Crowdfunding brought together more than $2.5 billion in capital across Europe last year, of which nearly $2 billion was raised in the UK. The UK raises funds well above levels seen in Europe – bringing in an average of €29.73 per person, compared to the European average (excluding the UK) of €1.
The financing of startups and projects through the ‘crowd’ has in recent years become a popular way of providing access to capital for businesses and organisations. More and more businesses are asking for crowdfunding, not merely to receive capital but also to test whether their product idea has merit and demand before it is scaled. According to recent data from Massolution* crowdfunding platforms will distribute nearly €30 billion globally this year – more than doubling since last year’s €14.5 billion and growing from barely €1 billion in 2011.
North America is by far the biggest region, collecting €7.3 billion in 2014, followed by Asia at €2.6 billion. Oceania crowdfunded a mere drop in the ocean at €35 million, while African nations collectively collected around €10 million. European projects and initiatives sourced €2.5 billion from crowdfunding platforms, with the UK collecting the overlarge chunk of the funding at around €1.9 billion. In France €152 million was financed this way, while in Germany the crowdfunding market totalled €139 million and in the Netherlands €63 million. In terms of on average per person giving, the UK is well out on top with €29.73 per person, followed by the Netherlands €3.75. The average across Europe (not including the UK) stands at a mere €1.
Looking further ahead, according to a World Bank commissioned report, the global crowdfunding market is predicted to grow to between $90 billion and $95 billion by 2025.
The total alternative financial market in Europe, of which crowdfunding is but one part, totalled $3 billion in 2014 according to an EY and the University of Cambridge report. Two years earlier, in 2012, the alternative finance market was worth a mere €500.
* The research by Massolution was performed in partnership with several European parties, including Douw&Koren, Asociación Española de Crowdfunding, Financement Participatif France, German Crowdfunding Network and the University of Cambridge.