2014 Crowdfunding & The Future of Venture Finance by Mila Kyriacou
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2014 Crowdfunding & The Future of Venture Finance by Mila Kyriacou
- 1. www.StratticaCapital.com Crowdfunding & The Future of Venture Finance Mila Kyriacou CFO, Cofounder Strattica Capital 25TH July 2014
- 2. www.StratticaCapital.com Mila Kyriacou Graduate: Economics / Engineering MBA: Finance A little about me… Vice President trattica Capital CFO & Cofounder Previously:
- 3. www.StratticaCapital.com Capital Sources Friends, Fools, Family The Banker The CrowdAngels & VC
- 4. www.StratticaCapital.com Crowdfunding Worldwide Source: 2013CF The Crowdfunding Industry Report. Massolution Global crowdfunding volumes
- 5. www.StratticaCapital.com Crowdfunding Worldwide trattica Capital ? mila@stratticacapital.com
- 6. www.StratticaCapital.com The 4 Types of Crowdfunding Type Funders receive… Financial return Donation - No Reward Tangible rewards Special experiences Lending Repayment of a principal with/without interest Yes Equity Company ownership Capital gain
- 7. www.StratticaCapital.com The 4 Types of Crowdfunding Source: 2013CF The Crowdfunding Industry Report. Massolution. Growth in funding volume by crowdfunding model
- 8. www.StratticaCapital.com Crowdfunding Types Source: 2013CF The Crowdfunding Industry Report. Massolution. Donation-based crowdfunding activity. Donation | Reward | Lending | Equity
- 9. www.StratticaCapital.com Crowdfunding Types • 1884 • $100 000 • 120 000 people Donation | Reward | Lending | Equity
- 10. www.StratticaCapital.com Crowdfunding Types • 2008 • $750 000 000 • 3 000 000 people Donation | Reward | Lending | Equity
- 11. www.StratticaCapital.com Crowdfunding Types • Consumer facing products • Validation of product-market fit • Pre-sale of a product • Shorter path from a prototype to marketplace Donation | Reward | Lending | Equity
- 12. www.StratticaCapital.com Crowdfunding Types Donation | Reward | Lending | Equity
- 13. www.StratticaCapital.com Crowdfunding Types Donation | Reward | Lending | Equity • Include a video in your pitch • Have money already committed before you go to the crowd • Be active online • Make sure the price is right • Select a right crowdfunding platform Successful Crowdfunding
- 14. www.StratticaCapital.com Crowdfunding Types • Personal loans • Business loans • Asset backed loans Do not finance a start up using debt! Donation | Reward | Lending | Equity
- 15. www.StratticaCapital.com 15 VC vs. Equity Crowdfunding Comparison of Traditional VC Model to Equity Crowdfunding Model
- 16. www.StratticaCapital.com Crowdfunding Types Positioning of Equity Crowdfunding among other Forms of Capital Formation in Companies’ Lifecycles Donation | Reward | Lending | Equity
- 17. www.StratticaCapital.com Geographic Limitations Source: 2013CF The Crowdfunding Industry Report. Massolution
- 18. www.StratticaCapital.com 18 Reward vs. Equity Criteria Reward-based Equity based Backer Ownership None owns % of co. Backer Involvement Limited May be advisors/ employees Amount No limits Legal limits Ave $raised Smaller Larger Frequency No limits Limited # raisings/yr Reputation Higher risk Lower risk Financial Disclosure No need to disclose Publicize: • financials • business model Product/Service Consumer Various Tax $raised Tax Payable None Regulations Light Heavy Geography Most countries Few countries
- 19. www.StratticaCapital.com Success Rates Source: 2013CF The Crowdfunding Industry Report. Massolution. Funding probabilities for crowdfunding campaigns by model.
- 20. www.StratticaCapital.com Median campaign sizes Source: 2013CF The Crowdfunding Industry Report. Massolution. Median campaign sizes in USD across crowdfunding models.
- 21. www.StratticaCapital.com Benefits • Reputation boost • Customer validation • Audience engagement / Feedback • Possible bridge to other types of financing
- 22. www.StratticaCapital.com 22 Risks & Barriers • Reputation risk • IP protection • Donor exhaustion • Financial disclosure
- 23. www.StratticaCapital.com Questions! Crowdfunding & The Future of Venture Financing ? mila@stratticacapital.com
Editor's Notes
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- Perth largesty chasm – even if inv raised, burnt would retreat so started investing Competitors –pivot-> valuable exciting offering
- Perth largesty chasm – even if inv raised, burnt would retreat so started investing Competitors –pivot-> valuable exciting offering
- Perth largesty chasm – even if inv raised, burnt would retreat so started investing Competitors –pivot-> valuable exciting offering
- Perth largesty chasm – even if inv raised, burnt would retreat so started investing Competitors –pivot-> valuable exciting offering
- Perth largesty chasm – even if inv raised, burnt would retreat so started investing Competitors –pivot-> valuable exciting offering
- Perth largesty chasm – even if inv raised, burnt would retreat so started investing Competitors –pivot-> valuable exciting offering
- Perth largesty chasm – even if inv raised, burnt would retreat so started investing Competitors –pivot-> valuable exciting offering
- Perth largesty chasm – even if inv raised, burnt would retreat so started investing Competitors –pivot-> valuable exciting offering
- Perth largesty chasm – even if inv raised, burnt would retreat so started investing Competitors –pivot-> valuable exciting offering