Women in crowdfunding

By Katie Kostashchuk

Originally published on the Equitise Blog
(republished with permission)

As the world of finance has been, for a long time, seen as an ‘all boys club’, women have been marginalised in traditional forms of finance, venture capital and business angel investing. On average, women-owned firms start and grow their businesses with considerably less external financing compared to men (Department of Commerce US). In Australia, female entrepreneurs have experienced undercapitalisation as a core issue that undermining the success of growing their business. A 2013 study conducted by the (Australian Women Chamber of Commerce and Industry (AWCCI) of 3000 women entrepreneurs found that half of those surveyed required more funding to facilitate the growth of their business. The majority of those women have started their venture with less than $5000 worth of capital.

Crowdfunding platforms, however, now offer female entrepreneurs the chance to promote and grow their business by providing access to capital. By providing such opportunity, crowdfunding democratises finance by placing women on a level playing field with men. Moreover, with a growth in female entrepreneurship in Australia and the amount of women starting businesses increasing by 8.9% in 2013 (AWCCI), access to crowdfunding platforms in Australia will play a key role in providing capital to women. Women are almost 4 times more successful when crowdfunding than raising capital through traditional means. The number of female-owned businesses that receive venture funding in US is only 13%, however the number of crowdfunding campaigns run by women that meet their funding target is around 47% (Forbes).

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Crowdfunding is filling the funding void for early-stage companies

By Judd Hollas, founder and chief inventor, EquityNet
posted on startupbeat.com

A little more than a year ago, President Obama signed the Jumpstart Our Business Startups (JOBS) Act into law. The JOBS Act was intended to increase access to capital for the innovative companies that produce the majority of employment growth and are otherwise starved for investment capital. These early-stage startups do not have access to traditional bank loans, and venture capitalists disproportionally fund growth-stage, high-tech ventures, leaving otherwise potentially lucrative and promising ideas out in the cold.

New data published by the crowdfunding platform I founded, EquityNet, shows that equity crowdfunding is already aiding the vast business community that was previously underserved by the traditional private equity community (VC firms and Angel investors). Based on an analysis of more than 1,000 companies that have used the EquityNet platform, some very interesting findings include: …

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Equity Crowdfunding: Next Generation of Angel Investors Is Not Sorry to Disrupt

By Victoria Silchenko, Founder & CEO, Metropole Capital Group
published on huffingtonpost.com 6 May 2013

Nikola Tesla wrote once, “The present is theirs; the future, for which I really worked, is mine.” I can see this being quoted by any supporter of equity based crowdfunding (or crowdinvesting) — an innovative online tool that would give you a legitimate right to own a stake in a company you choose to invest in. Just like angels investors do.

Now, if you think you can invest too, join the club and have a nice … fight.

There are several equity-based crowdfunding portals here in the U.S. that are already operational such as AngelList, The FundersClub, EarlyShares or RealtyMogul. But since the private investors in the U.S. must fit an accredited investor profile (Rules 501, 505 and 506 of Regulation D) – there is only 1 percent of the population that is allowed to utilize such an option. …

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