Crowdfunding Overview and Types

The practice of raising funds for a project or cause by collecting small amounts of money from a large number of people, typically online.

This type of crowdfunding involves investors purchasing equity or ownership shares in a company or project.

This model sees investors lending money to a project or business with the expectation of receiving interest payments and repayment of the principal.

Individuals pledge money in exchange for non-financial rewards, such as early access to a product or exclusive merchandise.

This crowdfunding model focuses on donations and philanthropic support. Contributors provide funds without expecting any tangible returns.

The legal framework that provides guidelines and regulations for crowdfunding activities.

These platforms connect project creators with potential funders and facilitate the entire crowdfunding process.

Crowdfunding platforms have various roles, including managing campaign setup, processing payments, and providing support to both creators and funders.

A type of crowdfunding where investors contribute funds in exchange for ownership shares (equity) in a business.

A type of crowdfunding where individuals lend money to businesses, typically through online platforms, and earn interest on their loans.

A European Union regulation that sets out common rules for crowdfunding service providers, including authorization, transparency, and consumer protection.

Companies or platforms that connect funders and projects in crowdfunding activities, facilitating the process.

The requirement for crowdfunding service providers to operate with honesty, fairness, and professionalism, prioritizing the interests of their clients.

The process of officially authorizing crowdfunding platforms by competent authorities to ensure they meet regulatory standards.

An online platform where companies seeking funding connect with investors willing to purchase shares or stakes in the company.

Authorities that govern and regulate crowdfunding platforms. They ensure the platform operates ethically and protects investors.

A process where a company acquires a controlling stake in a publicly listed company, triggering a mandatory offer to purchase the remaining shares at a specific price.

Platforms that offer investment opportunities through crowdfunding must be authorized by the government of the country they operate in, ensuring compliance with regulations.

The platforms must provide clear information and analysis regarding investment projects, enabling investors to make well-informed decisions.

Crowdfunding platforms should provide investors with options to exit their investment, such as selling their shares or withdrawing their funds.

Investment failure can occur even with experienced investors due to unforeseen circumstances. However, fraud is less common and can be mitigated through various measures.

Various types of fraud can exist, such as misrepresentation of financial information or deceptive activities to gain funds.

A situation where one party (like a tech company) has more information than the other party (like a user) about data collection and usage.

A European Union law that protects the personal data and privacy of its citizens.

Users must clearly agree to data collection. This means they need to understand what data will be collected and how it will be used.

Requires platforms to provide clear and concise information about their data collection and usage practices.

Platforms should only collect the data that is essential for their services. They shouldn't collect more data than necessary.

Platforms must ensure that user data is protected through secure measures like encryption and breach notifications. They must also have procedures in place to protect data from unauthorized access.

Platforms need to show that they comply with GDPR requirements. This involves documenting their data practices and appointing a Data Protection Officer (DPO) if necessary.

A crowdfunding model where contributors provide funds without expecting any tangible returns.

A technology that enhances transparency and security in crowdfunding by creating a permanent record of transactions.

The use of artificial intelligence to analyze user data and optimize crowdfunding campaign strategies to increase engagement.

Regulations designed to protect investors and ensure transparency in the crowdfunding industry.

The use of crowdfunding to finance projects related to real estate and sustainable energy.

The ability to raise capital for projects without relying on traditional financing methods.

This type of crowdfunding allows investors to buy shares in a company or project, becoming part-owners.

They connect project creators with investors and handle the entire crowdfunding process, from campaign creation to payment processing.

The EU regulation sets out common rules for crowdfunding service providers, ensuring transparency and protection for both investors and projects.

These platforms are required to operate honestly, ethically, and professionally, putting the needs of their clients first.

Crowdfunding platforms facilitate the process of raising funds for projects, connecting investors with opportunities.

This type of crowdfunding involves investors lending money to businesses or projects with the expectation of earning interest on their investment.

It involves raising funds through donations where contributors support a cause or project without expecting any financial return.