of crowdfunding is its versatility. Companies such as Kickstarter and GoFundMe have captured market share through the implementation of a simple rewards-based system. Using this model, investors gain access to varying levels of rewards corresponding to the amount they pledge to the business or project. However, the Jumpstart Our Business Startups (JOBS) Act – which was signed into law by President Obama in April 2012 – set the stage for a crowdfunding model based on a more traditional investment incentive: equity.
Equity crowdfunding is just one of the many investment models offered by Symbid Corporation (OTCQB: SBID) through its proprietary investment platform, The Funding Network™. Founded in 2011, Symbid was one of the first companies to identify the rising need for data-driven SME finance and invest in the development of advanced investing, monitoring and data tools. Leveraging this early mover advantage, Symbid launched The Funding Network in March 2015 in order to give entrepreneurs direct access to all forms of financing while offering investors complete transparency on the potential risks and returns of their portfolios.
In the third quarter of 2015, Symbid demonstrated the marketability of its platform by recording a 30 percent year-over-year increase in total revenues. In its first six months of operation, The Funding Network has seen a total transactional volume of nearly $400 million. In July, Symbid successfully added roughly 2,000 new investors to its crowdfunding community and recorded its first success fees stemming from the introduction of its innovative loan crowdfunding product, effectively paving the way for additional growth in the months to come.
“The diversified product portfolio of The Funding Network has delivered promising results in the first six months since its launch in March and is creating real value for investors and entrepreneurs,” Korstiaan Zandvliet, co-founder and chief executive officer of Symbid, stated in a news release. “Clearly there is huge potential to further commercialize our transaction volume. The consistent growth in revenue we’ve been seeing in 2015 gives us the foundation to do just that while we continue to innovate at the forefront of online funding.”
For more information, visit www.symbid.com
