Crowd Valley COO Paul Higgins facilitated a workshop on crowdfunding in Berlin on May 25th with a group of entrepreneurs, investors, and finance professionals at the fifth SDW Gründer- und Unternehmerforum conference.

1. Crowdfunding in Europe!
Paul Higgins
Co-founder, Crowd Valley
May 25th, 2013
Gründer- und Unternehmerforum
Berlin

2. Overview!
• Grow VC Group – innovating investing
• Crowdfunding in connected ecosystems
• Crowdfunding in Europe today
• Where crowdfunding is going next
@paulhigginz @crowdvalley

3. Background – Grow VC!
• Global marketplace for startup funding
• Founded 2009
• “Everyone Funding Startups”
– 2012 - $35M raised
– 5,000+ startups
– 190+ countries
– Several raised rounds, first exits
@paulhigginz @crowdvalley

4. Cintep (Australia): First $100,000 from equity crowdfunding!
@paulhigginz @crowdvalley

5. Regulatory activities!
• US Delegation in Transatlantic Economic Forum
• Cooperation with Singapore Government Investment Company, UKTI, etc.
• Crowdfunding Regulatory Intermediary Association (CFIRA)
• Crowdfunding Professional Association (CFPA)
• National Crowdfunding Association (NLCFA)
• European Crowdfunding Network (ECN)
• Cooperation with Securities and Exchange Commission (SEC) and Financial
Industry Regulatory Authority (FINRA)
@paulhigginz @crowdvalley

6. Title II
• Online Solicitation of Accredited
Investors
• This part opens possibility market, sell
and trade private securities in market
places
• This part can have more important
influence on later funding phases than
the early phase crowdfunding
Title III
• Crowdfunding with non-accredited
investors
H.R. 3606: Jumpstart Our Business Startups (JOBS Act)!
@paulhigginz @crowdvalley

7. Grow VC Group!
• Launched spin-off Crowd Valley in 2012 to provide crowdfunding
infrastructure:
– Configurable platform
– Shared business networks
– Back Office financial services
• Spun out other companies providing various services to support new online
funding marketplaces
– Grow Advisors
– ChangeLab23
– Mutual Seed Fund
• Developed a portfolio through global incubation services
– 6 portfolio companies to date
@paulhigginz @crowdvalley

8. Finance and
Services
Infrastructure Investment
Portfolio
@paulhigginz @crowdvalley

9. Crowdfunding platforms can provide…!
• Validation of an idea
• Relationships with new potential customers
• Matchmaking between investors and entrepreneurs
• Efficient access to capital
• Standardised documentation, e.g. Shareholder Purchase Agreements
• Access to talent
@paulhigginz @crowdvalley

10. Equity crowdfunding has now provided over $200m"
!
0
20
40
60
80
100
120
140
160
180
200
Funds
raised
/
$m
Australian
Small
Business
Offerings
Board
Grow
VC
CircleUp
CrowdCube
Seedrs
Symid
Data from www.thecrowdcafe.com
@paulhigginz @crowdvalley

11. Where crowdfunding is today!
Source: crowdsourcing.org
@paulhigginz @crowdvalley

12. Crowdfunding must be part of existing ecosystems!
• Crowdfunding does not happen in a vacuum
• “Invest in Lines, not Dots” – venture capitalist, Mark Suster:
Images from bothsidesofthetable.com/2010/11/15/invest-in-lines-not-dots
@paulhigginz @crowdvalley

13. Building an entrepreneurial ecosystem in your city!
Universities
Incubators
Accelerators
Government programs
Investor pitch events
Angel networks
Funding platforms
@paulhigginz @crowdvalley

14. A ’typical’ startup path!
Universities
Incubators
Accelerators
Government programs
Investor pitch events
Angel networks
Funding platforms
@paulhigginz @crowdvalley

15. The investor’s viewpoint!
@paulhigginz @crowdvalley

16. Finding your natural constituency!
Source: crowdsourcing.org
@paulhigginz @crowdvalley

17. Crowdfunding in Europe today!
• New regulations in Italy
– The CONSOB regulation implements Law n. 221, the so-called Decree
Growth
– Currently only available to “innovative startups”, which have a
university researcher in their team and an institutional investor to
subscribe to at least 5% of the capital required
• Many platforms around Europe with various funding models, some already
authorised by financial regulators
– CrowdCube (UK)
– Seedrs (UK)
– Companisto (Germany)
– Symbid (Netherlands)
– Siamosoci (Italy)
– Etc.
@paulhigginz @crowdvalley

18. Equity crowdfunding success in consumer internet!
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Propor%on
of
all
successful
equity
fundraises
in
Europe
by
sector
Data from www.thecrowdcafe.com
@paulhigginz @crowdvalley

19. Rewards crowdfunding success in music, film, theatre!
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Propor%on
of
all
successful
Kickstarter
fundraises
by
sector
Data from www.kickstarter.com
@paulhigginz @crowdvalley

20. Median equity crowdfunding raise for 11% equity!
0
2
4
6
8
10
12
14
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
Number
of
equity
fundraises
in
Europe
Amount
of
equity
given
to
crowdfunding
investors
/
%
11%
Data from www.thecrowdcafe.com
@paulhigginz @crowdvalley

21. 0
50
100
150
200
250
300
350
400
450
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
No.
of
Investors
Funds
raised
through
crowdfunding
for
equity
in
Europe
/
$
Average raise of $111,000 from 80 investors (in 46 days)!
80
$111k
Data from www.thecrowdcafe.com
@paulhigginz @crowdvalley

22. Equity crowdfunding goes beyond startups!
• Expanding a mezzanine fund for Oil & Gas investments in Rio de Janeiro
• Providing liquidity for existing shareholders in high-tech companies in
Auckland
• Doctors financing R&D for new medical device companies in Sydney
• Alumni supporting their university’s entrepreneurship in San Francisco
• Offering investment opportunities in real estate in London
• Connecting traders of precious stones with professional investors in New
York
@paulhigginz @crowdvalley

23. Crowd Valley: Your Crowdfunding Network!
@paulhigginz @crowdvalley

24. Crowd Valley: Your Logos, Branding, Rules!
@paulhigginz @crowdvalley

25. Crowd Valley: Your Look & Feel!
@paulhigginz @crowdvalley

26. Where crowdfunding is going next…!
• Powerful and informative provider of data
• Efficient marketplaces in diverse sectors
• Integration with the rest of the ecosystem
– Universities
– Incubators
– Angel investors
– VCs
– Institutional funds
• Co-investment models
– Active
– Passive
@paulhigginz @crowdvalley

27. Crowdfunding in Europe!
Paul Higgins
@paulhigginz @crowdvalley
paul@crowdvalley.com