Equity crowdfunding explained. (Principles) What is Crowdinvesting? AngelList, Republic, StartEngine скачать в хорошем качестве

Equity crowdfunding explained. (Principles) What is Crowdinvesting? AngelList, Republic, StartEngine

Crowd Investing platforms or equity crowdfunding shows strong worldwide growth. Brands in the market are AngelList, Republic, StartEngine, Wefunder, Microventures or Netcapital. They all have common features. In this video we learn about the common principles of the platforms. In this session, we are going to learn about the characteristics of Equity Crowdfunding. Where can Equity Crowdfunding be found in the FinTech-Market? The FinTech-Market is divided into the segments Account & Payments, Financing, Investment and Services & Tools. Crowdfunding is located in the FinTech segment Financing because the financing of projects, private or corporate clients is done by a large number of people, the so-called crowd, who are recruited as investors via the Internet. The subcategory Crowdfunding is divided into Profit oriented Online Alternative Finance and Non-profit oriented Online Alternative Finance. Equity-Based Crowdfunding is found in the Profit oriented Online Alternative Finance segment because investors receive a financial return on their investment in startups. Equity-Based Crowdfunding is the brokering of capital via an Internet platform for the purpose of financing an existing company, a company in the process of being founded, or a company to be founded. Due to regulation in Germany, most of private investors acquire a stake in the company in the form of a share-like agreement, as notary fees are very high. Within Equity-Based Crowdfunding, a further distinction is made between lending-based Crowdinvesting and equity-based Crowdinvesting. Lending-based Equity-Based Crowdfunding is the participation in the company with debt capital, possibly equity-like mezzanine capital. The most important mezzanine financial instrument is the subordinated profit-participating loan, in which investors participate proportionally in the company´s profits without receiving the rights associated with an equity investment, such as voting rights. Equity-based Crowdinvesting refers to the sale of equity interests in companies in the form of a silent partnership. A silent partnership is a virtual participation in the establishment of the company and is imitated by contract law. Investors have two different options for investing in startups. The first investment option is direct investment in a startup. The second investment option is an indirect investment, also known as a pooled investment. This investment in a financial vehicle collects all the financial contributions from the crowd and then invests the entire amount in the startup as an individual shareholder. Two models are common in Equity-Based Crowdfunding: The first-come, first-served method and the auction mechanism. In the first-come, first-served approach, founders set a total funding limit and stop selling securities to the crowd when the limit is reached. In the auction mechanism, investors can make commitments by specifying the number of lots they want to buy and the price they are willing to pay for each lot. For this purpose, the portal and the startup set a lower limit for the price of a single lot. In the first phase of the auction, everyone who has paid money gets the desired number of lots, and the lowest price applies to everyone. The biggest advantages for investors are the ease and comprehensiveness of comparing early financing options. In addition, many crowdlending platforms allow the placement of small amounts of investment, opening up the world of Venture Capital investing to small investors. Furthermore, investors und fund managers incur low or no management fees and carried interests compared to traditional VC funds. In addition, investors can participate in co-investment schemes with professional investors. Equity-Based Crowdfunding platforms provide standardized financial contracts and perform due diligence on startups with the help of experts. One very important fact is that private investors acquire a stake in the company in the form of a subordinated profit-participating loan or silent partnership, but not a stake in the equity of a company. This means that the investors have a pro-rata share in the profits of the company, but they do not have voting rights. The second argument refers to the various investment opportunities that can be made directly or indirectly through Syndicates or Venture Funds. The last argument refers to the allocation of shares. Two different mechanisms are used here, one is the the first-come, first-served method and the other is the auction mechanism. The videos explain different fintech business models and refer to the book Fintech Business Models by Matthias Fischer published in February 2021. The channel covers fintechs in the area of payments, robo advisory, Personal Finance Management, crowdfunding, artificial intelligence, blockchain, cryptocurrency and innovative digital solutions in banking.