Dienstag, 18. Juni 2013

Where Crowdinvesting Stands In Europe

Whitepaper, published by European Crowdfunding Network

… only 30% of businesses are using bank loans while some 40% rely on short-term bank credit or overdraft facilities. On the investment side, venture capital, according to industry statistics, invests in less than 5,000 high-growth businesses a year and business angels in around 1,000. Of the millions of SMEs that are not accessing this formal supply of finance, some will be able to benefit from organic growth and profitability, others will be able to smooth income fluctuations – which are normal in seasonal businesses – through supplier credits or factoring, for example.

As a result, a very large number of SMEs, maybe as many as 10 million, rely on their own wealth, their family, friends and fans to invest in growth, support them through economic difficulties or help to purchase new equipment, finance stock and other operational needs. Crowdfunding is proposing to formalise this part of the financial services sector, to make it transparent and therefore accessible, and to combine it with aspects of cocreation and collaborative open innovation.

There is one complicating factor in Germany having to do with an EU-mandated European Alternative Investment Fund Managers Directive, or AIFMD. Project companies in particular carry the most risk of being deemed AIF’s. The ECN explains the implications of this phenomenon on associated costs…

The application of the AIFMD regime to companies seeking funds by means of Crowdfunding platforms (which appears likely if they are Project Companies) would make any attractive cost-reward ratio impossible. Projects like movies or games are likely to be completely prohibited under the German implementation of the AIFMD since they do not qualify as “material assets” (Sachwerte) within the meaning of the Capital Investment Act.

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