CCA Report: Investment Crowdfunding 2024: Key Insights
Report | Feb 27, 2024
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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.
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
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.
The 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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