Equity Crowdfunding Market Size, Share, Growth, and Industry Growth, By Type (Startups Businesses, Small Businesses, and Medium Businesses), By Application (Cultural Industries, Technologies, Products, Healthcare, and Others), Regional Forecast to 2028

Updated On: 13 November 2023

Equity Crowdfunding Market REPORT OVERVIEW

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The global equity crowdfunding market size increased in 2022. The global COVID-19 pandemic has been unprecedented and staggering, with equity crowdfunding experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden spike in CAGR is attributable to demand returning to pre-pandemic levels once the pandemic ends.

The method of raising capital to sponsor companies is known as equity crowdfunding. It belongs to the capital markets because it involves the online sale of securities from private companies to a group of investors. Securities and financial regulations frequently govern equity crowdsourcing because it includes investing in a business. Crowdfunding for investments, investment crowdfunding, and crowd equity are other names for equity crowdfunding.

In exchange for equity, equity crowdfunding is a system that lets big groups of investors finance start-up enterprises and small businesses. Investors are given a small stake in a company in exchange for their financial support of a company. If the company is successful, the value of a share in that company also increases as a result, and the opposite is also true. This crowdfunding has received media attention, which suggests that it has the most potential for new companies looking for smaller investments to establish themselves. Follow-on capital, which is needed for later growth, may come from other sources.

COVID-19 Impact: Rise in Online Donations Expanded Market Growth

The COVID-19 epidemic had a favorable effect on the expansion of the crowdfunding industry. Smaller businesses use crowdfunding to raise money to fund their current projects. Some of the crowdfunding platforms' criteria satisfy our donations to organizations that help and empower individuals. At the same time, many businesses worldwide have noticed an increase in online donations. For instance, during the second wave of the COVID-19 pandemic, internet donations increased significantly on crowdfunding websites such as Milaap, ImpactGuru.com, and Ketto.

LATEST TRENDS

"Service Capacity to Raise Money from Individuals to Surge Market Growth"

One key aspect fueling equity crowdfunding market growth is the rise in equity-based crowdfunding's capacity to raise money from individuals in exchange for corporate equity shares. Equity-based crowdfunding provides fundraisers with several advantages, including the ability to sell shares to multiple investors, which may help them raise more money, the lack of loan repayment obligations or debt-based credit checks, and the ability to raise entire companies with a single investment. Moreover, equity-based crowdfunding benefits investors by enabling them to select the companies they are most passionate about, earn a stake in the company, and invest according to their needs.

Equity Crowdfunding Market Segmentation

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• By Type Analysis

By type, the market is segmented into startup businesses, small businesses, and medium businesses.

• By Application Analysis

Based on application, the market is classified into cultural industries, technologies, products, healthcare, and others.

DRIVING FACTORS

"Rising Awareness About the Service and Its Potential to Propel Market Growth"

Crowdfunding has been hailed as an unexplored and massive new option for business owners and startups who struggle to get money through conventional channels. To raise money to help the startup ecosystem, there is a specific crowdfunding platform, which is expected to surge growth in the equity crowdfunding market. The acquisition would broaden SeedBlink's reach as it gets ready to consolidate and build the infrastructure for equity investment in European digital companies at all stages by increasing the venture partners' activities in Western Europe.

"Growing Need for Funds to Bolster the Service Demand"

Equity crowdfunding raises money to support projects and businesses. Online platforms allow fundraisers to collect money from a large audience. Crowdfunding is most typically used to raise funds for growth and startup companies. It is an innovative way to raise money for brand-new projects, businesses, or ideas. It might also be a way to build a network of people who will support the service. By utilizing the strength of the online community, one can gain access to new clients and obtain useful industry knowledge.

RESTRAINING FACTORS

"Lack of Legal Frameworks May Impede Market Expansion"

A lack of legal frameworks for safe and secured transactions on equity crowdfunding platforms may hinder market growth. This may act as a barrier to equity crowdfunding market growth.

Equity Crowdfunding Market REGIONAL INSIGHTS

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"North America Is Predicted to Dominate the Market by the Presence of Most Market Players"

North America is expected to lead the equity crowdfunding market share due to the presence of major market players in the region. Key players' presence offers high potential for crowdfunding activities, which will further propel regional growth.

Asia Pacific is likely to show significant growth owing to the growing internet penetration that offers better accessibility to equity crowdfunding platforms.

KEY INDUSTRY PLAYERS

"Key Companies to Emphasis On the Development of Advanced Technology"

Key market players are investing heavily on research and development of the product. Companies are also paying focus on launching advanced products. Emphasis on gaining collaborations, mergers, and acquisitions is increasing among leading players. The major market players are striving to maintain partnerships with other key players in the same industry. Gaining partnerships with other companies will develop a strong consumer base in the global market. The key competitors are adopting organic and inorganic growth strategies to surge their market share in the global market. 

List of Market Players Profiled

• WeFunder (U.S.)
• Angel List (U.S.)
• Republic (U.S.)
• StartEngine (U.S.)
• MicroVentures (U.S.)
• Fundable (U.S.)
• EquityNet (U.S.)
• Localstake (U.S.)
• SeedInvest (U.S.)
• Crowdfunder (U.S.)
• Netcapital (U.S.)
• Mainvest (U.S.)
• Equifund (U.S.)
• Trucrowd (U.S.)
• Honeycomb Credit (U.S.)
• Buy the Block (U.S.)

REPORT COVERAGE

The market research study offers thorough information on numerous market aspects. The growth drivers, restraints, geographical analysis, competitive environment, and challenges are a few of them. Additionally, it provides an analytical analysis of market trends and projections for various factors to show potential investment areas. From 2022 through 2029, the market is objectively assessed to determine its financial viability. The report's data was compiled using a variety of primary and secondary sources.