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Support services to foster the crowdfunding environment in Europe focused on web entrepreneurs

Startup Europe Crowdfunding Network

Final Report

Brussels, 19 April 2014

Deliverable 4: Final report for the Service Contract with the European

Commission, contract number: 30-CE-0557296/00-95

Prior deliverables:

Deliverable 1: Detailed Road Map

Deliverable 2: Interim report

Deliverable 3: Web Portal and Online Consultation

The Startup Europe Crowdfunding Network for Webentreprneurs has been managed on behalf of the

European Commission by WEBclusive BV, the Netherlands, and Fanshaw & Fothergill SCS, Belgium,

with support of the European Crowdfunding Network AISBL, Belgium.

The project website is located at www.crowdfundingnetwork.eu

The contracting parties WEBclusive BV and Fanshaw & Fothergill SCS will be handing over all work

done for future development to the European Crowdfunding Network ASBL as outlined in the

European Commission service contract number: 30-CE-0557296/00-95 with the end of the contract.

European Crowdfunding Network AISBL

Registered offices: Av d’Hinnisdael 6 bt 4, B-1150 Woluwé St Pierre, Belgium

http://www.crowdfundingnetwork.eu/



Contents

1. Executive Summary ........................................................................................................................................ 3 2. A summary description of project context and objectives ............................................................................. 5

2.1. Project Context ...................................................................................................................................... 5 2.2. Project Objectives .................................................................................................................................. 6

3. Research analysis and online consultation ..................................................................................................... 7 3.1. Conclusions ............................................................................................................................................ 7

3.1.1. Web entrepreneurs ...................................................................................................................... 7 3.1.2. Crowdfunding platforms ............................................................................................................... 8 3.1.3. European Commission .................................................................................................................. 8

3.2. Desk research ........................................................................................................................................ 9 3.2.1. Crowdfunding Platforms Focussing on Web and Internet Businesses ......................................... 9 3.2.2. Crowdfunding Model of Web Focused Platforms ....................................................................... 10 3.2.3. Country Focus ............................................................................................................................. 10 3.2.4. Platform Language ...................................................................................................................... 11 3.2.5. Average Amount Raised by Web Entrepreneurs ........................................................................ 11 3.2.6. Geographical Distribution of ‘Successful Crowdfunding Campaigns .......................................... 12 3.2.7. Type of Crowdfunding Used ....................................................................................................... 12 3.2.8. Average Number of Backers/Investors ....................................................................................... 13 3.2.9. Projects Exceeding the Campaign’s Goal .................................................................................... 14

3.3. Online consultation ............................................................................................................................. 15 3.3.1. Reasons to use crowdfunding ..................................................................................................... 15 3.3.2. Platform Choice .......................................................................................................................... 16 3.3.3. Planned Target Budget ............................................................................................................... 17 3.3.4. Successful campaigns .................................................................................................................. 17 3.3.5. Willingness to re-use crowdfunding ........................................................................................... 18 3.3.6. Reasons for not having used crowdfunding yet.......................................................................... 19 3.3.7. How to stimulate crowdfunding in Europe ................................................................................. 19 3.3.8. Quality label for crowdfunding platforms: entrepreneurs ......................................................... 20 3.3.9. Quality label for crowdfunding platforms : platforms ................................................................ 21 3.3.10. Quality label for crowdfunding platforms: content .................................................................... 21 3.3.11. European Commission’s role in promoting crowdfunding ......................................................... 22

3.4. Additional online consultation: Common Issues for Crowdfunding Platforms ................................... 23 4. A proposal for taxonomy and for data collection......................................................................................... 25

4.1. Taxonomy ............................................................................................................................................ 25 4.2. Framework for Data collection ............................................................................................................ 25

5. APPENDIX ..................................................................................................................................................... 28 5.1. Research analysis and online consultation Desk Research .................................................................. 28 5.2. The potential impact from the main dissemination activities and exploitation of results .................. 28

5.2.1. High-level Workshop on Crowdfunding and Web-entrepreneurship ......................................... 29 5.2.2. Web-portal .................................................................................................................................. 31 5.2.3. Other aspects explored regarding the portal ............................................................................. 37

5.3. Data Collection .................................................................................................................................... 38 5.3.1. An Economic model for Data collection and publication ............................................................ 38 5.3.2. Open Call for Technology Providers ............................................................................................ 49

5.4. Taxonomy ............................................................................................................................................ 55 5.4.1. Scope & Definitions ..................................................................................................................... 56 5.4.2. Context & Usage ......................................................................................................................... 56 5.4.3. Artefacts analysis ........................................................................................................................ 58 5.4.4. Data Groups ................................................................................................................................ 64



1. Executive Summary Networking European crowdfunding platforms around a common understanding of the industry is

vital. Only with a crowdfunding environment that is marked by professionalism, transparency and

coherent practices, it can be expected that potential crowd funders and web entrepreneurs will

regard investment opportunities and access to finance through crowdfunding as a viable solution for

their needs. The education of both, the crowdfunding platforms as well as funders and entrepreneurs

was therefore a key part of the Startup Europe Crowdfunding.

The project has reached out to a large number of stakeholders through different means. Starting

with a dedicated workshop, engaging some 70 people, we communicated the results to some 1,200

people directly plus spill over effect. The workshop results were strong recommendations with

regard of data gathering and best practices for crowdfunding platforms with regard to transparency.

Details of this were presented in deliverable 2, and have been the basis for further work presented in

this report with regard to taxonomies and data collection. Following the workshop, we build a web

portal with public information for web entrepreneurs with key introductions to crowdfunding and

how to approach it. We also gathered a number of case studies to allow web entrepreneurs to better

understand potential success factors.

In our research, both desk research and online consultation, we focused on identifying specific issues

for web entrepreneurs with regard to crowdfunding in Europe. Our desk research identified 230

crowdfunding platforms (we understand that this must be indicative in a fluctuating market and due

to language barriers) of which some 13% (or around 30 platforms) have a focus on web

entrepreneurship or similar activities, with France, Italy and Germany representing the largest share

of the latter. The majority of all reviewed crowdfunding platforms offered a mixed approach of

funding models (a hybrid of either two of the following reward and equity and debt). Reward based

platforms were the largest single group with 19%, and we did not identify any donation based

platform with a focus on web entrepreneurs. Some 68% of crowdfunding platforms had a multi

country approach. Reward based crowdfunding platforms operating in multiple countries used to

55% two or more languages. We see a clear trend toward cross border operation within web

entrepreneurship focused crowdfunding platforms, mostly reward but increasingly also equity.

The average fund raising for web entrepreneurs is around €12,500 for reward and €113,000 for

equity, which is line with expectations. The largest number of successful crowdfunding campaigns by

web entrepreneurs were realised in Germany (24%), followed by Spain (17%) and France (16%). In

total, 72% of web entrepreneurs’ campaigns that were successfully funded exceeded the funding

goal. In our online consultation, we found that the reasons for web entrepreneurs to use

crowdfunding are easy access to money (71.4% of respondents) followed by the

difficulty/impossibility of obtaining funds from traditional financial actors, such as banks and

professional investors, positioning crowdfunding as an alternative source of finance, the marketing

“side benefit” of crowdfunding and the association with an innovative form of funding and

communicating (all 57.1% of respondents). Some 30% of respondents did not use existing

crowdfunding campaigns for their crowdfunding, but opted for a do it yourself or alternative model.



Some 50% choose a crowdfunding platforms due to its legal structure and none of the respondents

choose a crowdfunding platform because of prior success storied, links to government institutions or

other business partners or indeed, transparency. Of the surveyed web entrepreneurs, none was

seeking amounts higher than €250,000, but two thirds managed to run successful crowdfunding

campaigns and 86% of respondents are expecting to use crowdfunding again in the next five years.

Asking those respondents that had not used crowdfunding so far, what kept them from it, showed

that 28% indicated they did not know what crowdfunding platform to choose as the main reason for

avoiding this financing form so far other than having sufficient funding already (32%).

When asking about how to foster crowdfunding in the EU, respondents that public data to prove that

crowdfunding is a viable alternative source of finance would the main issue. Respondents also

believed it is important to spread the knowledge about crowdfunding among (web) entrepreneurs

and investors as well as promoting best practices. While a quality label as such did not rank high (it

could be argued that if it would rate the above issues, it would) separate questions clarified that

most of the respondents (32%) believe that a quality label should be supported by the European

Commission. Also, all respondents expressed a positive opinion with regards to a quality label for

crowdfunding. Asking specifically about the role of the European Commission, 61.5% of respondents

would be in favour of the EC creating a legal framework of crowdfunding in Europe. Other activities

that respondents deemed important for the EC to undertake in order to stimulate the crowdfunding

market are: organizing workshops and trainings to explain web entrepreneurs how crowdfunding

works (50%), potentially within ongoing access to finance and investor readiness activities and to

support a quality label for crowdfunding platforms (46.2%).

In order to deliver data on the European crowdfunding market, we developed both, taxonomy and

data collection framework. While we worked with existing market players to develop the taxonomy

discussion from the workshop findings further, we linked the discussion also to the data collection

framework. The European Crowdfunding Network AISBL has initiated a Technical & Accounting

standards work group that is hoped to carry the work started within this project further into market

implementation.

With regard to the data collection, we have identified hurdles in defining a roadmap for

implementing a data collection & data distribution system. The main challenges for the framework

on data collection and data publication are that data models are heterogeneous across data

crowdfunding platforms and that their systems do not always enable data collection. Indeed, to

technically enable platforms to provide data (in the required format) may carry significant costs to

the contributing platforms (both for set-up and for operations). Those that do contribute also may

wish to impose restrictions and conditions to the commercial use of their data. In addition, the scope

of required data has to be thoroughly defined for each type of funding (e.g. reward based, equity,

debt crowdfunding ...) and is subject to significant operational costs for the data collecting agency,

including maintenance of security control and access rules. We see the only solution for enabling

exhaustive, comparable and accurate data collection is to define common data standards and models

as well as to provide an eco-system that is incentivizing the data remittance in a correct format and

in timely manner



2. A summary description of project context and objectives

2.1. Project Context Startup Europe is the European Commission action plan aimed at strengthening the business

environment for web and ICT entrepreneurs (WE) in Europe and contributing to innovation, growth

and jobs. In January 2013, the Commission adopted the Entrepreneurship 2020 Action Plan to

unleash Europe's entrepreneurial potential. Startup Europe is a Digital Agenda Europe (DAE) initiative

supported by Vice President Neelie Kroes promoting web and ICT entrepreneurs to start their

business in Europe and to let them flourish in Europe. The project is part of this activity and aims to

provide relevant input to the work of the European Commission.

As commercial banks, the main source of loans and credits for smaller firms, are increasingly

reluctant of providing money to SMEs and have tightened lending conditions, access to fresh capital

is more crucial for small businesses than ever. According to European Chambers of Commerce data,

some 30% of SMEs face liquidity problems, a quarter of which are due to denied credits by banks.

The European Investment Bank estimates that only 30% of SMEs access bank credit at any given

time, but that 40% use overdraft facilities, credit cards and other short term credit lines to smooth

income fluctuations. If the situation is bad for established firms, it is dramatic for start-ups or fast

growing companies. For these companies, the key issue is access to equity capital in order to become

credible bank borrowers with sufficient collateral.

The early stage venture capital market in Europe represented only around €3 billion in 2012 that has

been invested in around 3,000 SMEs. This represents around 0,02% of all SMEs in Europe. Business

angels added some 5,000 transactions at a similar value. At the same time, web entrepreneurs

operate often with very low cost ceilings, making use of cloud and SaaS technology offers. They

therefore frequently do not qualify for venture capital investment until they have grown revenues to

a sizable amount. For this initial growth phase and for small SMEs in general, crowdfunding can

provide access to small rounds of equity funding as well as revenue via pre-sales and reward-based

crowdfunding campaigns.

The inherent advantages of crowdfunding, including market validation, can on top help reduce

product development and marketing cost. Web entrepreneurs especially have an affinity to the

distribute nature of networks as represented by crowdfunding and they are usually also very familiar

with the relevant web tools used to promote crowdfunding campaigns.

Fostering the crowdfunding environment in Europe and specifically web entrepreneurs and start-ups

demands a dialogue between entrepreneurs, investors and platform operators enabling

crowdfunding. It is also vital to involve investors that are poised to take advantage of crowdfunding

by picking the most promising crowdfunded projects for follow-on investment. Crowdfunding can

therefore only be understood as part of the early-stage ecosystem, not as a standalone, one-solves-

all solution.



2.2. Project Objectives The European Commission’s "Web Entrepreneurship Action Plan" is targeted at strengthening the

environment for entrepreneurs who are starting and developing web businesses. The DAE is also

providing support for WE. One of the priorities of the action plan is to facilitate access to funding

opportunities for web startups. Within this priority, crowdfunding is a focal point. The objectives of

this project within the Startup Europe initiative and the "Web Entrepreneurship Action Plan" with

regard to web entrepreneurs were:

Acquiring additional data and knowledge about the current status of the web related crowdfunding sector in Europe (number and geographical distribution of crowdfunding platforms related to web businesses, number of web startups using crowd funding and related financial figures, possible issues and barriers affecting the growth of the sector, at national and EU level).

Based on the above, drawing some conclusions on the possible measures which would further strengthen the crowd funding environment and facilitate the pan-European growth of the sector.

Supporting higher visibility and accessibility of existing crowd funding opportunities for webentrepreneurs Europe wide.

Contributing to strengthening the links and networking between existing European crowdfunding platforms, as well as to foster the creation of new, web focused platforms.

Raising the level of education of funders and web entrepreneurs as regards investment opportunities and access to finance through crowdfunding.

The project aimed at helping reach the above objectives by engaging with relevant stakeholders

across Europe. Initially, a public workshop aimed at developing dedicated outputs for continuous

work within the project was held with around 70 participants in June 2013. Following the workshop a

dedicated web portal was built as an education and dissemination tool for issues around

crowdfunding for web entrepreneurs and other stakeholders, in particular:

General introduction to crowdfunding and the benefits and opportunities of crowdfunding

Links to crowdfunding platforms (for web entrepreneurs)

Rules governing the platforms

Educational information how to run a successful crowdfunding campaign

How to run a successful crowdfunding campaign

Which type of crowdfunding is best for specific businesses/projects

Information for funders how to choose a campaign

On top of the workshop and the web portal the project aimed at executing dedicated desk research

and an online consultation with the aim to A) raise awareness of web entrepreneurs and

stakeholders of crowdfunding and the work of the Startup Europe initiative around crowdfunding as

well as to gather information relevant for understanding the market expectations. These results are

outlined in this report. Further, the project aimed at developing a framework for a taxonomy for

crowdfunding web startups and a framework for data collection and near-real-time data publication.

The findings of this work are also presented in this report.



3. Research analysis and online consultation The research was split into two major aspects, desk research and online consultation. The desk

research was executed in two stages, a review of crowdfunding platforms across Europe1 and a

subsequent analysis of public data available on these platforms. We established the existence of 230

crowdfunding platforms, from which we can assume that the potential total number of crowdfunding

platforms may be larger, though the size of many of the missing platforms may also be very small.

Overall, the number of platforms does not indicate their sustainability (financially or operationally).

3.1. Conclusions The present research tried to frame if and how crowdfunding can be a viable source of funding for

web entrepreneurs in Europe and what could be done to encourage this. Three different

perspectives were adopted: web entrepreneurs’, crowdfunding platforms’ and the EC’s. Following

the main conclusions and remarks for each of the three actors:

3.1.1. Web entrepreneurs

The recent economic crisis in Europe has severely impacted on the possibility for web entrepreneurs

to access finance. In this context, crowdfunding can be a good alternative to traditional sources of

early stage capital, such as bank loans which are more and more difficult to get. Furthermore, this

new and innovative financing method brings along other non-financial benefits for web

entrepreneurs. In fact crowdfunding can also be used as a powerful marketing tool, allowing to test

the idea and to promote it to a “crowd” of people.

As emerged from the research, most of the web entrepreneurs who used crowdfunding to finance

their projects in Europe opted for reward-based campaigns. However, web entrepreneurs, on

average, raised more funds on equity-based portals. We do not think one form is more suitable to

web entrepreneurs than the other. We believe, though, that web entrepreneurs should evaluate

case by case, taking into account the following points:

● to use equity crowdfunding, a basic level of business planning and financial

forecasting skills is required;

● to use reward crowdfunding, there should be the possibility of creating rewards that

do not raise campaign’s costs too heavily.

1 We understand the limitations of such research due to language barriers and the dynamics of the sector and

believe that our results are indicative only. We are certain to have missed a number of new and smaller

crowdfunding platforms and will have not fully understood the markets in some countries due to language and

maybe also cultural barriers.



● Even though crowdfunding may appear an easy solution for raising money, because

of its transparency and direct link to investors, it still requires dedicated and hard work as

well as proactive efforts from the web entrepreneur’s side.

3.1.2. Crowdfunding platforms

Even if the number of crowdfunding platforms is probably growing every day more and more, the

platforms dedicated to web entrepreneurs in the EU form a niche. The great majority of those

platforms offer more than one crowdfunding model to its users and offer their website in two or

more languages. The latter fact indicates the willingness of these platforms to operate on a larger,

European scale. However, this is often limited by different national regulations and high compliance

costs.

Crowdfunding platforms which aim at web entrepreneurs should try to communicate in a clear and

objective way and through adapt channels about the advantages and support they offer to web

entrepreneurs. In fact, many web entrepreneurs indicated as a key reason for not using

crowdfunding the fact they did not know what platform to select.

3.1.3. European Commission

The European Commission can certainly play a crucial role to stimulate crowdfunding as a viable

source of finance for web entrepreneurs around Europe. As emerged by the present research, the EC

can take actions both to encourage web entrepreneurs to use crowdfunding and to help platforms to

establish at European level. In particular it could:

● Support the development of a transparent quality label for crowdfunding platforms that

would help, on the one hand, web entrepreneurs to select a crowdfunding portal and, on the

other, the best platforms to establish and grow. Within the communication on crowdfunding

published by the EC on the 27th of March this has been already indicated. This could be

focused on transparency or on best practices or both, but also on open technology or

reporting standards to be used.

● Provide training and knowledge about crowdfunding to web entrepreneurs. This could be

achieved, for example, by organizing seminars, webinars and sharing best practices for

running a crowdfunding campaign. Sharing data and information on crowdfunding in Europe

could also be an effective way not only to encourage web entrepreneurs to use

crowdfunding, but also to facilitate the creation of an atmosphere of trust towards this

financial innovation. Such activities could be organised on national level through relevant

partners under a European Commission led action.

● Foster the creation of a pan-European crowdfunding market. Regulations for crowdfunding

currently differ from country to country and in most of the European countries a specific

regulations is not in place yet. This makes it very expensive and time consuming for

crowdfunding platforms to start operating in their own country, but also to expand their

operations to other EU markets. As most crowdfunding platforms operate a low margin

business model aimed at reaching scale in order to obtain financial sustainability, this is a



vital factor in making the market competitive. The EC could shape crowdfunding in a similar

way as it is doing with the emerging social entrepreneurship sector

3.2. Desk research Our desk research laid bare a number of interesting facts, for example the percentage of

crowdfunding platforms in Europe which focus on web and internet business and the type of

crowdfunding they offer. We added additional debt to the research by using entrepreneur’s project

data published on crowdfunding platforms. Here we focused on web entrepreneurs that were

successfully crowdfunded (i.e. that reached or exceeded their target budget). The projects were

selected from a sample of crowdfunding platforms, formed by both equity and reward portals, which

either focused on web entrepreneurs or had a significant share of such projects on offer.

3.2.1. Crowdfunding Platforms Focussing on Web and Internet Businesses

The first chart below shows the percentage of European crowdfunding platforms which focuses on

Web and Internet businesses, while the second frames how these platforms are geographically

distributed (by country of incorporation).

Crowdfunding platforms which focus on internet and web businesses are a small niche (13%). There

is no country that predominates in this sector, however France, Germany and Italy display the

highest number of platforms dedicated to web entrepreneurs’ projects (17% each).



3.2.2. Crowdfunding Model of Web Focused Platforms

We analysed what crowdfunding models are offered by those crowdfunding platforms that focus on

web and internet businesses: Equity, Reward, P2P Lending, Donation or Combined (i.e. the platform

offers two or more models).

The largest category (59%) represents platforms that offer more than one crowdfunding model. This

may reflect a more general trend of horizontal scaling of crowdfunding platforms. On the other hand,

no web and internet focused portal was identified to be operating a donation-based model, which

may indicate that this model is not adapt for web entrepreneurs’ projects.

3.2.3. Country Focus

The chart below distinguishes between European platforms which focus only on one country and

those that instead focus on two or more countries.

The majority of platforms (68%) dedicated to web entrepreneurs has an international focus,

targeting two or more countries in the EU or in the world. Internationalization and cross-borders

operations are two of the most important topics in the European crowdfunding industry at the

moment, as many actors see in this an opportunity that could benefit the entire market (the survey’s

results reported further below confirm that respondents believe that an European legal framework

for crowdfunding would encourage the market’s growth).



3.2.4. Platform Language

The following graph distinguishes between the platforms which offer only one language and those

offering two or more languages. Once again, the majority of platforms in the sample offer their

services in two or more languages. This fact is in line with the results in the data discussed above and

indicates that most of the crowdfunding portals dedicated to web entrepreneurs have an

international focus.

3.2.5. Average Amount Raised by Web Entrepreneurs

The graph below shows the average amount which was raised by web entrepreneurs projects using

reward and equity crowdfunding.

The average amount raised by web entrepreneurs through equity crowdfunding portals is far higher

than the one raised through reward crowdfunding platforms. This result is in line with the general

trend that projects which raise money through equity crowdfunding collect higher sums than those

which use reward crowdfunding. However, it may also indicate that web entrepreneurs in need of

working capital will achieve better results with equity investment for the time being. The exceptional



examples of reward based crowdfunding campaigns, reaching millions of US Dollars, on US-based

crowdfunding campaigns for technology gadgets or web services, such as gaming, have not yet been

replicated by European crowdfunding platforms.

3.2.6. Geographical Distribution of ‘Successful Crowdfunding Campaigns

From the data collected it was also possible to determine how the projects in the sample are

geographically distributed among the different platforms. However, it should be noticed, that the

geographical distribution was determined depending on the country of incorporation of the platform

that hosted the crowdfunding campaign. This means that there might be cases where a project is

registered in a different country than the platform.

Germany is the country (24%) where most web entrepreneurs’ projects have been crowdfunded,

mostly through equity and reward crowdfunding platforms. The German equity crowdfunding

market has been developing with good results for a few years already, which might contribute to the

large number of web entrepreneurs using crowdfunding there. Spain holds a considerable

percentage in the chart, too. In fact, in Spain equity crowdfunding is not yet allowed and online

investing is forbidden by law. However, crowdfunding platforms can operate as matchmakers,

bringing private investors and web entrepreneurs together. Both markets also do not tout a strong

venture capital or business angel industry, so the funding gap might be more pronounced than for

example in countries that offer tax benefits to investors in early stage companies.

3.2.7. Type of Crowdfunding Used

How many web entrepreneurs use reward crowdfunding and how many, instead, use equity

crowdfunding to finance their projects? How do these percentages change in different countries?



The majority of web entrepreneurs, who successfully raised money through crowdfunding in Europe,

opted for reward crowdfunding platforms (56%). This could be due to the fact that running a reward

crowdfunding campaign is easier than running an equity crowdfunding one, where there is need of

business planning and financial forecasting skills.

By breaking down the previous graph per country, we obtain more insights.

Austria, Finland, Germany, the Netherlands, Sweden and the UK are clearly “equity crowdfunding

driven”, meaning that most of the web entrepreneurs who used crowdfunding to seek finance in

those countries opted for equity models. This confirms the hypothetical explanation we made in the

previous section, concerning Germany and equity crowdfunding. In Italy, where specific regulation

for equity crowdfunding was implemented in July 2013, no web entrepreneur had successfully

conducted an equity crowdfunding campaign at the time of our research. The regulation, while

framing equity crowdfunding detailed, is also likely to have created compliance burdens that have

delayed the growth of the industry.

3.2.8. Average Number of Backers/Investors

The average number of supporters of crowdfunding campaigns ran by web entrepreneurs around

Europe differs significantly depending on the type of crowdfunding used.



The average number of backers for a typical reward based crowdfunding campaign by web

entrepreneurs is 82 and 52 for equity based campaigns. Given that the average amount raised

through equity crowdfunding platforms is higher than the average one raised on reward

crowdfunding platforms (see table “Average Amount Raised by Web Entrepreneurs” above), we can

derive that for equity crowdfunding projects, a smaller number of backers contribute a total bigger

sum, compared to reward-based projects.

3.2.9. Projects Exceeding the Campaign’s Goal

Looking at the successful crowdfunding projects of web entrepreneurs we could also observe how

many managed not only to reach their target goal, but also to exceed it, as indicated by the following

graph. However, it is a known strategy for entrepreneurs to set the initial target of a crowdfunding

campaign lower in order to reach this hurdle faster and with more ease, using this as a claim to

success in order to win more backers for a larger amount.



3.3. Online consultation Some 185 participants, including web entrepreneurs and crowdfunding platforms, answered our

online consultation in full or in part2, framing the situation for crowdfunding in Europe under

multiple aspects and perspectives. In particular we deem that its results, presented by the charts

below, complement the desk research we reported on above.

3.3.1. Reasons to use crowdfunding

As displayed by the graphic below, the reasons for web entrepreneurs to use crowdfunding were

multiple. However, the most common one (71,4%) has to be found in the easiness of access to

money: crowdfunding is considered by many web entrepreneurs an easy way to access funds,

probably due to its transparency and direct link to investors. Nevertheless, it is worth to point out

that conducting a crowdfunding campaign is not that simple: it requires a lot of marketing efforts and

proactivity from the web entrepreneur’s side.

Other reasons that appear to be determinant in the decision of using crowdfunding as finance source

are:

2 The online consultation was conducted through the project website at www.crowdfundingnetwork.eu and via the European

Crowdfunding Network at www.europecrowdfunding.org and its social media channels during the last quarter of 2013 and into January

2014 among web entrepreneurs and crowdfunding platforms in Europe. The consultation was posted on the project website and

disseminated through the European Crowdfunding Network AISBL to around 1200 contacts. The overall response rate for the online

consultation was with 185 answers high, reaching a response rate of 15,4% which is notably higher than usual surveys, indicating a relevant

interest in the topic.



http://www.europecrowdfunding.org/


1. The difficulty/impossibility of obtaining funds from traditional financial actors, such

as banks and professional investors (57.1%). This fact highlights the position of crowdfunding

as an alternative source of finance.

2. The marketing “side benefit” of crowdfunding (57.1%). That is crowdfunding is also a

powerful marketing tool, helping web entrepreneurs to raise awareness among “the crowd”

about their projects.

3. The association with an innovative form of funding (57.1%). Web entrepreneurs

indicated as one of the main reason to use crowdfunding the fact that their project gets

promoted through an innovative channel.

3.3.2. Platform Choice

The survey investigated how web entrepreneurs who used crowdfunding to finance their projects

chose the platform where to run their campaigns. Interestingly, none of the respondents deemed

transparency, platforms’ partners (private and public) and success records determinant in the choice

of the platform.

The main driver for selecting the crowdfunding platform resulted to be the type of crowdfunding

offered (e.g. reward, donation, equity or lending). A good part of respondents (33.3%) did not use

any platform, which means that they opted for Do-It-Yourself models. The remaining stated that the

other factors (“Other”) influenced their platform decision. An example could be the dimension of the

portal’s online community.



3.3.3. Planned Target Budget

Half of the web entrepreneurs who used crowdfunding and participated to the survey planned to

raise less than €10.000. Nobody, instead, aimed at large amounts of funds (i.e. more than €250.000).

This shows that in Europe it is still challenging for web entrepreneurs to raise very significant

amounts of finance through crowdfunding, compared to the US, for example, where some campaigns

managed to raise even above $1.000.000.

3.3.4. Successful campaigns

The survey investigated how many web entrepreneurs succeeded in reaching their target budget.

Notably, 66.7% ran a successful crowdfunding campaign. This data is encouraging, showing that

crowdfunding may be a good finance source for web entrepreneurs.



3.3.5. Willingness to re-use crowdfunding

The survey asked web entrepreneurs, who used crowdfunding to finance their project, how likely

they were to conduct another crowdfunding campaign in the following five years. The results were

encouraging. As it is possible to observe in the chart below, the great majority of respondents is

expecting to use crowdfunding again in the future. This probably means that their first experience

with this new financing tool was overall positive.

According to respondents, potential future crowdfunding campaigns would mostly be aimed at

marketing, user input and market research, with raising funding or using crowdfunding to attract

other investors playing a secondary role.



3.3.6. Reasons for not having used crowdfunding yet

The survey asked to the web entrepreneurs that did not use crowdfunding yet as to the reasons.

As it is possible to observe in the graph, the main reason (32.1%) is that they had already other

investors. This may confirm that crowdfunding acts as a “funding elevator”, tightening the financing

gap between friends, family and fools and professional investors, such as business angels. Another

common reason given (28.6%) was that web entrepreneurs did not know which platform to use. This

might indicate a lack of knowledge from the web entrepreneurs concerning the platforms and their

business models or that platforms’ communication was not effective or transparent enough.

3.3.7. How to stimulate crowdfunding in Europe

Several activities could help fostering crowdfunding in the EU, as the chart below shows. In

particular, respondents indicated that it would be useful to publish data that prove that

crowdfunding is a viable alternative source of finance. This may once again signal a general lack of

trust in regards to this innovation, which needs to be built for the market to develop. Furthermore,

the survey shows that respondents believe it is important to spread the knowledge about

crowdfunding among web entrepreneurs and investors. Additionally to this, they also suggested that

promotion of best practices would be beneficial to encourage the growth of the market. The notion

of a quality label for crowdfunding platforms received the lowest support, though we cannot exclude

a bias in the answers. Also, the following questions were specific to quality labels and showed

stronger support of the idea.



3.3.8. Quality label for crowdfunding platforms: entrepreneurs

When specifically asked if a quality label for crowdfunding platform would encourage web

entrepreneurs to use crowdfunding, respondents had very diverse opinions. Nevertheless all the

respondents agreed on one point: nobody (0% responded “No”) believes that a quality labels would

be useless.

Most of the respondents (32%) indicated that the quality label should be supported by the European

Commission, as it is possible to observe below. The fact that all the participants in the survey

expressed a positive opinion with regards to the development of a quality label for crowdfunding

platforms may indicate that there is still a need to build an atmosphere of trust among web

entrepreneurs towards this new financial tool. This is critical for the development of a sustainable

crowdfunding market.



3.3.9. Quality label for crowdfunding platforms : platforms

We also asked crowdfunding platforms specificly about quality labels, the results of which are fairly

similar and in line with our expectations that an independend body or even the European

Commission is best placed to initiate such label.

3.3.10. Quality label for crowdfunding platforms: content

We then asked what such quality label should ensure in terms of quality and transparency, the

results indicate that the key points are about issues of customer protection such as safe payment



infrastructure, codes of conduct and ethical behaviour, transparency and privacy but also

professional skillsets of crowdfunding platforms.

3.3.11. European Commission’s role in promoting crowdfunding

The survey tried also to understand what role the European Commission should adopt in regards to

crowdfunding. The results, reported in the table below, indicate that 61.5% of the respondents

would be in favour of the EC creating a legal framework of crowdfunding in Europe. As mentioned

before, cross-border operations and platform’s internationalization are two of the main issue in the

European crowdfunding space, as the cost of complying to different national regulations is very high

at the moment. Other activities that respondents deemed important for the EC to undertake in order

to stimulate the crowdfunding market are: organizing workshops and trainings to explain web

entrepreneurs how crowdfunding works (50%); support a quality label for crowdfunding platforms

(46.2%), which is a result in line with those in the previous section.



3.4. Additional online consultation: Common Issues for Crowdfunding

Platforms This section is based on a survey that the European Crowdfunding Network’s Standard & Regulation

Work Group conducted outside of the Startup Europe project.3 Nonetheless, we believe that some of

its results may be of interest for this research, thus we decided to share them within this project

report.

The survey aims at understanding the main problems faced by crowdfunding platforms during

startup phase. This can be useful also in the present contest, by providing some indications on what

obstacles crowdfunding platforms dedicated to web entrepreneurs have to deal with.

The survey results indicate that the average legal and regulatory costs of setting up a crowdfunding

platform in Europe are around 22% of the total start-up budget.

Concerning the time employed by the portals to clarify which licence and legal process to undertake

in order to launch the crowdfunding activity, the majority of the respondents declared to have spent

3 to 6 months (45.2%) and 6 to 12 months (22.6%). Around 9.7% of the platforms, instead, reported

that the process took more than two years.

3 The results are based on an online survey of crowdfunding platforms only. We surveyed some 35 platforms accross Europe and accross

crowdfunding models in late 2013 and early 2014.



Once the portals understood the legal process, they had to apply for regulatory approval. For most of

the respondents this phase took 1 to 3 months (38.5%) and 3 to 6 months (19.2%) until the approval

of the relevant regulatory authorities had been supplied. However, there are still 11.5% of platforms

which had to wait more than two years to receive the final approval.

Furthermore, the survey also highlights that for 56% of the crowdfunding platforms, their licence

does not allow them to enter another EU country and 69.2% of the portals would have to double

their regulatory compliance cost to expand to another country.

Overall, it looks like regulatory compliance requires high costs and a considerable amount of time.

Crowdfunding platforms have to double their efforts and regulatory budget if they want to enter



another EU country. This, in particular, may hinder the creation of a pan-European crowdfunding

market.

4. A proposal for taxonomy and for data collection Throughout the project we worked to develop taxonomies and a framework for data collection and

near-real-time data publication in collaboration with crowdfunding platforms and other

stakeholders. In due course of the project we have continued to expand both aspects in detail in a

theoretical model with help from third parties and aimed to deliver results that are applicable in

praxis. We also have analysed the technical and economic feasibility of such an undertaking, which

would require significant investment and commitment to create.

4.1. Taxonomy To date, there is neither a real shared taxonomy specific to crowdfunding, nor for web startups

(indeed, there is no clear definition of web start-ups neither). Here we focus on taxonomies for

crowdfunding, while ensuring its applicability to web startups. We aimed at a widely accepted list of

variables and dimensions that would prove beneficial when it comes to identifying and

understanding the underlying start-up dynamics in the crowdfunding financing model. The

workshops and consultations carried out in this framework shed light on these required variables and

dimensions. To our knowledge it was the largest exercise of its kind with professional participants

and representative from crowdfunding platforms across Europe.

We envision that the several different types of stakeholders will find the use of a standard taxonomy

useful in their activities. For example, the European Commission may define and organize actions

pertaining to crowdfunding according to the different users, market segments and sub-funding types

defined.

Web entrepreneurs and ICT startups will find it useful to define their own funding strategy. They can

use the taxonomy as a way the refine its own action plan and define the most suitable market

segment and funding source for their project. And, for investors who rely on both analysis and

benchmarking when making an investment decision, it will be vital to understanding the funding

strategy of a particular project to define its inherent risks and potential returns compared to other

projects. Combined with analytic capabilities and data, a standard taxonomy can become a key tool

for the financial investors.

And last but not least, for public sector bodies (such as supervisors) a standard taxonomy should

enable them to define and monitor specific developments relevant to their agenda. For instance, a

supervisor could seek to assess the usage (and compliance) of a particular type of funding in a

specific market and draw actions depending on their findings.

4.2. Framework for Data collection Defining a framework for data collection & publication requires considering the interest of all

stakeholders of the European crowdfunding industry. While thriving, this new type of funding



sources creates a larger impact on society and the companies that it helps to finance. This study

shows that different players have an interest in the activity of collecting and distribution

crowdfunding-related data. The following provides the key findings, the interested reader can find

the details of the work done in the appendix

We defined the most important elements of such a system implementation on an open consultation

for Technology Providers, which was published on the project website and communicated to selected

and pre-identified technology providers as well as other stakeholders. This provided insightful

information about the framework for data collection and data contribution. On top we

complemented the framework with considerations based on desk research specific to data

publication and economic models for data collection and publication systems, which is a key driver of

success when implementing such system (and potentially new market players).

We have identified a number of hurdles for implementing a data collection & data distribution

system, including the need for significant efforts and resources (infrastructure, developers, project

management …). Indeed, interfacing with the data collection system and providing the data comes at

a significant financial and opportunity cost for most of the contributing crowdfunding platforms,

other data collection and data distribution system providers have already engaged with our targeted

contributors, potentially creating competing redundant data requests and risk of undue double-

usage. In the short term, manual collection of heterogeneous data generates a very cumbersome

data alignment, retreatment and data verification burden. Moreover it creates incomparable

datasets. We believe that these reasons also account for the lack of commercial solutions in the

sector for now.

In conclusion, we see the best solution for enabling exhaustive, comparable and accurate data

collection in defining common data standards and models as well as providing eco-system that is

incentivizing the data remittance in a relevant format and in a timely manner. To motivate

crowdfunding platforms to contribute data, incentives or financial resources are needed as well as

guidelines for data remittances in order to provide specific mechanisms that will ensure exhaustive

data gathering.

It is also necessary to define the data model to be used in such a system (both for data collection and

for data distribution), to carry out the implementation of the system and the data collection interface

(with appropriate resources and objectives) and to provide a model that fosters all players. With

regard to sustainability and trust, it is also needed to enable private companies to be part of the

economic model for data collection and data distribution and to define open and transparent

guidelines and standards for data usage that at the same time protect the commercial interest of

crowdfunding platforms and the privacy of project owners and investors.

We further developed taxonomy for the crowdfunding sector aimed at web entrepreneurs, though

we believe that this taxonomy will also stand for other projects. We envision that the several

different types of stakeholders will find the taxonomy useful in their activities. Different usages may

be envisioned for the European Commission, which might want to define and organize actions

pertaining to crowdfunding in Europe according to the different users, market segments and sub-

funding types defined. It also might want to carry further analysis to define the most likely path of



action in order to foster favorable conditions for this new type of funding for web entrepreneurs. But

also for web entrepreneurs and ICT startups, which will find it useful to define their own funding

strategy. They can use the taxonomy as a way the refine own action plans and define the most

suitable market segment and funding source for their projects. Once more data is available to them;

web entrepreneurs may also define the specific investor’s requirements and market dynamics

applying to their specific product and market segment.

For investors, which rely on both analysis and benchmarking when making an investment decision,

the taxonomy can provide an understanding of the best funding strategy of a particular project

enabling them to define inherent risks and potential returns. Combined with analytic capabilities and

data, this can become a key tool for the financial investors. And, last but not least, for other public

bodies, such as supervisors, which need to base their analysis and actions on actual definitions

applicable to the specific sector concerned. Crowdfunding has an impact on different types of

activities including supervision, user’s interests, incumbent players associations. The taxonomy

should enable them to define and monitor specific developments relevant to their agenda.



5. APPENDIX The Appendix contains background information and additional details relevant for the work

provided, but not necessary for the presentation of the results in the main section of this report.

5.1. Research analysis and online consultation Desk Research As part of the project we conducted extensive research on web entrepreneurs and crowdfunding in

Europe. In particular the research aimed at understanding how web entrepreneurs use crowdfunding

to finance their projects and if crowdfunding platforms - as they operate now - fit their needs.

Research included an online questionnaire, telephone conversations and extensive desk research.

The first stage, desk research, was directed at tracing a comprehensive directory of existing and

operating equity and reward based crowdfunding platforms around Europe. Our research has

identified some 230 platforms, but we are aware that we will have missed some platforms and that

in the time since our efforts there might have been new platforms been created or some

disappeared. For each platform was indicated: i) the crowdfunding model used; ii) the country of

incorporation; iii) the countries in which the service is offered; iv) the languages available; v) the

sector focus.

A first analysis was conducted on these data, focussing specifically on those platforms which have a

sectoral focus on Web and Internet businesses. The results are reported in the following section.

In the second stage, analysis of the desk research, a sample was derived from the data collected

during Stage 1. This sample included the biggest equity crowdfunding platform (where available) and

the biggest reward crowdfunding platform identified in each country. The platform’s dimension was

evaluated by looking at the number of financed projects and of social media followers. For each

platform in the sample were identified, among the successful crowdfunded projects, those initiated

by web entrepreneurs. Data on these were then collected from the sample. In particular, we looked

at: i) the amount raised by the project; ii) the targeted amount; iii) the crowdfunding type used - i.e.

equity or reward crowdfunding ; iv) the country where the fundraising took place; v) the numbers of

backers/investors.

The online consultation was structured based on the initial input from the “High-Level Workshop on

Crowdfunding and Web Entrepreneurs” and was disseminated to all participants of this workshop

and other interested stakeholders. It was also made public on the project website and the website of

the European Crowdfunding Network AISBL. Social media was used to further dissiminate it and the

the European Crowdfunding Network AISBL informed its network of at the time around 1200

contacts via email of the survey. The survey remained open for just under three months.

5.2. The potential impact from the main dissemination activities and

exploitation of results In the following we will discuss the potential impact from our dissemination activities. We are aware

that that much of our dissemination activities cannot be monitored adequately and those indicators



used will often be measures of output rather than of outcomes and impact in the sense of actions

that were directly initiated by our outputs. Nevertheless, we also understand that much of the

impact will be long term, likely with additional influences and thus not measureable (other than

through a full Social Return of Investment Analysis, which is well without the scope of the actions

contained within this project. We will focus on two aspects of the dissemination activities, the High-

Level Workshop on Crowdfunding and Web-entrepreneurship and the Web-portal. The potential

impact of our research activities will depend on future actions and the intentions of the European

Commission. However, the European Crowdfunding Network AISBL is taking some work forward (in

relation to data collection and taxonomy development) in order to finalise the testing of the here

outlined framework.

5.2.1. High-level Workshop on Crowdfunding and Web-entrepreneurship

On the 4th of June 2013, a workshop for web entrepreneurs, crowdfunding platforms and

stakeholders was organised under the remit of the Startup Europe initiative of the European

Commission’s DG CONNECT under the title: “High-level Workshop on Crowdfunding and Web-

entrepreneurship” with specific focus on web entrepreneurs. The focus of the workshop was

supportive of the European Commission’s Digital Agenda, which has prioritised the goal to

strengthen the environment for web-entrepreneurs in Europe, to increase the number of web start-

ups and support their growth.

The workshop aimed to discuss and identify issues affecting the growth of web start-ups across

Europe, the prospects for increasing pan–European access to crowdfunding for web-entrepreneurs

and ways of fostering stronger and more competitive European crowdfunding brands. The focus was

on a dialogue between the crowdfunding industry and web start-ups in order to identify how needs

and expectations can be addressed in the best possible manner and in order to produce actionable

results as much as in forward looking statements.

The workshop was attended by a mix of active participants, in total more than 70 with participation

from the European Commission. Participants represented, excluding European Commission and

European Crowdfunding Network AISBL participants above 40 percent crowdfunding platforms and

30 percent entrepreneurs. The remaining stakeholders covered academia, bloggers and consultants

(e.g. White Board Mag, NESTA, Westartup…) as well as industry groups (e.g. Eurochambres, Business

Angels Europe…)



Academics

7%

Entrepreneurs

30%

Crowdfunding

Platform

45%

Industry

Groups

7%

Bloggers &

Consultants

11%

A general introduction was given by Isidro Laso of DG Connect, European Commission and an

overview on crowdfunding was given by Peter Baeck of NESTA (UK). The remainder of the day was

structured in six workgroups organised according to an adapted design thinking framework, focused

on developing applicable resolutions on the following topics:

I. Side Benefits of Crowdfunding, facilitated by Irene Tordera, Maastricht University (the

Netherlands). The overall question was how crowdfunding might help with market and

business model validation, pre-sales, marketing or pricing web services and products.

II. Crowdfunding as a realistic financing alternative, facilitated by Benoit Vandevivere, AAA

Group (Spain). This group discussed how crowdfunding might be able to help close the

funding gap for pre-seed and seed start-ups, while innovating new ways of funding but also

create deal flow for business angels and venture capital.

III. Communication for crowdfunding platforms, facilitated by Raf Weverbergh, Whiteboard

Magazine (Belgium). The information needs of entrepreneurs with regard to crowdfunding

were at the centre of this workgroups focus, discussing crowdfunding platforms

responsibilities in providing transparency.

IV. Scaling up across Europe, facilitated by Guillaume Desclee, MyMicroInvest (Belgium). The

main focus was on how crowdfunding platforms can develop pan-European reach, both for

investors and entrepreneurs.

V. Open data and transparency, facilitated by Karsten Wenzlaff, Ikosom (Germany). This group

was asked to develop an approach to industry transparency and trust with regard to

consumer protection and general public data provision.

VI. Cooperation with public bodies, facilitated by Iwona Mertin, EUROCHAMBRES (Belgium). The

focus of this workgroup was on how different public stakeholders can help in supporting the

development of crowdfunding. Regulatory questions were excluded from the discussion.



The results were compiled by the workshop moderators with the input of the workshop participants

following the workshop itself, this ensured ongoing review and development of the ideas and

commitment from the participants. The Results, after editing, were presented to the European

Commission and published as Proceedings of the High-level Workshop on Crowdfunding and Web-

entrepreneurship in August 2013 on the project website (both as a single document for download

under Resources and as individual stories under News) as well as on the European Crowdfunding

Network AISBL website. The proceedings were also sent by email to the full contact database of the

European Crowdfunding Network AISBL of around 1200 individuals at the time, including press and

bloggers. The results of the workshop, in general focusing on issues around data transparency and

collection were used as the basis for all following work on draft taxonomies for crowdfunding web

startups and a framework for data collection and near-real-time data publication of crowdfunding

offerings and covering market developments.

5.2.2. Web-portal

The web-portal of the Startup Europe Crowdfunding Network for webentrepreneurs has been a

dedicated delivery for engagement as well as a key dissemination platform. The portal has been

developed with the aim of providing:

General introduction to crowdfunding and the benefits and opportunities of crowdfunding

Links to crowdfunding platforms (for web entrepreneurs)

Rules governing the platforms

Educational information how to run a successful crowdfunding campaign

How to run a successful crowdfunding campaign

Which type of crowdfunding is best for specific businesses/projects

Information for funders how to choose a campaign

Access to crowdfunding opportunities in the EU

Opportunity for networking and collaborative problem solving among web entrepreneurs

The development of the portal followed the work on the related issues and has progressed adequately. The portal follows a simple structure and is easy to use. All areas, pages or posts are reachable with two mouse clicks.



5.2.2.1. Content of the web portal

The current web portal features a number of specific areas in which information for different purposes can be obtained. Some the information is a dedicated result of the project, others present data that has been developed by the European Crowdfunding Network AISBL outside of this project but are a vital contribution to the overall project scope.

The portal of the Startup Europe Crowdfunding Network for web entrepreneurs features a general About page in which information on the project and Startup Europe are given, the parties behind the project and the steering council, including relevant web links.

Home

About News

(listing of posts)

Resources

(listing of posts)

Directory Cases

About

Team

Contact

Crowdfunding

101

18 pages with

details on how to

work with

crowdfunding as

web entrepreneur

Eight case studies

of web

entrepreneurs

crowdfunding

success stories



Under the News tab news worthy items from the project or related issues have been published, including posts written for the international crowdfunding blog www.crowdfundinsider.com that have been reposted here. In this section we also republished the parts of the High-level Workshop on Crowdfunding and Web-entrepreneurship Proceedings in order to increase access opportunities. The online consultation of the Startup Europe Crowdfunding Network featured visibly on all pages. However, it remains difficult to identify content specific to web entrepreneurs – as much of news relevant content is either general, focused on services or technology (often hardware or gadgets within crowdfunding) – or is inadequate promotional material from individual companies (often not balanced in their presentation of facts or developments and therefore in our view not relevant for a portal such as this). We believe that rather than pushing crowdfunding specifically for web entrepreneurs, it will be advantageous to push crowdfunding into the existing technology and web community (and others) by increasing awareness of success stories, impact and reach of web related crowdfunding activities.

Under the Resources tab industry papers and other relevant studies have been posted, such as the full version of the High-level Workshop on Crowdfunding and Web-entrepreneurship Proceedings but


http://www.crowdfundinsider.com/


also the Call for Submission for Technology Providers used to identify openly relevant data technology providers that would be able to assist in establishing a data collection tool and platform to publish crowdfunding opportunities across the EU.

As a result of our work around taxonomies and data collection, we believe that nearly all general resources to be developed today with regard to crowdfunding (best practices, transparency, data, taxonomies, rankings etc) will not be adding specific value with a focus on web entrepreneurship, rather we believe that a certain part of the web entrepreneurs is more aware of and more affine to crowdfunding than non-technical counterparts in other areas of the services industry. Any actions in promoting crowdfunding to web entrepreneurs should therefore be designed for all other entrepreneurs (and specifically service entrepreneurs) with the understanding that it will be web entrepreneurs that are likely to pick up on crowdfunding prior to other businesses because of the close relationship (and often dependence) on the internet and internet-based communities.

Under the Crowdfunding 101 tab we created an easy access guide to crowdfunding for interested web entrepreneurs and others, giving help in understanding crowdfunding in general and with specific approaches in mind. The 18 different pages answer a cross section of potential questions and help guide interested parties in building and executing a crowdfunding campaign, they are of course not to be understood as a complete list that will answer any potential issues for any particular campaign or idea. Topics covered are:

What is Crowdfunding?

The added value of crowdfunding

Types of Crowdfunding Platforms

How to set up a crowdfunding campaign

How to Set a Crowdfunding Campaign's Goal

How To Create Compelling Rewards

Crowdfunding online solutions, plugins and software

Why People Invest Through Crowdfunding

Understanding What Type of Crowdfunding is Best for Your Startup

How to Shoot a Great Crowdfunding Video



Using Social Medias to Engage with Campaign Supporters

How To Protect Your Idea

How To Get Your Project On Platform's Homepage

Tips To Launch a Crowdfunding Platform

How Peer-to-Peer Lending Works

This part of the online portal serves as a general introduction to crowdfunding and clarifies the benefits and opportunities of crowdfunding, while also offering educational information how to run a successful crowdfunding campaign, a successful crowdfunding campaign and which type of crowdfunding might best for specific businesses/projects plus providing information for funders how to choose a campaign. However, none of these aspects can be sufficiently answered in general and will always need relevant research by the funds seeking entrepreneur or, if needed, the advice of a third party.

We note that the lack of public knowledge is indeed inspiring a new breed of consultants to take up the challenge of bringing relevant knowledge to the market. Crowdfunding consultants, despite the fact that they have no benchmark of their own expertise are appearing across Europe, in Germany they have even encouraged a collaboration with the Chambers of Commerce in offering crowdfunding consultant accreditation. While from the basis of this project we cannot comment in detail on any such actions, we definitely witness a growing interest on both buy and sell side which might develop into specialised agencies similar to other services build around the web, such as search engine optimization, social media or online marketing consulting agencies.

Under the Directory tab we have researched and listed a non-comprehensive list of crowdfunding platforms open to web entrepreneurs from all major crowdfunding funding models (donation, reward, debt and equity). Platfroms are listed by country with indication of their offered funding model and web-link. While these list not all platforms available, they comprise more established or more focused platforms and are likely more suitable for a first time crowdfunder. However, we refrained from introducing any data that could be used to provide a ranking on this page in order to remain fully independent and unbiased. This page offers specific links to crowdfunding platforms for web entrepreneurs that may help to get a better overview on the market.



We believe that a directory such as this will always be limited by a number of external factors that the EC might be inclined to help address. Crowdfunding platforms as such are not defined businesses and the inclusion of one crowdfunding platform over another cannot be objective at this point in time. Similarly, web entrepreneurship does not adhere to one definition and many crowdfunding platforms use different terminology that are likely to include web entrepreneurs, but might also include others. A standard taxonomy also with this respect will help to gather relevant data, but moreover, lack of recognition of crowdfunding platform as a business or sector means there are no public registries, such as with Chambers of Commerce, that would allow drawing on a relevant overview of crowdfunding platforms. Increased regulation for equity and debt crowdfunding platforms such as in Italy, France or the UK will be helpful to some extent, but as donations and reward based crowdfunding is not adequately captured by these regulation, relevant platforms will continue to operate as advisors and will not be covered specifically by official company registries as crowdfunding businesses. In this respect, web entrepreneurship related crowdfunding platforms are even less visible.

Under the Cases tab we listed eight case studies that will help interested web entrepreneurs to better understand what types of projects have been successful on what type of crowdfunding platforms. We believe that success stories do not need to be large in funding but inspiring in promoting the idea of crowdfunding. The selected cases cover a mix of country and funding approaches and should therefore be able to be convey the opportunities that crowdfunding can have for a variety of businesses.

While it is possible to generate success cases (and failure cases) of web entpreneurs’ crowdfunding compaigns by monitoring the market, the physical work to do this will not make such an endeavour sustainable. Also, while some data is publicly available, to contact individual platforms and project owners is prohibitive time consuming for a wider roll out. Again, the establishment of a data collection framework and its pan-European implementation would be most favourable in detecting success and failure stories – and thus also allow drawing lessons on best practices.



5.2.3. Other aspects explored regarding the portal

We also explored the feasibility of implementing the following services on the web portal:

(1) Access to crowdfunding opportunities in the EU (2) Opportunity for networking and collaborative problem solving among web entrepreneurs

1. For the first aspect, offering crowdfunding opportunities in the EU, there have been two main hurdles to overcome from developing the relevant services.

First, in order to obtain relevant data from crowdfunding platforms that allow to show actual crowdfunding opportunities one needs to either have access to the application programming interface (API) of the crowdfunding platform (only large platforms have these today) or develop a separate API that crowdfunding platforms than have to implement into their system (which is a time and cost hurdle for platforms). The development of relevant APIs is quite costly (development cost for a single API can well reach €10,000), which means that the operator would have to cover relevant cost (though usually less the previous this figure) for every crowdfunding platform that offers access to their data via API. On top, crowdfunding platforms that do not yet have their own APIs would need an incentive to integrate a third party API (developed by the data aggregator). An alternative is to win crowdfunding platforms to submit regularly relevant data in CSV format that then can be uploaded into the portal. In this scenario the problem remains to motivate crowdfunding platforms to engage in this activity on an ongoing basis. In both cases, a clear value added for the crowdfunding platform remains unspecific. Our discussions with crowdfunding platforms have therefore not generated a relevant interest for larger support. However, as discussed in part 5, we have formed collaboration with CrowdScanner Ltd. In the UK, a commercial entity that has developed a relevant search or aggregation engine and is rolling this out as of late Spring 2014 through a business model that promises crowdfunding platforms increased incoming investors through a network of sophisticated investors. There are other similar undertakings, but none we have seen offering the same possible reach and scope at this point in time. The success of this and other such operators will be providing further insights into this issue.

Second, in order to legally be able to republish crowdfunding offers with regard to equity and debt, some legal compliance is required. In some proposed and existing legislations this is or will be forbidden (Spain, for example). Legal compliance would depend on the business model pursued, however, and a free listing would have the least (and in many cases no) compliancy issues. In combination with the first aspect, the implied cost for developing and rolling out such a system will require a significant amount of funding and, with regard to sustainability, a clear business offering to crowdfunding platforms that would incentivise an adequate fee structure to be operated.

We spent significant efforts on exploring potential solutions around taxonomy and data collection in collaboration through an open public call (see below). Here, our aim was not to support a commercial business or to engage in any business activities with any such entity, but to use existing technology free of charge in order to test at relatively low cost the implementation of a standard taxonomy for data reporting within the European crowdfunding sector.



2. For the second aspect, opportunity for networking and collaborative problem solving among web entrepreneurs

Throughout our work, including workshops and surveys, we did not identify any issues related to crowdfunding that would have had a specific interest to web entrepreneurs. Indeed, the issues around crowdfunding that might be of interest or hindrance to web entrepreneurs today have turned out to be issues surrounding services industry entrepreneurs rather than specifically web entrepreneurs, such as difficulties in designing relevant reward structures. Nevertheless, the web affinity of web entrepreneurs makes them more likely to understand crowdfunding and its issues compared to other non-web related services entrepreneurs. There is increasing interest in relevant media regarding crowdfunding and it has been positive for our project to get coverage in blogs such as TechCrunch.eu or Crowdfundinsider.com. Web entrepreneurs, we believe, are therefore likely to be early adopters able to exploit crowdfunding via their existing social and business networks. As such they require special support and focus, and their approach to problem solving within crowdfunding might be useful for other entrepreneurs later on.

5.3. Data Collection With regard to the data collection, we have identified a number of hurdles for implementing a data

collection & data distribution system. System implementation and maintenance requires significant

efforts and resources (infrastructure, developers, project management …). Interfacing with the data

collection system and providing the data also comes at a significant financial and opportunity cost for

most of the contributors (crowdfunding platforms). And, as data collection and data distribution

system providers engage with crowdfunding platforms they are creating competing redundant data

requests and risk of undue double-usage. A single data model and taxonomy does not exist and still

needs to be defined (see our work on the Taxonomy in this report). In the short term, manual

collection of heterogeneous data generates a very cumbersome data alignment, retreatment and

data verification burden. Moreover it creates incomparable datasets.

We see the only solution for enabling exhaustive, comparable and accurate data collection is to

define common data standards and models as well as to provide an eco-system that is incentivizing

the data remittance in a correct format and in timely manner. Our work has helped clarify a number

of actions in need to be carried out prior to implementation. There is a need to provide incentives,

financial resources, and guidelines for the data remittances from contributors (crowdfunding

platforms), provide incentives and specific mechanisms that will ensure exhaustive data gathering,

define the data model to be used in such a system (both for data collection and for data distribution),

carry out the implementation of the system and the data collection interfacing as a stand-alone

global project (with appropriate resources and objectives), provide a model that fosters all players

and enables private companies to be part of the economic model for data collection and data

distribution and define guidelines and standards for data usage.

5.3.1. An Economic model for Data collection and publication

We see a "Two-Tier" model for data collection and publication where crowdfunding platforms (or the

companies that do operate crowdfunding platforms) are required to contribute certain data to the



target system. The model would be "Two-Tier" in the way that legally required entities may choose

(a) to contribute directly to the target system (and therefore bear the costs to comply with the data

collection process) or (b) to delegate its regulatory obligation a third party data collection agents. In

the second case, the third party data collection agent will be required and liable to submit the data

to the target system in place of the crowdfunding platforms. This second tier model enable different

commercial activities and bilateral sources of revenue with those third-party data collection agents in

order to compensate for the process costs.

For Data Publication, the target system should also enable the public and other market players to

access certain subset of data (possibly at a price when using specific data or in higher volumes). This

aspect is also discussed in the previous section. This will generate revenue opportunities both for the

market players and for the data contributors. In this case data contribution should be at the least

free for market players (and not bear a cost like for national business registers).

5.3.1.1. Framework recommendations

As detailed in the previous section, while implementing a system for crowdfuding data collection and

data publication provides significant benefits for the market (transparency, market insights, basis for

customer protection, ...), it is not exempt of challenges. As discussed, most challenges come from the

data collection process. We provide here below some recommendation in order to address these

challenges.

Data models are heterogeneous across data contributors

Defining a single data model will provide ground for an interoperable and efficient data collection

process. This process may also introduce indirect costs for all those potential contributors

(crowdfunding platforms) that may opt not to use it.

We suggest that a reference organization carries out standardization work for such a shared data

model. This model should enable the construction of taxonomies useful for reporting, accounting and

supervisory purposes. In this context, our suggestion is to develop an XBRL taxonomy for

crowdfunding, a widely accepted and open source data model currently used for accounting,

reporting and supervision.

Contributors systems do not always enable data collection

Contributors do not always enable data collection either (1) for technical reasons or for (2) business

related reasons.

In the first case, since the technologies used for crowdfunding basically can enable some sort of data

extraction, the decision comes down to a question of costs. Therefore, the contribution of data

should be very easy to do from a technical point of view (several technical formats ...). Also, it can be

imposed from a regulation point of view to provide the information to a standardised data collection

system according to specific rules. It could also be granted a specific (regulatory) advantage to the

contributors to incentivize the data contribution.



In the second case, when a contributor does not want to contribute, again a regulatory condition can

be foreseen that imposes certain level of data disclosure and reporting for certain level of activities

or certain platform sizes.

Alternative incentives could be of commercial nature and be built into a relevant business plan of the

data collection agency. Such incentives should, directly or indirectly, be aimed at increasing the

potential revenues of the contributing crowdfunding platforms.

Technically enable contributors to provide data (in the required format) may carry

significant costs to the contributors (both for set-up and for operations)

This specific challenge is related to the previous one. Costs incentive or specific subsidies should be

envisioned in order for market participants to cover the costs involved in the contribution, where a

lack of business incentives exists.

When they do contribute, data contributors may wish to contribute data in a single format

only and in a single submission only

Some contributors (crowdfunding platforms) will find it inconvenient to report into multiple systems.

Again, the additional cost burden will restrict the number of unique data collection agencies as long

as there is no standard interface agreed upon. Some crowdfunding platforms have already developed

interfaces to provide information to data collection agencies (e.g TousNosProjets.fr in France). Such

existing types of data collection agencies ("data aggregators") may prove a very convenient way for

public bodies to get large scale data in a suitable format for their purpose. These data aggregators

could also become data providers when incentivized to do so.

When they do contribute, data contributors may wish to impose restrictions and

conditions to the commercial use of their data

Crowdfunding platforms maintain a significant amount of data that could be considered private or

protected under existing privacy guidelines. In order to enable aggregated data sharing, public bodies

can seek to define standard terms for data usage in the crowdfunding industry (that could include

supervisory purpose) in order to foster a favourable market environment for data collection,

interoperability, and market collaboration. Restrictions would not be applicable for certain sub-set of

data used for supervisory purposes.

The scope of required data has to be thoroughly defined for each type of funding (e.g.

reward based, equity, debt crowdfunding...)

There are different types of crowdfunding that answer to funding needs of startups and new

projects, including reward-based, equity and debt-based crowdfunding. Each of these will carry

different requirements in terms of data and public information. The different types of funding also

interact differently with and at different stages of the projects listed on them for fundraising. We

recommend that the scope of data required will be different for these different types of

crowdfunding. For example, reward-based crowdfunding requirement may include some financial

data being appropriate to its nature. Where financial return and financial risk is at stake (for equity /

debt based crowdfunding), more financial data about the project and the counterparty may typically



be required. However, with regard to socio-economic data a standard may intend to be the same

across all forms of crowdfunding platforms, but existing operating models need to be taken into

consideration in order to reduce the cost of implementation to crowdfunding platforms

unneccessarily.

Data collection and publication systems do carry significant operational costs (for the

operator)

Another challenge to overcome it that the data collection and publication system will itself carry

significant operational costs to run. Many activities, technical infrastructures and data treatments are

required in order to operate such a system effectively. Public bodies (or potential sponsors) should

come together and define the purpose of the data collection and data publication system and define

an appropriate funding plan for this activity, for example with the guidance of the European

Crowdfunding Stakeholder Forum. Typically, private parties or financial institutions may have a

specific commercial interest in accessing the data, in which case it can be wise to assess in which

ways public data may be access by such institutions and seek appropriate budget contribution. If

contributors do not allow data to be use by other market participants (or by the public) then funding

should be public.

Data publication does require control and definition of access rules

It is necessary to define the extent of data that should be available to the public or to other market

operators. Defining the exact scope is not an easy task as it will impact the potential business models

of both contributors (crowdfunding platforms) and other market players that provide ancillary

services (e.g data services, credit scoring ...). We recommend defining three level of confidentiality

for data variables that could be made available through the data publication system:

1. Data that remains confidential, except for supervision/national security purpose (e.g names

of contributors)

2. Data that will be available to the public, albeit with restricted access volumes (potentially

allowing for a larger volume extraction for a fee).

3. Data that will be accessible to the public and market participants, with no volume restriction

For the large subset of data variables, it is recommended to attach a certain price for data access. In

the same as it is currently done for accounting data collected and distributed by national commerce

and business registers.

5.3.1.2. Monitoring Market Developments

The analysis of potential process for Monitoring Market Developments builds on the previously

detailed data collection and data distribution framework. Indeed, we see that many indicators and

measurements useful to monitoring and market development will likely come from the data

collection process itself. The proposed taxonomy allows for creating additional analytics, ratios,

trends and data sets useful to the interested stakeholders.



Nevertheless, there remain two areas that require particular processes for data collection and

market monitoring are:

1. The contributors / crowdfunding platforms that have not been identified by the market

authorities; or those platforms who will not provide their data.

2. The contributors / crowdfunding platforms that will not fall under the scope of the -

potentially compulsory- Data Collection & Data Distribution ; or those outside of the direct

European jurisdiction

The most important data to consider for defining and monitoring market trends most probably rely

on a few main metrics and data variables:

- The type of platform / the financial nature of its activity(ies)

- The sector of activity

- The country(ies) of Operations

- The amount of finance it handles

- The exact name or legal entity of the crowdfunding platform operator

- Detailed description / Qualitative information / Press monitoring

In our understanding monitoring market development will use a different type of system and

information than the one defined for the data collection and data distribution. This system for

market monitoring is also potentially much easier to implement on the short term.

In practice, an “Observatory for Crowdfunding” could be established that periodically lists all existing

crowdfunding platforms active in the extended European regions, the bordering countries and more

generally all crowdfunding platforms collecting finance from European citizens. An important step

towards market transparency and public information will be made by defining collecting metrics and

data variables.

Another interesting benefit to systematically and periodically collect such information on existing

market players is to be able to identify trends and macro-economic impacts or movements in some

specific sectors or locations. For instance, some economic sectors are currently witnessing more

crowdfunding platform creation and with much higher finance volumes handled than others (e.g.

sustainable energy, regional development projects, intelligent objects design & manufacturing …)

We recommend that public institutions do create an independent not-for-Profit “Observatory for

Crowdfunding” that monitors trends and systematically identifies new crowdfunding concepts and

platforms ; potentially feeding information into other data collection tools and/or supervisory

processes.



5.3.1.3. Economic models for data collection and publication systems

In order to not rely on public funds and subsidies, it is necessary to define suitable economic models

to enable the overall market to function properly and to llimit disruption of market dynamics by

imposing data collection or light regulatory burden. Enabling economic models around data

collection and data publication is most importantly to ensure acceptance and usage by the

contributors and market players themselves.

Here below a few business models that any regulation or public-driven operational rules should

enable:

the emergence of third party data collectors and data publication platforms (operating like

national business registers)

third-party data aggregators, using the data for other business activities (e.g project

aggregators, crowdfunding investment opportunities brokers, data aggregators, credit /

investment risk scoring services, financial media ...)

Enable data contributors to generate revenue from their data contribution

More generally, data collection should not be an impeding burden for market players. Data collection

and data collection for public purpose should be enabling.

However, there are different ways to monetize data collection and publication systems for private

operators. Here are some possible models:

Contributors pay the cost of operating the system



In this model, the contributors (crowdfunding platforms) are being incentivized to provide their data

and to pay for the contribution of data. This can be achieved with finding a good commercial reason

for contributors or to impose a regulatory burden on the contributors. Amongst the commercial

reasons for a contributor to financially contribute to the system’s costs is the provision of new clients

or commercial advantage.

In this case, the system will need to display all investment opportunities to investors that would

otherwise not be available to the contributors (crowdfunding platforms). In order to justify such a

solution the net cash flow to contributors resulting from commissions through the systems

commercial operation should be higher than the cost investment and cost of resources opportunity.

Data clients pay the cost of operating the system

In this model, the system operator will seek to break even its costs by selling the data to clients. The

different levels of detail and different types of data shall provide value added to existing market

players (e.g. investment funds, banks ...). The level and scope of the data provided to clients should

carry commercial value. Data should be provided in a timely and qualitative manner, without

additional restrictions, by contributors in order to maximise commercial value.

A public body (or a sponsor) pays the cost of operating the platform



There is a public benefit to provide board access to data. Where such collective interest prevails and

few commercial activities may be financially sustainable, considering public funding to access such

data may also be envisioned.

In this model, a public body (or a sponsor) will provide the main financial means to implement and

run the system for the common good of the public. The budget will be defined and potentially

revised throughout the life of the data collection and publication system. In practice, it can be

operated by a public body or by a private operator.

As for the other models, data should be provided in a timely and qualitative manner, without

additional restrictions, by contributors in order to maximise commercial value.

A balanced model



This model is presented as a potential balance between the different contributions and still allowing

for the different business players to be able to grow. Here the Government provides subsidies (or

incentives) to those contributors (platforms) that provide data required by regulatory demand to the

data factories. These data factories can be public or private players that are then delegated for the

purpose of regulatory data contribution. The same data could be used by the data factory for a

commercial purpose – depending on the data usage agreement established with the contributor. We

foresee that some contributors will not want the submitted data to be used for other purpose than

their regulatory obligations and in which case the cost of the data remittance to the data factory will

be carried by the contributors. In the case where the data factory can generate revenues with the

data, related revenue can then be used to decrease the service fee to the contributor. Thereby

benefitting to all players involved in the transaction. This model also implies that the data remittance

obligation is somehow transferred to the data factory that collect the data on a real-time / regularly

basis from the contributors; although quality, timeliness and accuracy of data remains an obligation

of the contributor (crowdfunding platform).

Implementing this model could allow for several data factory (potentially commercial /

private ones) to be created. A license model maybe appropriate for these types of data

collection players (data factories).

Challenges

The main challenges for the framework on data collection and data publication are the following:

- Data models are heterogeneous across data contributors

- Contributors systems do not always enable data collection



- Technically enabling contributors to provide data (in the required format) may carry significant

costs to the contributors (both for set-up and for operations)

- When they do contribute, data contributors may wish to contribute data in a single format only and

in single submission only

- When they do contribute, data contributor may wish to impose restrictions and conditions to the

commercial use of their data

- The scope of required data has to be thoroughly defined for each type of funding (e.g. reward

based, equity, debt crowdfunding ...)

- Data collection and publication systems do carry significant operational costs (for the operator)

- Data publication does require to control and define access rules (who may access the data, at what

cost/price and for what purpose)

- An economic model has to be provided both for contributors and the system operator (in order to

cover the costs involved)

Example - MixMarket.org

A widely used example of data collection and publication system is MixMarket.org. This system has

been successfully implemented by the Microfinance Information Exchange, an NGO sponsored by the

CGAP and a number of private foundations, in the Microfinance secto. MixMarket.org is an open

source platform that gathers information and data online from microfinance institutions across the

world. All contributors (microfinance institutions) do use a single data model and taxonomy for their

data gathering. The data model and taxonomy is using XBRL standards that are widely accepted for

supervisory purpose and are open source.

Using similar data model, data collection and data distribution processes to those used by

MixMarket.org could reduce the challenges outlined above and help create a transparent and open

data collection and publication effort for the European (or global) crowdfunding sector.



Figure: Example of a Microfinance institution factsheet on MixMarket.org

About XBRL (source : Wikipedia)



XBRL (eXtensible Business Reporting Language) is a freely available and global standard for exchanging business information. XBRL allows the expression of semantic meaning commonly required in business reporting. The language is XML-based and uses the XML syntax and related XML technologies such as XML Schema, XLink, XPath, and Namespaces. One use of XBRL is to define and exchange financial information, such as a financial statement. The XBRL Specification is developed and published by XBRL International, Inc..

XBRL is a standards-based way to communicate and exchange business information between business systems. These communications are defined by metadata set out in taxonomies, which capture the definition of individual reporting concepts as well as the relationships between concepts and other semantic meaning. Information being communicated or exchanged is provided within an XBRL instance.

Early users of XBRL included regulators such as the U.S. Federal Deposit Insurance Corporation and the Committee of European Banking Supervisors (CEBS). Common functions in many countries that make use of XBRL include regulators of stock exchanges and securities, banking regulators, business registrars, revenue reporting and tax-filing agencies, and national statistical agencies.

A wiki repository of XBRL projects is available to be freely explored and updated.In 2010, the Securities and Exchange Commission(SEC) in the US, the United Kingdom's HM Revenue & Customs (HMRC), and Companies House in Singapore had begun to require companies to use it, and other regulators were following suit. The SEC's deployment was launched in 2010 in phases, with the largest filers going first: by 2013, the large foreign companies which use International Financial Reporting Standards (IFRS) were expected to submit their financial returns to the SEC using XBRL. In the UK in 2013, both HMRC and Companies House accepted XBRL in the iXBRL format. XBRL was also adopted by the Ministry of Corporate Affairs (MCA) of India for filing financial and costing information with the Central Government.

5.3.2. Open Call for Technology Providers

For the purpose of defining suitable tools and interested parties for a full-scale pilot, an Open Call for

Technology Partners was launched in January 2014. The aim of this call was to assess the technical

ability and willingness from market participants to implement a (near) real-time data collection and

publication system. This specific task was delegated and realised with the support the European

Crowdfunding Network AISBL. The ECN has published this Open Call and has asked its Directors to

disseminate the requirement in the market and, was also widely promoted on the Associations’

social networks. The call was also published and promoted via the project website.

The Open Call for Technology partners displayed no specific technical budget for maintenance or

implementation and detailed the required input as follows:

Data Collection

Data collection can be made with different technologies and with different level of

contributors’ agreements. There are mainly two technology enabling for data collection:

- API: Automatic data load

- File data load: Data load through data file (e.g. .csv file)


http://en.wikipedia.org/wiki/Semantics#Computer_science

http://en.wikipedia.org/wiki/Business_reporting

http://en.wikipedia.org/wiki/XML

http://en.wikipedia.org/wiki/XML

http://en.wikipedia.org/wiki/XML_Schema_(W3C)

http://en.wikipedia.org/wiki/XLink

http://en.wikipedia.org/wiki/XPath

http://en.wikipedia.org/wiki/XML_namespace

http://en.wikipedia.org/wiki/XBRL_International

http://en.wikipedia.org/wiki/Metadata

http://en.wikipedia.org/wiki/Taxonomy_(general)

http://en.wikipedia.org/wiki/Business_reporting

http://en.wikipedia.org/wiki/Semantic

http://en.wikipedia.org/wiki/XBRL#XBRL_Instance

http://en.wikipedia.org/wiki/Federal_Deposit_Insurance_Corporation

http://en.wikipedia.org/wiki/Committee_of_European_Banking_Supervisors

http://en.wikipedia.org/wiki/Securities_and_Exchange_Commission

http://en.wikipedia.org/wiki/HM_Revenue_%26_Customs

http://en.wikipedia.org/wiki/Companies_House

http://en.wikipedia.org/wiki/Ministry_of_Corporate_Affairs


Data collection can also performed manually through evaluation, estimates and expert

interviews.

While Automatic data load with API carries evident advantages in terms of work burden and

standardization of data input, it is also the most difficult to implement technically. Moreover,

not all crowdfunding platforms technically enable or provide API data load functionalities.

When API data load is possible it can be done with different types of agreements with

contributors (crowdfunding platforms):

- Explicit agreement from provider for data access

- Implicit agreement from provider with data access from the provider public platform

The amount and scope of data variables will largely vary across crowdfunding platforms and

therefore there are very few players capable of pulling data on an industry wide basis. To our

knowledge existing data collection platforms available are still being in development phase

and are all operated by private companies. Data collection platforms have to define

commercially viable activities in order to break even on the cost of the data system

development, implementation and operation.

For the purpose of our data collection exercise we have relied on a manual data collection in

order to cover a large scope of the internet industry and the largest part of Europe. Our

approach comprise a combination of data gathering from platforms published data and

estimates where the data was not available.

Data publication

Data publication implies that two main conditions are gathered:

1. Data collection is complete

2. Data is reformatted into a single homogeneous and comparable data set

Since data formats available from the different contributors (platforms) are non-

homogeneous, a significant workload is implied in cleaning and aligning data formats. Data

completeness is also very complex to assess and achieve since many market players do not

currently provide data.

In the Open Call for Technology providers from the European Crowdfunding Network, data

collection requirement were expressed in the following terms:

Infrastructure

The required technology infrastructure will enable data providers to submit and control data

into a centralized database. The infrastructure should be available over the internet and

require minimal installation from the staff. The environment should have minimum security

requirement and backup functionalities to secure the operational process.



Data Gathering interface

The technology should enable data providers to easily submit their data. They should have a

secure access and an easy way to identify their dataset for further analysis (e.g. a specific

source variable that is automatically updated during the data load).

The number of data providers is expected to be between 10 and 100 providers.

The technology provider is expected to present such data gathering interface and

their suitability and ease of use.

Data formats should be at minimal .csv files; and if possible .xls / .xlsx files. Any

additional data connector will be a plus.

Database structure

The database structure should follow a similar structure to the following (minor changes may

apply on the taxonomy details):

Project related variables:

Amounts raised (in EUR)

Finance type (equity, debt, …)

Overall valuation (in EUR)

First round of finance

Previous round of financing

Amounts previously raised, within past 3 years (in EUR)

Country of operations

Country of fundraising

Industry

The taxonomy utilizes a unique sector and industry classifications taxonomy that has been

optimized for entrepreneurs and SME characteristics with input from a related workshop with

stakeholders in 2013 and research undertaken by ECN.

Crowdfunding / Fund Raising Platform related variables

Detail on volume, transactions, status, valuation

Real-time offering and investment commitment updates

Further information on the data structure / taxonomy may be found here, with details to be

confirmed in due course of the assignment:



http://www.crowdfundingnetwork.eu/2013/08/proceedings-of-the-high-level-workshop-on-

crowdfunding-and-web-entrepreneurship/

Although, the ECN will provide a final list of variables for implementation; database structure

and variables should be able to be changed at a later stage. Flexibility remains crucial until

the data gathering process has been started with data providers.

User interface and data access

Once submitted, data points should be accessible and editable in an easy manner by non-

technical users. There should be a dedicated user interface for accessing data.

Some data may be confidential and therefore permission right are expected to be

implemented per type of user and per variable (.e.g. some user types should not have access

to specific data sets or variables).

Data retrieval and exports should be able to be monitored on a per user basis.

Data Rendering and Analytics

There should be Data Visualisation tools and functionalities. The minimum requirements is

to be able to produce regular measures (average, percentiles, correlation, …) over the entire

dataset and to be able to identify inconsistencies or missing data.

Data can be normalized before the analysis process, enriched and distributed to various

channels. Enterprise search platform provides advanced search for tools such as screeners

supporting free text, geospatial, faceted classification, etc.

Dataset should be easily sub-divided per data provider or specific variables in order to ensure

meaningful analysis.

The Technology provider should detail in which ways data may be distributed

Guidelines over data anonymity should be provided to Data providers (e.g. names of

specific projects, specific information should not be available in other forms then

averages or analytic measures)

Proprietary indexes for benchmarking : Proposal from the Technology provider is a

plus

Administration & Maintenance

Users should be able to be created (with related permissions levels) by one or several

administrators. Admin right should be granted to the Open call management.

5.3.2.1. List of Technology providers answering the Open Call

As explained before the Open Call for Technology Providers issued during the project (the call was

issued on the project website and more widely circulated by the European Crowdfunding Network


http://www.crowdfundingnetwork.eu/2013/08/proceedings-of-the-high-level-workshop-on-crowdfunding-and-web-entrepreneurship/

http://www.crowdfundingnetwork.eu/2013/08/proceedings-of-the-high-level-workshop-on-crowdfunding-and-web-entrepreneurship/


AISBL) gathered many interested parties. Here are those players who have applied to implement a

Pilot system for Data Collection and Data Distribution, in alphabetical order:

CrowdScanner Ltd. (contact : Franck Zeitoun)

Innovation Service Network (ECN Member, contact : Reinhard Willfort)

Open Data Soft (contact : David Thoumas)

Symbid consortium (ECN Member, contact : Korstiaan Zandvliet)

The Web Financial Group / Crowdnetics) - (contact : Luan Cox)

5.3.2.2. Conclusion on the Open Call for Technology providers

The initial analysis of replies, which was based on an independent review from the projects advisory

board, from the Technology Providers shows that many of them offer not only a role of IT providers

but also pursue their own commercial agenda in this sector. While this is understandable, since the

required system development have to be covered in some ways, it renders the choice and agreement

process very complex. We foresee difficulties to invite crowdfunding platforms to contribute data

openly into a system that will be used for commercial purposes by a third party. The collective

advantage and benefits of the data collection have to be clearly identified before being able to

conduct such a large scale project (with potentially more than 80 contributors in Europe).

While it could be possible to entirely rely on a single technology provider for the purpose of this

exercise we have also seen that other players have engaged in similar developments and requests

with the contributors themselves, rendering the data collection exercise complex, fragmented and

often resulting in duplication.

Here are the main hurdles that we have faced in the defining the roadmap for implementing a data

collection & data distribution system:

- Implementing the system and maintaining it requires significant efforts and resources

(infrastructure, developers, project management, …)

- Interfacing with the data collection system and providing the data comes at a significant

financial and opportunity cost for most of the contributors (crowdfunding platforms)

- Other data collection and data distribution system providers have already engaged with our

targeted contributors; creating competing redundant data requests and risk of undue

double-usage.

- A single data model / taxonomy do not exist and still need to be defined

- Definition of what data would be available for commercial purposes by the Technology

Provider or by the system operator itself

- In the short term, manual collection of heterogeneous data generates a very cumbersome

data alignment, retreatment and data verification burden. Moreover creates incomparable

datasets.



In order to be exhaustive at this point in time, we see that all potential sources of data would have to

be tapped into, amongst which:

- Some specific private data factories / data collection system having already defined formats

and processes with some contributors

- Direct access to data sets from contributors

- Top-down approach from estimates and provisory data collected on alternative data sources

(legal accounts, company analysis, website, interviews …)

We see the best solution for enabling exhaustive, comparable and accurate data collection is to

define common data standards and models; as well as to provide an eco-system that is incentivizing

the data remittance in a correct format and in timely manner.

This exercise as helped clarify a number of actions need to be carried out before the Pilot System can

be implemented and the first data be collected:

- Provide incentive, financial resources, and guidelines for the data remittances from

contributors

- Provide incentives and specific mechanisms that will ensure exhaustive data gathering

- Define the Data model to be used in such a system (both for data collection and for data

distribution)

- Carry out the implementation of the system and the data collection interfacing as a

stand-alone global Project (with appropriate resources and objectives)

- Provide a model that fosters all players and enables private companies to be part of the

economic model for data collection and data distribution

- Define guidelines and standards for data usage



5.4. Taxonomy We envision that the several different types of stakeholders will find the taxonomy useful in their

activities. Different usages may be envisioned.

For example, the European Commission might want to define and organize actions pertaining to

crowdfunding in Europe according to the different users, market segments and sub-funding types

defined. It might also want to carry further analysis to define the most likely path of action in order

to foster favourable conditions for this new type of funding for web entrepreneurs.

Web entrepreneurs and ICT startups will find it useful to define their own funding strategy. They can

use the taxonomy as a way the refine action plans and define the most suitable market segment and

funding source for their project. Once more data is available, web entrepreneurs may also define the

specific investor’s requirements and market dynamics applying to their specific product and market

segment.

Investors rely on both analysis and benchmarking when making an investment decision.

Understanding the funding strategy of a particular project enables to define its inherent risks and

potential returns. Combined with analytic capabilities and data, it can become a key tool for the

financial investors.

Public Bodies need to base their analysis and actions on actual definitions applicable to the specific

sector concerned. Crowdfunding has an impact on different types of activities including supervision,

users’ interests and incumbent actors’ interest. The taxonomy should enable them to define and

monitor specific developments relevant to their agenda. For instance, a supervisor could seek to

assess the usage (and compliance) of a particular type of funding in a specific market and draw

actions depending on their findings.

The present section provides an introduction on the contextual information for this taxonomy and

the way it was defined for the Startup Europe Crowdfunding Network. It also provides an analysis of

the artifacts used to define the present taxonomy: the workshop proceeds (including experts input)

and a complimentary analysis from existing crowdfunding platforms’ data models. Finally it presents

the taxonomy itself in a readable format for the non-technical professional.

Although we envision that this proposal will open a certain way for defining a taxonomy, we would

like to mention that some other crowdfunding data model and or taxonomy initiatives are already, if

with limited impact, under way. We do not differentiate those initiatives that are commercial from

the non-commercial in nature.

Here below is a list of initiatives that included the creation of a taxonomy for the purpose of

crowdfunding projects reporting & analysis. This list is not deemed inclusive and is for information

purpose only.

The Crowdfunding Center

The Web Financial Group / Crowdnetics

CrowdScanner Ltd.



Banque Publique d’investissement (BPI France) / Tousnosprojets.com website

Symbid consortium

5.4.1. Scope & Definitions

This taxonomy has been defined in the framework of the Startup Europe initiative. Its scope spans

web startups and entrepreneurial projects that seek for funding in the framework of their product

conception, prototyping or development. The taxonomy is specifically relevant for web

entrepreneurs for which specific variables and dimensions have been integrated. In practice, the

scope was defined with input from the relevant interest groups and the sector experts in order to

define the taxonomy.

As a definition applicable to web entrepreneurship, a taxonomy is the technical term for the guiding

principles behind the organisation of information - a key concern for web developers. Every web

developer should know how to harness the basic principles of taxonomy to design a logical,

organised, efficient Web infrastructure. By understanding information taxonomy and using it to

optimise websites, web developers can maximise the value and capability of their work. Taxonomy

structure provides a classification schema for categorizing content within the content management

process. (Source : ZDnet.com)

The content of the taxonomy is entirely summarized in this section. The taxonomy is built upon a list

of variables previously defined. Notice that some variables have not been selected to be part of the

final proposed taxonomy.

There are additional measures (identified in the first phase of the project, especially through the

Workshop held in Brussels on 4 June 2013) that have been considered as too complex to implement

or purely analytical measures that can be derived from the main data model. These measures have

not been included in the presented taxonomy. Please note that a full-fledged data model would also

require single points of entry and unique identifiers for the data tables articulation. These have not

been included in the taxonomy as it covets a technical dimension.

For some variables, a list of possible values is provided for information. These are for information

purpose and are not considered exclusive, nor as a definitive reference.

5.4.2. Context & Usage

Business context is the business environment for the taxonomy efforts in terms of business

objectives, web applications where taxonomy will be used, corporate culture, past or current

taxonomy initiatives, and artifacts within the organization and across the industry.

5.4.2.1. What is the purpose of the taxonomy?

The taxonomy is a tool and a set of definitions enabling other initiatives and action monitoring in the

framework of the Digital Agenda pertaining to the Startup Europe initiative. It should support and be

used by the related actions in promoting web and ICT entrepreneurs to start their business in Europe

and to let them flourish in Europe. More specifically to define the early stage finance that use



crowdfunding. As this is a rather new and un-documented type of funding resources for

entrepreneurs this taxonomy should help the different stakeholders of the web and ICT industry to

define, foster actions and measure on them.

5.4.2.2. Who will be using the taxonomy?

Withstanding that it will be dependent on its actual refinement, integration and publication by the Directorate itself, different stakeholders will find the taxonomy useful:

The European Commission/Directorate General (DG)

Web entrepreneurs and ICT startups

Investors

Public bodies / Supervisors

5.4.2.3. How is the taxonomy going to be used?

We envision that the several different types of stakeholders will find the taxonomy useful in their activities. Different usages may be envisioned:

For the European Commission: Define and organize actions pertaining to crowdfunding in Europe according to the different users, market segments and sub-funding types defined. Carry further analysis to define the most likely path of action in order to foster favorable conditions for this new type of funding for web entrepreneurs.

For web entrepreneurs and ICT startups: Web entrepreneurs and ICT startups will find the taxonomy useful to define their own funding strategy. They can use the taxonomy as a way the refine action plans and define the most suitable market segment and funding source for their project. Once more data is available to them; web entrepreneurs may also define the specific investor’s requirements and market dynamics applying to their specific product and market segment. Another aspect of the taxonomy refers to the market opportunities in developing ICT activities when a particular data model and taxonomy is shared amongst a potentially large finance market such as crowdfunding.

For investors : Investors rely on both analysis and benchmarking when making an investment decision. Understanding the funding strategy of a particular project enables to define its inherent risks and potential returns. Combined with analytic capabilities and data, it can become a key tool for the financial investors.

For other public bodies / Supervisors / NGOs : Public Bodies need to base their analysis and actions on actual definitions applicable to the specific sector concerned. Crowdfunding has an impact on different types of activities including supervision, user’s interests, incumbent players associations … The taxonomy should enable them to define and monitor specific developments relevant to their agenda. For instance, a supervisor could seek to assess the usage (and compliance) of a particular type of funding in a specific market and draw actions depending on their findings.

5.4.2.4. What are the input sources for the taxonomy design?

The taxonomy design has relied mainly on (1) a high-level expert workshop and (2) expert input

gathered for the specific purpose of the taxonomy design. The iterative process of the taxonomy

building enabled both workshop participants and the advising board to provide input where

required. Please see section (2) for more details about the existing artifacts analysis for inputs.



5.4.3. Artefacts analysis

5.4.3.1. High Level workshop proceeds & Expert review

As described in the document «Proceeding of the High Level Workshop on Crowdfunding & Web

Entrepreneurship» published in August 2013, the workshop and expert review process enabled also

to define the most important dimensions that the taxonomy should cover. As an output from this

process, the summarized elements of the taxonomy should comprise the following:

From section 4. “Crowdfunding as a source of alternative financing” pp.13-15 in the

document :

Hard Facts Data (on Projects / Entrepreneurs):

o Revenues, Profits

o Number of Employees

o Year Established

o How many customers

o Share of business of 20% most active customers

o Returning customers

o Financial History and Forecasts

o Shareholders

o Intellectual Property (Patents, Brands, domain name, etc.)

o Major commercial contracts

o Founders degrees

o Awards/achievements

o Recommendations

o Social Media links

Soft and Subjective Facts Data (on Projects / Entrepreneurs):

o Professional Investors Question Catalogue and Guide (Venture Capital,

Business Angels)



o Links to external resources

o Wikipedia, major articles, books, competition

o Wikipedia-like resource filled by crowdfunders

o Competitor list (with links), competitor’s failure and success stories,

market trends

Post-mortem analysis of questions, rating, to have a permanent learning

process:

o Most Frequently Asked Questions

o Favourite Questions by Investors

o Favourite Questions by Entrepreneurs

o A ranking of reviewers and opinion makers linked to public profiles

o How many investments they made? Where? Success rate?

o What other reviews they did?

o What is their business and educational background

From section 7. “Open Data & Transparency”, p26-30 in the document :

1. Data processing lines

The crowdfunding platforms as part of their daily operations request and receive data

both from Entrepreneurs and from Investors. The data received can be categorised as

public or open data and as private or restricted data. Open data should be used for

transparency reasons on each crowdfunding site itself, but also provided a central

intermediary. Restricted data should be forwarded to such intermediary who would

make sure no infringements of right would be made by using the data in aggregated

fashion. The intermediary would use all data to analyze the market. Where necessary,

the Intermediary also could be responsible to forward restricted data to official

authorities, such as the tax authority.



2. Specification of existing data

Data in connection with the Entrepreneur (*considered restricted data):

o Name*

o Age

o Gender

o Location

o Company Name

o returnin

o Tax Number*

o Number of Chamber of Commerce

o Crowdfunding Period

o Crowdfunding Target Sum

o Sector

Data in connection with the Investor:

o Name*

o Age

o Gender

o Income*

o Location

o Type of Investment

Data in connection with the Type of Investment:

o Date of Investment

o Amount of Investment



Following up on the specification of available data a wish list of additional data can

be set up in order to create an overview of the kind of data that should be provided

additionally in a live feed. Data can be attributed to the categories

Entrepreneur/Project, Platform and Investor/Funder. A distinction can be made in

each category between data applying to a short-term and/or a long-term data feed:

3. Data wish list: Entrepreneur/Project

Short-term:

o Age

o Gender

o Area and Sector

o Spinoffs

o Location

o Other Sources of Finance

o Way of Presentation

o Fee

o Interest Rate

Long-term:

o Reporting of Project

o Fulfillment Data

o Success

4. Data wish list: Platform

Short-term:

o Profit Margin

o Operating Cost

o Location

o Qualification



o Secure Communication

o Business Model

o Legal Structure

o Language

o Contract Types

Long-term:

o Protection of Investor and Entrepreneur

o Verification

o Member in an accredited trade Association (e.g. ECN)

5. Data wish list: Investor/Funder

Short-term:

o Age

o Gender

o Income-Range

o Type of Investor (Individual/Institution)

o Geographical Location

Long-term:

o Tax situation

5.4.3.2. Crowdfunding platforms : Additional dimensions

Introduction

In order to define the detailed taxonomy variables and dimensions, we have conducted additional

analysis on a random sample of crowdfunding platforms active in the various main types of

crowdfunding (1. Donations, 2. Reward-based, 3. Equity, 4. Debt). This analysis enabled to define

further some specific dimensions that would not have identified in the previous design process.

Remarks: This analysis is to be understood as complementation to the initial taxonomy design. It has

be conducted with the objective to be as exhaustive and complete as possible with regard to the

purpose of the work package and potential usage of this taxonomy.



Nevertheless, this complimentary analysis carries some limitations:

- Other types of crowdfunding that are not mainstream (such has hybrid forms of funding, or

revenue sharing securities) have not been considered

- Differences in the regulatory requirement imposed by national legislations have not been

taken into account.

- IT related or technical variables used for platform operations have not been considered

Donations crowdfunding platforms: Additional dimensions / variables

Campaign variable added: Tax deductible

Tax deductibility is an important driver of donations-based platforms. Therefore we have

added this variable. It defines whether a particular campaign yields to tax deduction for the

target contributors. If the campaign is open to both Individuals and Companies, or even to

contributors in all countries, it should be tax deductible to all possible campaign contributors

to be considered as tax deductible.

Tax deductibility will provide fuel to crowdfunding platform in the long term as it provide

incentive to be involved and finance community projects; or those projects that fulfill a

particular policy agenda.

Reward-Based crowdfunding platforms: Additional dimensions / variables

Campaign variable added: Campaign period (Actual)

Campaign variable added: Campaign period (Planned)

A set of two additional variables have been added to assess the dynamics of the

crowdfunding campaign in terms of campaign period impacts on other variables (e.g. Total

Amounts raised, Audit Status, or other metrics). The variable Campaign period (Actual) can

also provide insights in the impacts from Entrepreneur / Company characteristics on possible

discontinuations of campaign against the Campaign period (Planned). As an absolute

measure, it can also help define explanatory variables on the differences often encountered

in reward-based crowdfunding.

Campaign variable added: Campaign Trigger

Some reward-based campaigns do display a minimum amount to be reached in order for the

fund transfer to be completed between the contributors and the entrepreneur / company.

This particular threshold needs to be captured in the taxonomy in order to make further

analysis and define potential impacts on other variables (most obviously on the campaign

success itself). For a campaign in “all-or-nothing mode”, this amount will equal the Campaign

Target. For a campaign run with continuous contributions, this Campaign Trigger variable will

be 0.

Equity & Debt crowdfunding platforms: Additional dimensions / variables

Project variable added: Total Project Funding Amount



For financial investment, having an indication of the total project funding requirements is a

first key step to understand the proportion of funding (and therefore the potential risk)

sought after crowdfunding investors. The Total Project Funding Amount can be higher than

the Target Amount sought on crowdfunding platform. For instance, for equity crowdfunding

campaigns the Total Project Amount will be equal to the capitalization (value of all shares) at

the same valuation for the equity crowdfunding campaign.

5.4.4. Data Groups

When analyzing both the proceeds from the High Level workshop and the experts review process, we

can draw five categories of variables defining the crowdfunding activity:

ENTREPRENEUR / COMPANY

PROJECT

CAMPAIGN

INVESTOR / CONTRIBUTOR

CF PLATFORM

The variables have been derived and summarized and presented here below within a global

structure. In general practice, the overall relationship between the different variables group are as

follows :

Some remarks about cases were data groups may be assimilated. For instance, an equity

crowdfunding project carries the same nature as the entrepreneur / company itself, which means

that the characteristics of the “Project” and the “Entrepreneur / Company” will be merged to a

certain degree. Also, potential relationships between variables have not been fully defined and

documented (as a multi-dimensional presentation tools would then be required).

Further in this document, variable codes are provided for the ease of reading, based on this format:

#XXXX

Project

Campaign

Entrepreneur / Company

Investor / Contributor

CF Platform

1 n

1 n

1 n (practice)

n n (theoretical)

1 n (practice)

n n (theoretical)



The first digit defines the level of the variable and dimension described. When first digit is “1” means

it is a topline definition, when first digit is “2” it means it is a sub-definition or sub-dimension of a

specific level 1 value; and so forth. Following four digits have been generated in a purely ad hoc basis.

The last field Recommended restricted access stands for those variables that could be collected by a

central body, however not be publicly available for certain Projects or certain Contributors.

Nevertheless there may be aggregated or non-nominative analysis published.


5.4.4.1. Data Group : ENTREPRENEUR / COMPANY

Code Variable Label Level Unit Description / Meaning Recommended

restricted access

1ENTP Entrepreneur Type 1 Individual / Company This variable defines the beneficiary of a campaign;

whether it is a legal entity or a natural person. No

1ENLO Primary Location 1 City Primary location of the entrepreneur or the company No

2ENTX Tax Number* 2 Number Only applicable for a Company (legal entity) Yes

2ENRE Number of Chamber of Commerce 2 Number Only applicable for a Company (legal entity) Yes

2ENAG Age 2 Year of Birth Only applicable for Entrepreneurs (natural persons) No

2ENGE Gender 2 M / F / Other Only applicable for Entrepreneurs (natural persons) No

2ENEN Number of Employees 2 Number Only applicable for a Company (legal entity) No

2ENIC Income (Individuals) 2 Euros Only applicable for Entrepreneurs (natural persons) : Gross

Income Yes

2ENRV Revenues (Companies) 2 Euros Only applicable for a Company (Legal Entity) : Last years

Revenues No

2ENPF Profit & Loss (Companies) 2 Euros Only applicable for a Company (Legal Entity) : Last years

Profit & Loss No

2ENSH Shareholders (Companies) 2 Main Shareholders list Only applicable to Company : List of Main Beneficiaries Yes

2ENYE Year Established (Companies) 2 Year Year in which the company has be founded or registered, if No

19 April 2014 www.crowdfundingnetwork.eu Page 65

it is a company that does a crowdfunding campaign.

5.4.4.2. Data Group : PROJECT related


restricted access

1ENLO Primary Location 1 City - No

1PJDE Founders degrees 1 Value list

Not specified Lowest level of degree from the Entrepreneurs / Company (when

individuals) No

1PJCO Customers number 1 Number N umber of customers (or amount of engaged community) when

starting the crowdfunding campaign No

1PJIC Intellectual Property (Patents, Brands, domain name, etc.)

1 Not Specified Qualitative information about the intellectual property that the

project embeds or uses (at the start of the crowdfunding campaign)

Yes

1PJCM Major commercial contracts 1 Not Specified Qualitative information about the major commercial contracts

that the project embeds or uses (at the start of the crowdfunding campaign)

Yes

1PJOF Other Sources of Finance 1 Yes / No Indicator about the presence of other sources of funds for the

project (at the start of the crowdfunding campaign). No

1PJAM Total Project Funding Amount 1 Amount (in Euros) The total budget for the project. If it is the company, the

shareholder equity value. No

1PJSE Sector 1 Value List

Unspecified Sector of activity of the project. Product / Services nature No



2PJSS Sub-Sector 2 Value List

Unspecified Sub-Sector of activity of the project. Product / Services nature.

Additional level of detail depending on the Sector variable No

1PJSO Social Media links 1 Text String The links to the social media profiles Yes

1PJSI Spinoff / Startup 1 Dummy Variable (Spinoff /

Startup)

This variable indicates whether the project is managed or spun off out of an existing company. If it is a new project with an individual

entrepreneur then it will be a Startup. No



5.4.4.3. Data Group : CAMPAIGN related


restricted access

1CPTP Campaign type 1 Type of investment : List of

possible values Donations; Reward-Based; Equity; Debt; Other Financial ; Other

Non-financial No

1CPPP Campaign Period (planned) 1 Days Length in days during which the Crowdfunding campaign is

supposed to last (at the date of the launch) No

1CPPA Campaign Period (actual) 1 Days Length in days during which the Crowdfunding campaign has

actually lasted in reality. No

1CPTA Campaign Target 1 Euros Amount in Euros that is displayed as a target amount to raise on

the project. No

1CPTR Campaign Trigger 1 Euros Certain amount that will trigger the Fund transfer (See Variable "Amounts Transferred"). Per default is equal to the Campaign

Target, but can be different No

1CPAR Amounts raised 1 Euros Actual or pledged amounts from the contributor. The Variable "Amounts Transferred" defines whether the campaign is been

liquidated in to the benefit of the Entrepreneur / Company No

1CPAT Amounts transferred 1 Yes / No This is a proxy in order to define whether the campaign was

successful. No

1CPNI Number of investors / contributors 1 Number Number of contributors until campaign is closed (regardless of its

actual Transferred amounts) No



1CPAV Average Fee 1 Average % commission cost The average cost (incl. Taxes) that has been charged by the

platform (on the amounts raised when Amounts transferred ; on the Campaign Target when the Amounts are not transferred)

No

1CPAF Fee Amount 1 Commission cost (in Euros) The exact Amounts charged to the campaign by the crowdfunding

platform (incl. Taxes) Yes

2CPIT Interest Rate 2 Interest rate (p.a) Only applicable to loans No

2CPTD Tax deductible 2 Yes / No When the contribution is tax deductible for the contributor. This

indicator is set to "Yes" No

2CPST Status 2 Values : Completed / Ongoing / Defaulted /

Transfered This is the status of the current project. No

2CPIN Investors / Contributors names 2 Text String List of investors / contributors names. If possible with related

amounts pledged or transferred (see variable "Investors / Contributors pledges)

Yes

2CPPL Investors / Contributors pledges 2 Amount String (in Euros) Details of investors / contributors pledged amount. If possible

with related names (see variable "Investors / Contributors names) Yes

2CPRE Reviews linked to public profiles 2 Text String Qualitative data input from reviewers and opinion makers input

about a specific project No

Variable Code : 1CPTP

Label : Campaign Type



Detail : The type of support provided by a contributors into a specific project or product / services development initiative. It is defined regardless of the type of project holder it can be a

financial or non-financial support.

Value Code Label Description

P Donation Philanthropy based funding. The contributor does not expect a financial or tangible return on his financial support

R Reward-Based Funding based on the acquisition of a benefit that may be tangible of intangible. The reward has to be delivered by the project holder

(immediately or in the future).

E Equity Funding is provided against straight equity shares in a company, or a management entity.

D Debt Funding is provided against a debt claim on the company. The debt may carry interest or not.

O Other Financial Other types of funding including participative debt, convertibles debt, revenue sharing agreements, …

S Other Non-Financial Other types of support (marketing, field activities, work contribution, …) that does not involve an immediate or differed financial

contributions into a crowdfunding campaign. Remark : Some variables such as Amount may not apply for this type



5.4.4.4. Data Group : INVESTOR / CONTRIBUTOR related


restricted access

1COTY Investor Type 1 Individual / Company / Not

for profit / Government The type of contributor for a crowdfunding campaign No

2COTA Age 2 Year of Birth - No

2COTG Gender 2 M / F / Other - No

2COIR Income / Revenue 2 Euros Gross global income for individuals / Gross Turnover for

companies No

1ENLO Primary Location 2 City - No

1COAI Amounts invested (per platform) 1 Euros

Structure Unspecified Analytic measure of the total amount invested (where amounts

transferred) for each platform No

1COIN Number of investments made (per platform)

1 Number

Structure Unspecified Analytic measure of the number of campaigns participated (where

amounts transferred) for each platform No

2COIS Total number of investments made to date

2 Number Analytic measure of the total number of campaigns participated

(where amounts transferred) for all platforms No

2CODE How many investments defaulted 2 Number Analytic measure of the number of investments where the project

defaulted (See variable "Status") No

2COLF Most frequent investment location 2 City The specific city that gathers most investment contributions (in

number of campaign contributed) for a single contributor / company

No

2COLN Number of invested locations 2 Number The number of different cities where projects are based and have

No



been invested in

5.4.4.5. Data Group : PLATFORM related


restricted access

1PFCO Company Name(s) 1 List of Company names operating the platform

The legal entity that is operating the crowdfunding platform (or the legal entities names that are part of the crowdfunding

operator group). Yes

1PFBM Business Model 1 Text Description of the platform business model and services offering

(Qualitative information) No

1PFCF Campaign Types 1 See [Campaign Type |

Campaign] See [Campaign Type | Campaign] No

2PFCT Contract Types 2 Not Specified Depending on the Campaign types : Defines the types of financial

contracts offered to contributors No

1PFOP Countries of operations 1 List of countries Countries where the companies is taking contributions from

Investors / Contributors No

1PFLO Headquarter location 1 Country The Country of the main offices of operation. If not available the

country of the main operating company. No

1PFLA Languages 1 Languages Values Languages in which the crowdfunding platform website

operates No



1PFLE Legal Structure 1 Not Specified Legal structure of he headquarters company. When several

companies form a group a string of values could be provided.

No

1PFTA Member in an accredited trade Association (e.g. ECN)

1 Yes / No - No

1PFAS Names of Associations 1 Text String The names of the different Association the platform is

affiliated to No

1PFOC Operating Cost 1 Euros Direct Operating Costs generated by the crowdfunding

platform activity. Based on declaration from the crowdfunding platform

Yes

1PFPF Profit 1 Euros Direct Operating Costs generated by the crowdfunding

platform activity. Based on declaration from the crowdfunding platform

Yes

1PFPT Protection of Investor and Entrepreneur

1 Not specified Qualitative information on the level of protection provided

by the crowdfunding platform. (Due diligence processes, guarantee funds, additional risk reduction measures,…)

No

1PFLI License 1 Text Qualitative information on whether a platform possesses a valid license or mandate from supervisory body to conduct

its activity No

1PFSC Secure Communication 1 Indicator

Not specified Measure of the IT security surrounding the platform, in all

its locations of operations No

1PFAU Audit status 1 Indicator

Not specified Qualitative information related to the audit status of the

operating entiti(es) No


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