1. Going global and going local: The future and benefits of crowdfunding Claire Ingram, Stockholm School of Economics Robin Teigland, Stockholm School of Economics

2. Crowdfunding in Sweden Dr. Robin Teigland Associate Professor Stockholm School of Economics robin.teigland@hhs.se @robinteigland Claire Ingram PhD Student Stockholm School of Economics claire.ingram@hhs.se @Claire_EBI

8. What is crowdfunding? Accumulation of small investments in individual projects by large number of individuals (the “crowd”) via or with help of Internet and social networks (DeBuysereet al., 2012)

9. Massolution2013 Globally 470 000 projects via 800+platforms SWEDEN 37m SEK (Oct 2013)

10. Form of FundingBenefits for Funders Donation-basedDonationIntangiblebenefits. Reward-basedDonation or pre- purchase Rewardsin addition to intangible benefits. Equity-basedInvestmentReturn on investment if company does well. Rewards sometimes also offered and intangible benefits may motivate too. Debt-basedLoanRepaymentof loan with interest. Alternativelyintangible benefitsif loan given interest- free. Ingram &Teigland, 2013

11. Money raised: SEK 36,502/ €4,000 Number of investors: 186 Date funded: September 2011 Sector: Food Stockholm success story: Flippin’Burgers

12. Top 5 Best American Restaurants in Europe Enabled local interaction, involvement

13. Who are the funders?  Educated experts?  85 % of respondents have university degree (vs16% of women and 22% of men in general population, 2013)  42% had knowledge in same field as project they funded  49 % reported to have been better at judging project qualitydue toprevious experience  The “in-crowd”  47% of “the crowd” classified themselves as entrepreneurs – compared to only 7 % of Swedish population (2012)  77 % never bought shares in unlisted company before  41 % risk lovers Skoglund&Stiernblad2013

16. Equity crowdfunding in Sweden  No EU/EEA country can require a prospectus to be prepared for rounds of less than 100 000 EUR  For rounds of 5 million EUR or more, an EU prospectus is always required  In Sweden the limit is 2.5 million EUR  Less than 150‘non-qualified’ investors without a prospectus

18. Benefits of Crowdfunding  Test the market or establish a user base  Market your product or service  Obtain funding (may not be a huge amount of money though)  Screening device for investors  Reach investors further afield or people without the right “connections”  Source skills and connections?  BUT in Equity crowdfunding:Lots of small investors – a problem? Ingram &Teigland, 2013

19. Lots to think about.... Going global?Going local? Reward-based? l Niche product or service? l Global appeal? l What are the rewards? l How do you reach an international audience – and stand out? l Community-specific product or service? l Local appeal? l What are the rewards? l Do the community know about you – can you reach them? l Local benefits Equity-based? l Looking to scale up? l How much equity? l How to value your project? l Looking to establish a foothold? l How much equity? l How to value your project? l Local benefits – experience, connections etc

20. How to succeed?  Are you going global or going local?  Choose the right platform– and crowdfunding type – for your project (keep in mind platform fees)  Make the concept easily understood  Make it personal?  Ensure that you have initial critical mass (social media, newspapers) – NB in donation- and reward-based  Feed the crowd  Keep followers up to date  MAGIC

24. Thank you! Image via NewYorker.com Questions? Claire Ingram Stockholm School of Economics claire.ingram@hhs.se @Claire_EBI