Crowdfunding Comparison – The New Business Opportunity

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Forbes | Trevor Clawson |Nov 28, 2014

UK aggregator Nurturemoney“We are on the edge of something that is currently quite small but which has the potential to grow much, much larger.”

So says Richard Watts, founder and CEO of Nurturemoney.com, a newly minted aggregation website styling itself as the UK’s first independent comparison platform for the ever-expanding crowdfunding and peer-to-peer lending market.

Launched in mid-November and with 1,600 uses already registered, Nurturemoney has been designed to appeal both to investors and to businesses seeking cash to their projects. By pulling together information from a broad range of rewards, equity and debt-based crowdfunding platforms, the company offers a means to make a direct comparisons between the various players in terms of the rates on offer, the levels of funding typically provided and the most common business profiles.

Growing Complexity

Arguably the growing  complexity of the UK Crowdfunding market cries out for aggregators and information providers who can help investors and businesses make sense of the options available.

For instance, on the investment side of the equation, most newcomers to the market will probably have pre-decided whether their interested lies  in equity investment or making a peer-to-business loan, while others will be content with donation in return for a reward. But once they’ve made that choice, they face the task of a sifting through maybe a couple of dozen players within their preferred section of the market and weighing up what each as to offer. A would-be lender will want to know about the rates on offer, the timescales and the types of company that typically raise cash.

Meanwhile, fund-raising companies face a parallel research process as they try to identify the equity or lending platforms that will be most responsive to their pitches.

And within the broad ‘equity,’ ‘debt,’ ‘invoice trading,’ and ‘rewards’ categories, no two crowdfunding platforms are quite the same . For instance, in the equity sector, the likes of Crowdcube, Seedrs and Syndicate room each have a different approach to investor relations issues and to some extent cater for different types of investor.

Then there’s innovation. Over the last year or so, crowdfund and P2P pending platforms have sought to differentiate themselves either by targeting specific sectors such as renewable energy. Equally platforms are seeking to extend their appeal by  by introducing new products or features, such as equity-platform Crowdcube’s recently launched mini-bonds.  Meanwhile on the debt side, there have been efforts to de-risk lending. Assetz Capital has introduced a system of asking borrowers to put up security, while Lending Works, includes insurance doe lenders.

View:  Rise of Peer to Peer Business Lending in the UK

In other words, this is a shifting landscape making sense of the market is not easy, creating an opening for information providers.

Nurturemoney’s approach echoes that of a great many price comparison websites in other sectors. Investors and Businesses choose a funnel and then narrow down their options through a series of filters.   For instance, investors will choose drill down through questions such as: type of investment (equity/debt), country (UK, US, Germany), minimum investment,   fees and secondary market. The outcome is a list o suitable  providers with a clickthrough option to register with the appropriate platforms. At the moment, the purpose is to point users to suitable platforms and enable them to do some more in-depth research.

But it’s early days. “In a few weeks we’ll have live data from the participating platforms, providing information on the performance of platforms,” says Watts. “And we’re also introducing a function to let users rate the crowdfunders and make comments.”

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The National Crowdfunding Association of Canada (NCFA Canada) is a cross-Canada crowdfunding hub providing education, advocacy and networking opportunities in the rapidly evolving crowdfunding industry. NCFA Canada is a community-based, membership-driven entity that was formed at the grass roots level to fill a national need in the market place.  Join our growing network of industry stakeholders, fundraisers and investors. Learn more About Us | Support Canadian Crowdfunding.

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