Presentation at lokalekonomidagen in Knivsta, Sweden

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

10. Form of Funding
Benefits for Funders
Donation-based
Reward-based
Donation
Donation or prepurchase
Intangiblebenefits.
Rewardsin addition to
intangible benefits.
Equity-based
Investment
Return on investment if
company does well. Rewards
sometimes also offered and
intangible benefits may
motivate too.
Debt-based
Loan
Repaymentof loan with interest.
Alternativelyintangible
benefitsif loan given interestfree.
Ingram &Teigland, 2013

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

12. Enabled local interaction, involvement
Top
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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

14. 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?
Reward-based?
l
l
l
l
Niche product or service?
Global appeal?
What are the rewards?
How do you reach an
international audience – and
stand out?
Going local?
l
l
l
l
l
Equity-based?
l
l
l
Looking to scale up?
How much equity?
How to value your project?
l
l
l
l
Community-specific product
or service?
Local appeal?
What are the rewards?
Do the community know
about you – can you reach
them?
Local benefits
Looking to establish a
foothold?
How much equity?
How to value your project?
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!
Claire Ingram
Stockholm School of
Economics
claire.ingram@hhs.se
@Claire_EBI
Questions?
Image via NewYorker.com