Category Archives: Research

AI’s Impact on Competition: Bureau Calls for Insights

Consultation | March 20, 2024

Competition Bureau AI and Competition Discussion Paper 2024

Help the Competition Bureau Shape the Future of AI and Competition in Canada

The Competition Bureau of Canada has launched a discussion paper and consultation on the topic of 'Artificial Intelligence (AI) and Competition' and its implications for competition within the Canadian market, from the foundational aspects of AI to its impact on market structures and practices. There are 3 sections to the consultation with some specific questions to respond to.

Download the 27 page PDF 2024 Discussion paper on 'AI and Competition'

Part 1:  Introduction to Artificial Intelligence

This section contains AI's definitions and aims to establish a common understanding of AI from diverse perspectives including academia, industry, and governance.  By identifying emerging technologies and those of particular significance to Canada, stakeholders can help shape a regulatory framework that is both forward-looking and tailored to the unique needs of the Canadian AI sector.

Questions

  1. Are there any additional technologies, not included in the above list, that the Bureau should consider to advance its understanding of Artificial Intelligence?
  2. Are any of the identified technologies particularly significant to the AI sector in Canada?

Part 2:  Markets for Artificial Intelligence

This section covers the markets involved in the production of AI products and services, including AI infrastructure, development, and deployment. It highlights the importance of vertical relationships and access to resources like data and computational power, which are essential for innovation and competition in AI markets.

See:   DoF Consultation: Financial Competition in Canada

Understanding the competitive dynamics and the role of vertical relationships in AI markets as potential barriers to entry or areas where competition may be stifled. These insights can guide the Bureau in promoting a competitive environment that encourages innovation and ensures fair access to essential resources.

Questions

  1. What are the key factors that influence the competitive dynamics in the markets for AI infrastructure, AI development, and AI deployment?
  2. How do vertical relationships affect competition in AI markets?

Part 3:  AI and Competition

Section 3 examines how AI may affect competition in the context of Canadian law. It explores AI's impact on mergers, monopolistic practices, cartels, and deceptive marketing practices.  It also discusses the Bureau's role in working with policymakers to promote competition in AI markets.

See:  Canada’s Lagging AI Adoption Needs to Accelerate to Compete

By exploring how AI influences anti-competitive practices and identifying ways the Bureau can support a competitive AI market, stakeholders can contribute to developing policies that safeguard competition while fostering innovation.

Questions

  1. How might AI influence the Bureau's approach to identifying and evaluating anti-competitive practices?
  2. What role can the Bureau play in supporting the development of a competitive AI market in Canada?

Call To Action

This consultation represents a unique opportunity for stakeholders from all sectors to contribute to a critical discussion on the future of AI and competition in Canada. Your insights, experiences, and perspectives are invaluable in shaping policies that balance innovation with fair competition.

See:  Canada Aims to Regulate AI in Search & Social Media

By providing insights into these areas, stakeholders can help ensure that Canada's approach to AI and competition is both informed and effective, promoting a market environment that benefits consumers, businesses, and the economy as a whole.


NCFA Jan 2018 resizeThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Coingecko 2024 Report: Investing in Tokenized RWAs

Report | March 20, 2024

Coingecko 2024 RAW Report commodity backed tokens

Image: Coingecko 2024 RAW Report

Tokenized Real World Assets Surge as Crypto Investments Attract Investors

Coingecko has published a 2024 report on Real World Assets (RWAs), showing significant growth and diversification beyond fiat-backed stablecoins. With USD-pegged assets dominating the stablecoin market, the report also reveals a substantial rise in commodity-backed tokens (particularly gold), tokenized treasury products and demand for private credit by bridging traditional financial assets with the digital economy, offering enhanced liquidity, accessibility, and efficiency in asset management and investment.

See:  Citi’s PoC Success in Private Market Tokenization

Real World Assets (RWAs) refer to tangible or intangible assets that exist in the physical world and have intrinsic value, such as real estate, commodities, art, and financial securities. In the context of blockchain and cryptocurrency, RWA tokenization involves converting the ownership rights of these assets into digital tokens on a blockchain, facilitating their trade, ownership, and management in a secure, transparent, and efficient manner.  Tokenized RWAs are curating the landscape of crypto investments, offering a promising outlook for both retail and institutional investors.

  • In 2024, USD-pegged assets continue to dominate the fiat-backed stablecoin sector, accounting for 99% of all stablecoins. Tether (USDT) remains the market leader with a staggering market capitalization, highlighting the growing trust and reliance on stable assets within the crypto ecosystem.
  • The market cap for commodity-backed tokens has reached $1.1 billion, with gold-backed tokens like Tether Gold (XAUT) and PAX Gold (PAXG) making up 83% of this segment. This indicates a strong investor interest in tangible, value-storing assets within the digital domain.  See Canadian project:  Investors Launch Argo Digital Gold to Tokenize Gold
  • The tokenized treasury market witnessed a 641% growth in 2023, showcasing the increasing appetite for safer, yield-generating crypto assets. Franklin Templeton emerged as a significant player, issuing a substantial amount of tokenized US treasuries and capturing a notable market share.

See:  BoE Speech: 4 Areas at the Intersection of Payment Innovation, Tokenization, and Money

  • The demand for private credit within the crypto space has seen a notable concentration in the automotive sector. Out of the total $470.3 million in loans extended by private credit platforms, car loans account for 42%, amounting to $196.0 million. In contrast, the fintech and real estate sectors represent a smaller portion of the debt, comprising 19% and 9% of the outstanding loans, respectively.
  • Innovation continues: Lithuania-licensed crypto bank, Meld, in partnership with DeFi platform Swarm, plans to introduce lending and borrowing against tokenized RWAs, potentially revolutionizing retail investment strategies.

Outlook

As the crypto sector matures, the tokenization of real-world-assets is only a matter of time as the global investment paradigm democratizes assets to a broader range of assets for investors worldwide to create a more inclusive, efficient, and resilient financial ecosystem.


NCFA Jan 2018 resizeThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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The Global 50: Future Opportunities for Decision-Makers

Report | March 15, 2024

The Dubai Foundation 2024 The Global 50

Image: The Dubai Foundation, The Global 50, 2024

A Vision for the Future:  The Global 50

The Dubai Future Foundation has released its third report titled "The Global 50" providing a comprehensive exploration of the opportunities and challenges that lie ahead, aiming to inspire decision-makers, innovators, and communities worldwide.

The report envisions a future that is diverse and ever-changing, where global trends impact individuals and communities in myriad ways. It acknowledges the unpredictability of the next half-century, suggesting that while our concepts of growth, prosperity, and well-being may evolve, the fundamental human needs and motivations will remain constant. This vision encompasses a wide array of domains, including energy, health, governance, ecology, and more, highlighting the potential for universal access to energy, advancements in medical screening, and the emergence of digital and immersive realities.

Learning from the Pandemic

The recent global pandemic has unveiled the critical importance of focusing on the future, demonstrating the remarkable capacity of human innovation to respond to crises.

See:  Rising AI Energy Use: A Call for Sustainable Innovation

Innovations such as the rapid development of vaccines and the adoption of new technologies for remote work and communication have shown that, despite unforeseen challenges, we are capable of creating solutions that not only address immediate problems but also pave the way for a better future.

Future Opportunities for Decision-Makers

The report outlines several strategies for decision-makers to harness the potential of these future opportunities:

1.  Inspiration and Investment

Utilize the opportunities as a source of inspiration to identify new avenues for investment and value creation.

2.  Foresight and Reflection

Employ these insights for foresight, considering what opportunities are worth exploring as perceptions of what matters most evolve.

See:  The Global Effort to Level the Playing Field with Tech Giants

3.  Deep Dives for Impact

Explore specific opportunities in depth to generate positive financial, environmental, and societal outcomes.

4.  Complexity and Competitiveness

Acknowledge the complexities and risks associated with these opportunities to maintain global competitiveness.

5.  Organizational and Community Impact

Assess the impact of these opportunities on organizations and communities.

6.  Tracking and Perception Tools

Develop tools to monitor people's experiences and perceptions of prosperity and well-being beyond economic indicators.

7.  Partnerships for the Future

Identify necessary partnerships and resources to address future uncertainties and opportunities.

See:  Women’s Critical Role, Impact, and Empowerment in AI

Innovation and Collaboration Towards a Sustainable Future

"The Global 50" report challenges us to think beyond the conventional, to envision a world where innovation and collaboration lead to a more prosperous, equitable, and sustainable future for all.  Let all draw inspiration from "The Global 50" to envision and work towards a future that reflects our highest aspirations for growth, prosperity, and well-being.

Download the 333 page PDF report (English) --> here


NCFA Jan 2018 resizeThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Canada’s 2024 Edelman Trust Trends Report

Report | March 11, 2024

2024 Edelmen Trust Barometer (Canada Report)

Image: Cover, 2024 Edelmen Trust Barometer (Canada Report)

Understanding the 2024 Edelman Trust Trends: A Closer Look at Canada

The 2024 Edelman Trust Barometer sheds light on Canada's national trends that are shaping our society. This year's findings offer a fascinating glimpse into the public's perception of trust across various institutions and innovations. Let's dive into the key trends and what they mean for Canadians.

The report highlights a paradox: while innovation promises prosperity, it also exacerbates trust issues, leading to societal instability and political polarization.

Globally, the Edelman Trust Barometer reveals a complex picture of trust amidst rapid technological advancements and societal changes. The report highlights a paradox: while innovation promises prosperity, it also exacerbates trust issues, leading to societal instability and political polarization. This global backdrop sets the stage for understanding Canada's unique position in the trust landscape.

See:  Lagging regulation, consumer trust inhibiting FinTech adoption in Canada

In Canada, the Trust Barometer indicates a slight shift in public sentiment towards institutions and innovations. Here's what stands out:

  • Businesses have seen a significant gain in trust among Canadians, with a 5-point increase from the previous year, making business the only institution to register a significant trust gain. This shift suggests that businesses are perceived as more reliable stewards of change, possibly due to their responses to societal challenges and innovations.
  • Trust in government and media remains low, continuing the trend from the previous year. Institutions need to engage more transparently and effectively with the public.
  • Trust in NGOs remains relatively stable, indicating their continued importance in the Canadian trust ecosystem. Their role in addressing societal issues and bridging gaps between the public and other institutions is more crucial than ever.
  • Canadians express mixed feelings about innovations. For instance, trust in AI is 19 points lower than the global average, highlighting strong resistance. Conversely, green energy and gene-based medicine are viewed more positively, with more enthusiasm for green energy innovations.

What This Means for Canada

The increased trust in businesses (57% trust level) presents an opportunity for the private sector to lead in addressing societal challenges and fostering innovation. However, the continued hesitation towards government (49% trust level) and media (51% trust level) emphasizes the need for these institutions to rebuild trust through transparency, engagement, and effective communication.  For example, 81% of Canadians believe keeping innovations affordable is crucial for businesses to earn or keep their trust.

See:  Canada’s Lagging AI Adoption Needs to Accelerate to Compete

The mixed feelings towards innovation highlight a clear message:

Canadians are open to change but demand that it be managed responsibly.

Conclusion

The path forward involves a collective effort from all institutions to engage, listen, and respond to the public's concerns.  By fostering an environment of transparency and accountability, Canada can harness the positive potential of innovations while maintaining the public's trust.


NCFA Jan 2018 resizeThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Rising AI Energy Use: A Call for Sustainable Innovation

AI | March 7, 2024

Freepik Sustainable AI

Image: Freepik

AIs Energy Consumption is on an Unsustainable Trajectory and Demands Urgent Efficiency Measures

As artificial intelligence (AI) and machine learning (ML) technologies evolve, their energy consumption has skyrocketed, posing significant sustainability challenges. This trend, driven by the development of larger models and the quest for higher accuracy, raises concerns about the long-term viability of AI advancements.  In the article from Peterson Institute for International Economics Industry leaders are sounding the alarm, urging a shift towards more energy-efficient practices to ensure the future of AI aligns with global energy capabilities and environmental goals.

  • Machine learning's energy consumption is on an unsustainable trajectory, threatening to outpace global energy production. The demand for larger models and extensive training sets has led to an exponential increase in power usage, primarily in data centers for both training and inference phases.  Figures from AMD's CTO Mark Papermaster highlight the stark reality of ML systems' energy consumption compared to the world's energy output. The tech industry, historically driven by efficiency innovations like Moore's Law, now faces a period of "anti-efficiency," focusing on performance at the cost of increased energy use.

See:  Sustainability: A Must for Fintech Growth

  • The pursuit of higher accuracy in AI applications, such as voice and speech recognition, has led companies to prioritize results over energy consumption. This focus on profitability, however, overlooks the potential long-term impacts on energy resources and environmental sustainability.
  • AI's reliance on data centers significantly contributes to its carbon footprint. These centers not only consume vast amounts of electricity but also require continuous cooling through air conditioning, which further increases energy use. As AI becomes more widespread, the carbon emissions from data centers are expected to rise, exacerbating the environmental impact. There is a growing commercial pressure from consumers to reduce the carbon footprint of AI technologies. Companies striving for carbon-neutral solutions may find a competitive edge, as consumers increasingly favour environmentally sustainable practices.
  • The process of training LLMs, such as GPT-3, is extremely energy-intensive. A recent study by Cornell University cited in the article found that training such models can consume electricity equivalent to 500 metric tons of carbon, comparable to a coal-fueled power plant running for nearly half a day. Given that these models require frequent retraining to stay updated, the cumulative energy consumption and carbon emissions are substantial.  While training AI models is known to be energy-intensive, the inference process (responding to queries) may consume even more energy.  This is alarming since there are not only more users interacting with LLMs but they are also increasing their reliance and usage.

See:  Canadian Banks Face Scrutiny Over Sustainability Claims

  • Beyond cloud data centers, the proliferation of smart edge devices contributes significantly to the overall energy consumption of AI technologies. These devices, integral to the Internet of Things (IoT), are expected to use more power than the world generates, highlighting the need for energy-efficient solutions across all facets of AI deployment.
  • There is a lack of transparency from AI companies regarding the environmental costs of developing and operating their systems. This opacity makes it difficult to assess the full extent of AI's carbon footprint and to implement effective regulations to mitigate its environmental impact.
  • A coalition of environmental groups warns that the growing use of AI will lead to increased energy use from data centers. The coalition recently published a report AI Threats to Climate Change where this rise in AI-driven energy demand is expected to result in an 80% increase in planet-heating emissions, even with improvements in energy efficiency at these centers.

Ways to Reduce AIs Carbon Footprint (according to Google Researchers)

Recent Google research on reducing AI's carbon footprint suggests four key practices aimed at minimizing the environmental impact of AI systems:

  • Reduce the number of parameters (read accuracy), these models require less computational power for both training and inference, leading to lower energy consumption and, consequently, a reduced carbon footprint.
  • Use specialized processors designed specifically for machine learning tasks are more efficient than general-purpose processors. These specialized processors can handle AI workloads more effectively, reducing the amount of energy required for training and running AI models.

See:  How TinyML Is Unleashing AI Power in Everyday Devices

  • Use cloud-based data centers which are generally more energy-efficient than local data centers. They benefit from economies of scale and can implement advanced cooling and energy management technologies more effectively. Additionally, cloud providers often invest in renewable energy sources, further reducing the carbon footprint of AI operations hosted in the cloud.
  • Optimize cloud infrastructure to use data center locations based on the availability of cleaner energy sources. By choosing locations where renewable energy is readily available and affordable, AI companies can significantly reduce the carbon emissions associated with the power consumption of their data centers.

The Outlook for Sustainable AI Development

AI's vast energy use, driven by the development of larger models and the quest for higher accuracy, is on a collision course with the planet's environmental and energy sustainability goals. The tech industry, once celebrated for efficiency-driven innovations, now faces the challenge of reversing the "anti-efficiency" trend that prioritizes performance over environmental impact.

The environmental cost of AI's reliance on data centers, the intensive energy requirements for training large language models, and the increasing energy consumption for inference processes highlight the multifaceted nature of AI's carbon footprint. Moreover, the proliferation of smart edge devices threatens to exacerbate this issue, underscoring the need for comprehensive energy-efficient solutions across all facets of AI deployment.

See:  Bitcoin’s Energy Blueprint for the AI Revolution

Google's research points towards actionable strategies for reducing AI's environmental impact, including the adoption of sparse models, specialized processors, cloud-based data centers, and optimizing the location of these data centers to leverage cleaner energy sources. These recommendations offer a roadmap for the AI industry to mitigate its carbon emissions and align with global sustainability efforts.


NCFA Jan 2018 resizeThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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SEC Intensifies Accounting Audits in 2023

Report | Feb 29, 2024

Cornerstone Research SEC Accounting and Auditing Enforcement Activity

Sharp increase in SEC enforcement on accounting practices in FY 2023

The Securities and Exchange Commission (SEC) significantly stepped up its enforcement actions concerning accounting and auditing in the fiscal year 2023, as detailed in a recent report by Cornerstone Research as pointed out by at The D&O Dairy This marked increase, particularly pronounced in the fiscal year's final quarter, highlights the SEC's reinforced efforts to ensure financial transparency and uphold regulatory standards. With a 22% rise in accounting and auditing enforcement actions.

  • The SEC initiated 83 accounting and auditing enforcement actions in FY 2023, a 22% increase from 68 actions in FY 2022. This represents the highest annual number of such actions since FY 2019, emphasizing a renewed regulatory emphasis on accounting standards and auditing integrity.
  • Of the 83 actions, 71 (86%) were administrative proceedings, an increase from 75% in FY 2022. This indicates a preference for internal regulatory processes over civil court actions, with the SEC bringing 12 civil actions in FY 2023, down from 17 in the previous year.
  • Among the individual respondents, 24% were CEOs, and 22% were CFOs. This highlights the SEC's focus on holding top corporate executives accountable for financial oversight. Approximately one-third of individual respondents were Certified Public Accountants, being scrutinized on professional ethics and responsibilities in financial reporting.

See:  SEC’s Escalating Crypto Enforcement

  • The SEC initiated 11 actions against non-U.S. respondents, up from 5 in FY 2022. Actions involved respondents from Canada, the Netherlands, Ireland, the UK, Singapore, and more, indicating the global reach of SEC's enforcement efforts.
  • Despite the increase in enforcement actions, aggregate monetary settlements in these cases decreased by 7% to $583 million in FY 2023. Civil penalties constituted 33% of the total settlements, with the remainder attributed to disgorgement and prejudgment interest, highlighting the financial repercussions of non-compliance.

Why It Matters

The SEC's ramped-up enforcement actions in accounting and auditing during FY 2023 signal a clear directive towards enhanced financial accuracy and ethical auditing practices. For fintech executives, investors, and stakeholders, understanding and adapting to these regulatory dynamics is crucial for ensuring sustainable business practices and fostering a transparent financial environment.


NCFA Jan 2018 resizeThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

NCFA Financial Innovation MapNCFA Innovation Opportunity BriefsNCFA Fintech Insights
NCFA Fintech WhispererNCFA Fintech Fridays PodcastNCFA Weekly Newsletter

 

CCA Report: Investment Crowdfunding 2024: Key Insights

Report | Feb 27, 2024

CCA Regulated Investment Crowdfunding Trends Report 2024

Image: Cover

Impact of Investment Crowdfunding: Insights from the 2024 Trends Report

Crowdfund Capital Advisors just opened up complimentary access to the "Investment Crowdfunding Trends 2024" report, a comprehensive analysis leveraging data up to December 31, 2023, offering invaluable insights into RegCF markets in the U.S., trends, and impact on the economy, business, and investors.  The article below is a snapshot of living markets.  Download the data-driven report to stay informed and learn the financing and investment opportunities in regulation crowdfunding markets to see if it's right for your portfolio or business.

Overview of Investment Crowdfunding (up to Dec 2023)

Investment crowdfunding has emerged as a transformative force, redefining access to capital and igniting economic growth.

See:  Neiss Advocates for Economic Growth via H.R. 2799

  • Issuers/Deals: Over 6,800 issuers with more than 8,000 deals
  • Cities across the United States: Participation from over 1,800 cities
  • Funded Capital: $2.2 billion
  • Investors: More than 1.9 million
  • Jobs Created: Approximately 310,000
  • Economic Stimulus: $6.8 billion annually
  • Enterprise Value: $75.6 billion
  • Compound Annual Growth Rate (CAGR): 59%

Platform-Specific Insights

  • Investor Count by Platform: The top 3 platforms receive most of the industry’s checks written
  • Average Check Size by Platform: Fundify has the largest average check size
  • Success Rate by Platform: Success rates vary, depending significantly on minimum funding targets
  • $1m+ Raise Count by Platform: Wefunder leads in the million-dollar club
  • Economic Stimulus by Platform: Issuers on StartEngine have the greatest economic impact

See:  U.S. RegCF Trends: Investment Engagement by Age

Business Maturity Insights

  • Investor Preference: Investors generally prefer investing in established companies
  • Average Check Size by Business Maturity: Larger checks are written to established issuers compared to startups
  • Success Rate by Business Maturity: Established issuers have a higher success rate
  • $1m+ Raise Count by Business Maturity: More established issuers are in the $1M+ club, though many startups also achieve this milestone

Other Insights

  • Total Investments: Investors show a preference for funding equity issuers despite opportunities in debt
  • Average Raise: Equity issuers tend to raise the most
  • Investor Count: Equity investors far outweigh debt investors
  • Average Check Size by Financing Type: Larger checks are typically written to debt issuers, possibly attracted to immediate returns
  • Deal Count by Region: The West, particularly California, leads in deal count and investment amounts, showcasing regional disparities in crowdfunding activity
  • Investments and Revenue Growth: There's an average growth in revenue of 284.5% between the year an issuer was successful and the following year, indicating significant financial growth potential for companies utilizing investment crowdfunding

See:  Current State of Crowdfunding in Europe 2023 Market Report

  • Business Longevity: Only 17.8% of funded companies have gone out of business, compared to the Bureau of Labor and Statistics report that approximately 50% of all new businesses fail within 5 years, suggesting a higher sustainability rate for crowdfunded companies
  • Role in Financing: Investment crowdfunding dollars as a percentage of VC pre-seed/seed investments are increasing, highlighting its growing importance as an alternative financing source

Conclusion

This "Investment Crowdfunding Trends 2024" is data-driven proof of the sector's resilience, potential, and transformative impact, offering significant alternative finance options for entrepreneurs, investors, and the broader economy.  Through democratizing access to capital, fostering job creation, and stimulating economic growth, investment crowdfunding stands as a beacon of progress and opportunity.   Stay tuned for an upcoming episode of Fintech Fridays podcast with Sherwood Neiss, Co-Founder of Crowdfund Capital Advisors.


NCFA Jan 2018 resizeThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

NCFA Financial Innovation MapNCFA Innovation Opportunity BriefsNCFA Fintech Insights
NCFA Fintech WhispererNCFA Fintech Fridays PodcastNCFA Weekly Newsletter