The State of Global Equity Crowdfunding in 2025: Breaking Down Barriers to Borderless Investment

In today's interconnected world, innovation knows no borders—and increasingly, neither does the capital to fund groundbreaking ideas. As the Global Equity Crowdfunding Alliance (GECA) continues its mission to enable truly borderless investments, we're witnessing significant progress in how entrepreneurs access capital and how investors participate in opportunities worldwide. This evolution is creating a more inclusive, efficient financial ecosystem that benefits stakeholders globally.

The Global Equity Crowdfunding Landscape in 2025

Equity crowdfunding has firmly established itself as a vital alternative to traditional venture capital and angel investing, democratizing access to early-stage investment opportunities while providing entrepreneurs with broader funding options. The global equity crowdfunding market stands at approximately $2.1 billion in 2025, with projections to reach $5.4 billion by 2032. This represents steady growth at a CAGR of around 13-15%, with significant potential for acceleration as cross-border solutions mature.

The market continues to evolve geographically, with North America accounting for approximately 40% of the global volume, followed by Europe at 30% and Asia-Pacific at 20%. The remaining 10% is spread across other regions, indicating substantial growth opportunities in emerging markets as regulatory frameworks develop and digital infrastructure expands.

Regulatory Progress: Toward Greater Alignment

The regulatory landscape for equity crowdfunding in 2025 shows encouraging developments toward more coherent frameworks:

European Union: The European Crowdfunding Service Provider (ECSP) Regulation, implemented in 2021, created a harmonized framework across all 27 EU member states. Platforms with ECSP authorization can operate seamlessly throughout the EU with a fundraising cap of €5 million per project over a 12-month period. The ECSP also introduced standardized investor protections, including the Key Investment Information Sheet (KIIS) and clear disclosure requirements.

United States: Regulation Crowdfunding (Reg CF) governs the U.S. market, with a maximum fundraising limit of $5 million per 12-month period. This regulatory framework requires the use of SEC-registered intermediaries and includes investor protections based on income and net worth. This structure has enabled steady growth within the U.S. market while providing a stable model that other countries can reference.

United Kingdom: Post-Brexit, the UK has maintained its own regulatory framework under the Financial Conduct Authority (FCA), distinct from the EU's ECSP. The UK model continues to emphasize investor self-certification and platform-based due diligence, with no fixed funding caps for equity offers (though prospectus requirements apply for larger raises).

Emerging Markets: Countries like Malaysia, Thailand, and New Zealand have developed their own equity crowdfunding regulations, each adapting international best practices to local market conditions. This regulatory development in emerging markets signals growing global recognition of equity crowdfunding's importance to economic growth and financial inclusion.

While this regulatory diversity creates a complex landscape to navigate, it also presents opportunities for innovation in creating compliant pathways for cross-border capital flows. Organizations like GECA are working to bridge these regulatory differences to enable truly borderless equity crowdfunding.

Opportunities for Innovation in Global Equity Crowdfunding

As the equity crowdfunding industry continues to mature, several key areas present significant opportunities for innovation. By addressing these challenges, we can unlock the full potential of a truly global equity crowdfunding ecosystem:

1. Regulatory Harmonization Opportunities

The evolving regulatory landscape presents a significant opportunity for greater alignment. While each jurisdiction maintains its own rules regarding investor eligibility, funding caps, and disclosure requirements, we're seeing promising movements toward compatibility:

  • The EU's ECSP Regulation demonstrates that regional harmonization is achievable
  • Bilateral agreements between major markets are creating regulatory bridges
  • Industry-led standardization efforts are helping platforms navigate multiple jurisdictions

With continued collaboration between regulators, industry groups like GECA, and innovative platforms, these regulatory differences can evolve from barriers into manageable frameworks that enable rather than restrict cross-border investment.

2. Trust and Transparency Solutions

Cross-border investments naturally involve information gaps between investors and companies. This creates fertile ground for innovation in transparency and trust-building mechanisms:

  • Standardized information frameworks that work across jurisdictions
  • Independent verification systems for key company claims
  • Cultural and market context services that bridge knowledge gaps
  • AI-driven due diligence tools that supplement human expertise

The platforms that excel in building these transparency bridges are seeing higher cross-border investment flows. By making foreign opportunities as understandable as domestic ones, these innovations are gradually dismantling traditional information barriers.

3. Governance Innovation

Post-investment governance in cross-border scenarios offers exciting opportunities for technology-enabled solutions:

  • Digital governance platforms with multilingual capabilities
  • Standardized reporting templates that satisfy multiple jurisdictions
  • Virtual AGM and voting systems that enhance investor participation regardless of location
  • Investor representatives or nominees that bridge governance gaps

These innovations are transforming governance from a challenge into a strength of equity crowdfunding, allowing investors to remain connected and informed despite geographic distance.

4. Liquidity Enhancements

Creating liquidity for equity crowdfunding investments represents one of the most promising innovation areas:

  • Emerging secondary markets specifically designed for crowdfunded equity
  • Tokenization approaches that enable fractional ownership and potential trading
  • Standardized valuation methodologies that facilitate fair pricing across borders
  • Pre-arranged exit opportunities through partner networks

As these solutions mature, the historical liquidity gap in equity crowdfunding is gradually narrowing, making cross-border investments more attractive to a broader range of investors.

5. Addressing Operational Challenges

Cross-border equity crowdfunding currently faces several practical operational challenges that require attention:

  • Currency conversion typically involves multiple intermediaries and significant fees
  • Documentation often requires manual translation into different languages
  • Financial reporting must be adapted to meet different accounting standards
  • Payment processing across borders remains complex and time-consuming

While some platforms have begun implementing basic solutions like partnering with payment providers or offering template documentation, these approaches remain limited in scope. More comprehensive solutions to these operational frictions represent an important area for future development in the industry.

Emerging Solutions for Borderless Equity Crowdfunding

The global equity crowdfunding ecosystem is rapidly evolving, with innovative solutions transforming how cross-border investment works. These approaches, championed by GECA members and supporters worldwide, are creating tangible pathways toward a more integrated global market:

1. Platform Networks and Partnerships

Forward-thinking platforms are creating powerful collaborative networks that extend their reach while navigating regulatory requirements:

  • Reciprocal listing agreements enable platforms to showcase opportunities across borders
  • Deal syndication across partner platforms drives international capital to promising ventures
  • Shared due diligence protocols enhance efficiency and consistency
  • Cross-border investor introductions create valuable connections within regulatory bounds
  • Innovative referral models with revenue-sharing mechanisms incentivize platforms to collaborate on cross-border opportunities

These collaborative models are allowing platforms to offer international opportunities to their investors while maintaining compliance with local regulations. The resulting networks are more than the sum of their parts, creating robust ecosystems for global investment flows.

2. Standardized Disclosure Frameworks

The industry is working toward more consistent approaches to disclosure that help bridge information gaps across borders:

  • Key Investment Information Sheet (KIIS) templates from the EU ECSP providing a model for standardized disclosure
  • Emerging best practices for presenting company and deal information in accessible formats
  • Translation services that make disclosure documents available in multiple languages
  • Efforts to align financial reporting formats to facilitate cross-border comparison

These standardization initiatives are beginning to reduce information barriers between markets, helping investors to better understand opportunities regardless of their origin. With continued development of these frameworks, we can expect further improvements in transparency and cross-border trust.

3. Blockchain and Tokenization Solutions

Blockchain technology is delivering transformative solutions to many of the traditional barriers in cross-border equity crowdfunding:

  • Programmable compliance that automates jurisdiction-specific rules while enabling global participation
  • Transparent ownership records with immutable audit trails that enhance trust
  • Standardized tokenized equity that creates potential for seamless secondary trading
  • Smart contracts that streamline investor governance and reporting across borders

Initiatives like Dacxi Chain, which is developing the intelligent infrastructure for a global equity crowdfunding ecosystem, exemplify how blockchain can connect platforms across borders while maintaining regulatory compliance. By creating a standardized protocol for cross-border investment, these solutions are reducing friction while enhancing transparency, security, and trust in the global marketplace.

4. Regulatory Collaboration and Innovation

The relationship between regulators and the equity crowdfunding industry is evolving toward greater collaboration and experimentation:

  • Regulatory sandboxes provide safe spaces to test cross-border investment models under supervision
  • Bilateral and multilateral agreements between national regulators create bridges between markets
  • Mutual recognition frameworks identify compatible regulatory standards across jurisdictions
  • Regular industry-regulator dialogues shape more effective and innovation-friendly regulations

These collaborative approaches between industry and regulators are creating pragmatic pathways to test and refine cross-border models while ensuring appropriate investor protection. Rather than seeing regulation as a barrier, innovative platforms are engaging constructively with regulators to build compliant routes to global markets.

5. Current Investor Education Approaches

Today's equity crowdfunding platforms typically provide basic educational resources to help investors understand international opportunities:

  • FAQs and information pages explaining regulatory requirements
  • Basic country guides highlighting local business environments
  • Deal summaries translated into major languages
  • Webinars and blog posts about cross-border investing considerations

While these educational tools represent important first steps, they remain relatively limited in scope and sophistication. As the industry evolves, more comprehensive educational resources will be needed to fully address the knowledge gaps that currently limit cross-border participation.

The Path Forward: GECA's Vision for Borderless Equity Crowdfunding

The Global Equity Crowdfunding Alliance (GECA) is driving the transformation toward a truly borderless ecosystem for equity crowdfunding. By uniting platforms, regulators, and stakeholders from around the world, GECA is accelerating solutions to the historical barriers that have limited cross-border investment flows.

Our vision encompasses five interconnected elements that together create a powerful framework for global equity crowdfunding:

  1. Regulatory Harmony: While recognizing the validity of different regulatory approaches, we champion frameworks that enable cross-border investment flows while maintaining appropriate investor protections. Through constructive engagement with regulators worldwide, we're helping to shape policies that support responsible innovation. 
  2. Operational Standards: We're driving the development of industry standards for disclosure, due diligence, and governance that make cross-border investments more transparent, efficient, and secure. These standards allow platforms to work together seamlessly across borders. 
  3. Technological Innovation: We embrace innovative solutions, including Dacxi Chain which is developing the intelligent infrastructure for a global equity crowdfunding ecosystem, that can overcome operational barriers and enhance trust in cross-border investments. 
  4. Collaborative Networks: We actively foster connections between platforms, investors, and entrepreneurs across borders, creating a vibrant global community that shares best practices, co-invests in opportunities, and builds bridges between markets. 
  5. Inclusive Growth: We're committed to ensuring that borderless equity crowdfunding democratizes access to capital for entrepreneurs worldwide while providing investors with truly global opportunities. This inclusive approach is central to our mission and values. 

Through these five strategic priorities, GECA is helping to build a more integrated, efficient, and accessible global equity crowdfunding ecosystem that benefits all participants.

Conclusion: The Future is Borderless

The state of global equity crowdfunding in 2025 reflects an industry in the midst of an exciting transformation. While regulatory frameworks have matured in many markets, true cross-border investment is now entering a new phase of growth and accessibility. The innovation happening across platform networks, standardization efforts, blockchain technology, regulatory collaboration, and investor education is creating a powerful momentum toward truly borderless equity crowdfunding.

The path forward is clear and promising. As platforms develop collaborative networks, standardize information and practices, embrace technological innovation, and engage constructively with regulators, we're witnessing the emergence of a truly global ecosystem for connecting entrepreneurs with capital and investors with opportunities regardless of geography.

This evolution isn't just about technology or regulation - it's about expanding possibilities for entrepreneurs and investors worldwide. By enabling capital to flow more efficiently across borders, we're helping to fund innovation, create jobs, and build wealth in markets that have historically had limited access to growth capital. This democratization of finance represents one of the most exciting developments in global capital markets.

As the Global Equity Crowdfunding Alliance, we invite all stakeholders - platforms, investors, entrepreneurs, regulators, and technology providers - to join us in accelerating this transformation. Together, we're building a more efficient, inclusive, and dynamic global ecosystem for equity crowdfunding that will empower the next generation of innovation and growth worldwide.

This article was prepared by the Global Equity Crowdfunding Alliance (GECA) based on research and insights from our global network of members and supporters. For more information about GECA's mission and activities, please visit thegeca.org.

 

by GECA

Breaking Down Investment Borders: A Conversation with GECA and CfPA Leadership

At SuperCrowd LA, a significant dialogue unfolded between two organizations working to transform the global investment landscape. Andy Field, Steering Committee Lead of the Global Equity Crowdfunding Alliance (GECA), and Jenny Kassan, President of the Crowdfunding Professional Association (CfPA), discussed their shared vision for democratizing finance through borderless equity crowdfunding.

The Vision: Democratizing Global Investment

The conversation centered on a powerful shared mission: making equity crowdfunding accessible to everyone, regardless of geographic location. As Field explained, GECA was created approximately eight months ago with the specific goal of "breaking down borders" in the investment space. With 50 supporters already onboard from around the world, the organization is tackling the complex challenges of enabling truly global investment flows.

Kassan expressed enthusiastic support for this vision, highlighting the fundamental disconnect in today's financial system: "There is such a need for democratization of investing right now with our global capital markets. Money is flying around our globe with really no limitations at all. But here we are trying to invest in our own communities, invest in businesses that we love and care about. And there's all these regulations that make it so hard for us to do that, not in our own country, let alone globally."

This observation cuts to the heart of the current paradox in global finance - institutional capital moves freely across borders, while individual investors face significant regulatory barriers when attempting to invest in businesses they care about, whether locally or internationally.

Regulatory Balance: Protection Without Restriction

Both leaders acknowledged the importance of appropriate regulation in protecting investors. However, they emphasized the need for proportionality in regulatory frameworks. As Field noted, "We understand the reason behind why they're there... We absolutely love the idea of regulation. It just has to be proportional perhaps."

Kassan added an important perspective on risk, pointing out that traditional public markets aren't risk-free either: "It's not like investing in the public capital of global markets isn't risky. And it's not like people don't lose money doing that." She highlighted that many public market investments simply move money around without creating productive economic activity, while crowdfunding investments flow directly to companies for productive use.

Real Economic Impact vs. Financial Circulation

One of the most compelling points raised during the conversation was the distinction between investments that create real economic value and those that merely circulate within financial markets. Kassan emphasized that crowdfunding investments go "directly to the company so they can do productive things," creating impact in the "real economy."

This perspective challenges the current imbalance where "almost everyone who has money to invest is investing in the global capital markets, not in their own communities or small businesses or non-public companies." Both leaders advocated for shifting a larger proportion of global investments toward non-public markets and community-based opportunities worldwide.

The conversation also highlighted how global crowdfunding could enable diaspora communities to invest in their countries of origin - creating powerful economic connections that current regulations often prevent.

Beyond Terminology: Investment Crowdfunding

Field and Kassan also touched on the importance of terminology and education. Field mentioned GECA's preference for the term "investment crowdfunding" rather than simply "equity crowdfunding," reflecting the broader range of investment models emerging in this space. Both organizations are committed to raising awareness about crowdfunding as a legitimate investment channel, particularly for helping startups and growth-stage companies thrive.

The Path Forward: Collaboration for Change

The conversation concluded with a commitment to continued collaboration between GECA and CfPA. This partnership represents an important step toward aligning international efforts to create more accessible, democratic investment pathways.

As these organizations work together, they face significant regulatory challenges but also unprecedented opportunities to reshape how capital flows to businesses globally. Their shared vision could help create a more inclusive financial system where individuals can invest in companies they believe in, regardless of geographic boundaries.

For more information about these organizations and how to get involved:

  • Global Equity Crowdfunding Alliance (GECA): thegeca.org
  • Crowdfunding Professional Association (CfPA): cfpa.org

 

by GECA

GECA Welcomes Equitable Finance Visionary Scott McIntyre to Steering Committee

The Global Equity Crowdfunding Association (GECA) is delighted to welcome Scott McIntyre - a trailblazer in capital formation and systemic innovation - to its Steering Committee. With over a decade in leadership driving crowdfunding into the mainstream, Scott has helped shape the infrastructure supporting modern alternative finance and economic development, aligning seamlessly with GECA’s commitment to democratizing access to capital and creating a truly borderless investment ecosystem.

A Crowdfunding Champion and Industry Architect

A co-founder and 10-term Chair of the Crowdfunding Professional Association (CfPA), Scott has been a consistent voice advocating for equitable U.S. crowdfunding policy since the passage of the JOBS Act in 2012. The CfPA works directly with legislators and regulators to advance transparent, inclusive rules that fuel entrepreneurial ecosystems and protect investors.

Scott's contributions to the field have been recognized at the highest levels globally - from being invited to the White House as a "Champion of Change”, to addressing Finance Ministers of the European Union at the invitation of the U.S. State Department, to his recognition by China to deliver the keynote speech at the first Global Crowdfunding Conference. Few in the industry match his creativity and breadth of experience in both policy advocacy and grassroots innovation.

"Scott is a visionary entrepreneur and tireless advocate" says Andy Field, GECA Steering Committee Lead. "His generosity and accomplishments in recruiting and managing key experts to volunteer their valuable time to such a pressing mission makes him an invaluable addition to our steering committee as we work to build a truly global crowdfunding ecosystem."

A Systems-Level Thinker with Local and Global Impact

Scott has addressed audiences in the tens of thousands across four continents, maintaining close ties with foreign leaders in 20+ countries through a vast network of innovation hubs, alternative finance organizations, and policymakers committed to equity-centered growth. 

Scott is distinguished not just by his technical skills, but his systems-level approach to economic transformation. As co-creator of the Sustainable Communities Framework (SCF) and founder of non-profit WEconomy-Us, he has pioneered replicable models that empower communities in crisis through interest-free capital and a truly free marketplace, alongside entrepreneurship and workforce development processes supporting regional production, adding resilience against global trade shifts.

From EdTech Pioneer to Alternative Finance Leader

Scott's entrepreneurial journey began in EdTech as a founding executive of REAL Education, launching as eCollege at IPO - one of the first scalable online learning platforms, later acquired by Pearson for $477 million. This background informs his deep belief in investor education as a cornerstone of economic participation, a value that aligns seamlessly with GECA’s fourth pillar.

His experience as a Director at The University of Toledo included designing and running the school’s first Office of Student Entrepreneurship and Engagement, giving him a ground-level view of the transformative impact of access to capital and counsel - a perspective that continues to guide his efforts in community economic development.

Driving Regenerative and Equitable Investment Models

Scott’s work extends into regenerative agriculture, sustainability, and the circular economy. As founder of Hemp Made Products, his plans are designed to advance industrial hemp ecosystems, turning farmers and their communities from stakeholders into shareholders in next-generation green industries.

This commitment to regenerative systems - financial, environmental, and social - positions Scott as a key contributor to GECA’s mission of building a future-ready, borderless investment ecosystem.

A Synergistic Fit with GECA’s Four Pillars

Scott brings deep alignment and active contributions to all four of GECA’s foundational pillars:

  • Cross-Border Collaboration: With a trusted global network of financial innovators and policymakers, Scott will accelerate GECA’s efforts to harmonize and scale borderless investment opportunities.
  • Standardized, Smarter Regulations: His direct involvement in helping shape U.S. crowdfunding policy positions him as a global leader in regulatory innovation that balances investor protection with access.
  • A Thriving Secondary Market: Scott's holistic understanding of capital markets will help advance GECA's vision for creating liquidity through robust secondary markets for crowdfunded investments.
  • Education & Investor Empowerment: As an educator and mentor, Scott has spent decades advancing financial literacy and inclusion - core to GECA’s commitment to investor empowerment.

Charting a Borderless Future for Equity Crowdfunding

“We’re not just reimagining access to capital -we’re building ecosystems employing new forms of capital that inclusively broaden paths to opportunity,” says Scott. “GECA’s vision for a truly borderless investment ecosystem naturally aligns with my life’s work repurposing capital to the benefit of the common good, not just the bottom line. Joining forces with Andy and the group of visionary leaders at GECA to bring equitable finance to more people globally was an easy decision.”

GECA is honoured to welcome Scott McIntyre to our Steering Committee and we look forward to his strategic insights, expansive network, and unwavering vision in this pivotal role.

To learn more about GECA's vision for borderless equity crowdfunding, download our manifesto or join our community today.

 

by GECA

Crowdfunding in an Interconnected World: GECA's Vision for a Borderless Future

The Profound Power of Global Interconnectedness

In today's world, the boundaries that once separated nations, economies, and communities have become increasingly permeable. As American philosopher Alan Watts eloquently expressed, "Each one of us, not only human beings but every leaf, every weed, exists in the way it does, only because everything else around it does. The individual and the universe are inseparable."

This interconnectedness isn't just philosophical - it's economic, social, and increasingly evident in our daily lives. From the 2008 financial crisis that rippled across global markets to the COVID-19 pandemic that transformed societies worldwide, we've witnessed firsthand how the spillover and domino effects of events in one corner of the world can reshape the entire global landscape.

At GECA (Global Equity Crowdfunding Association), we recognize that this interconnectedness isn't just a reality - it's an opportunity. It's the foundation upon which we can build a more equitable, accessible financial ecosystem that transcends borders and democratizes opportunity.

The Challenge: Financial Systems Built for Separation, Not Connection

Despite our interconnected reality, most financial systems - particularly those funding innovation and entrepreneurship - remain stubbornly tied to geographic boundaries. These artificial constraints create numerous challenges:

  • Innovation Bottlenecks: Revolutionary ideas emerging from regions with limited capital access struggle to find funding
  • Investor Limitations: Investors are often restricted to opportunities within their own borders, missing global potential
  • Capital Concentration: Funding gravitates toward established markets and demographics, reinforcing existing inequalities
  • Regulatory Fragmentation: Different rules across jurisdictions create unnecessary complexity and barriers

The research is clear: when we artificially constrain capital flows within national boundaries, we limit both economic potential and social progress. As the Arab Spring dramatically illustrated, social and economic pressures don't respect borders - they flow across them, creating both challenges and opportunities for transformation.

Crowdfunding: A Powerful Tool for a Connected World

Crowdfunding emerged as a natural response to our interconnected reality. It enables people to directly support causes, innovations, and individuals regardless of geographic proximity. The examples are compelling:

  • Social justice campaigns like "Time's Up Legal Defense Fund" that raised over $24 million to support survivors of sexual harassment and assault with legal resources
  • Wikipedia's transformation into a globally accessible knowledge repository through distributed support
  • Scientists like Angela Bosco-Lauth funding independent research when traditional channels failed
  • Medical campaigns that save lives when healthcare systems leave gaps

These examples demonstrate that when people can connect directly with causes and opportunities, remarkable things happen. But at GECA, we believe we've only scratched the surface of what's possible.

GECA's Vision: From Platform-Centric to Ecosystem-Centric Crowdfunding

Traditional crowdfunding platforms have made important strides, but they still operate largely within boundaries - geographic, regulatory, and structural. GECA envisions taking crowdfunding to its next evolutionary stage: a truly borderless ecosystem for equity investment that maximizes the potential of our interconnected world.

Our vision builds on four key pillars:

1. Cross-Border Collaboration

Recent research by Farè and Vismara (2025) conclusively demonstrates that international equity crowdfunding platforms significantly outperform their domestic counterparts. Their comprehensive analysis of 317 European platforms over 15 years found that international platforms:

  • Attract significantly more investors
  • Host more successful campaigns
  • Show greater resilience with lower termination rates
  • Are more likely to incorporate ESG (Environmental, Social, Governance) criteria

This isn't surprising - interconnection breeds success. At GECA, we're working to remove the remaining barriers to true cross-border investment, creating a seamless global ecosystem where capital can flow efficiently to the most promising opportunities regardless of location.

2. Standardized, Smarter Regulations

The European Crowdfunding Service Providers (ECSP) regulation has shown that harmonized regulatory frameworks can facilitate cross-border crowdfunding activities. GECA is advocating for and helping to develop global standards that maintain investor protection while removing unnecessary obstacles to international investment.

Instead of forcing platforms and investors to navigate dozens of different regulatory regimes, we envision a world where standardized protocols enable responsible cross-border investment everywhere.

3. A Thriving Secondary Market

For equity crowdfunding to reach its full potential, investors need liquidity. GECA is championing the development of robust secondary markets that allow investors to trade their equity stakes, creating the liquidity that will attract more participation and capital to the ecosystem.

The research shows that international platforms already attract larger, more diverse investor communities - the perfect foundation for developing these secondary markets.

4. Education & Investor Empowerment

Knowledge is the currency of the information age. GECA is committed to educating investors, entrepreneurs, and platforms about the opportunities and responsibilities of cross-border equity crowdfunding.

By empowering participants with knowledge, tools, and best practices, we can create a more transparent, efficient, and impactful ecosystem.

Beyond Platform Internationalization: True Ecosystem Integration

While research demonstrates the benefits of international platforms, GECA's vision goes further - toward true ecosystem integration. This means:

  • Interconnected Platforms: Rather than isolated international platforms, we envision an integrated network where deals, investors, and innovations flow seamlessly across platforms
  • Global Standards: Moving beyond regional harmonization to global principles that enable truly borderless investment
  • Impact-Focused Investment: Leveraging ESG orientation to channel capital toward ventures solving global challenges regardless of location

Real-World Impact: What Borderless Crowdfunding Can Achieve

When we remove artificial barriers to capital flow, extraordinary possibilities emerge:

Revolutionary Healthcare Solutions

Imagine a breakthrough malaria treatment developed by researchers in Kenya being funded by thousands of investors worldwide, bringing life-saving innovation to market years faster than traditional channels would allow.

Climate Innovation Acceleration

Picture climate technologies developed across different continents receiving funding not based on their geographic location but on their potential impact, accelerating our collective response to this global challenge.

Equitable Economic Development

Envision entrepreneurs in emerging markets accessing the same capital opportunities as their counterparts in wealthy nations, creating jobs and building prosperity in regions traditionally overlooked by venture capital.

Cross-Cultural Innovation

Consider the possibilities when innovations that combine cultural insights from different regions can find funding from a truly global community that appreciates their unique value.

Join GECA in Building the Borderless Future

The research is clear - internationalization benefits equity crowdfunding. But GECA's vision goes beyond the current state to imagine a truly integrated global ecosystem. We're working to make this vision reality through:

  • Advocacy for regulatory harmonization and global standards
  • Technology initiatives to connect platforms and create interoperability
  • Education programs for investors and entrepreneurs
  • Research partnerships to continuously improve the ecosystem

Our interconnected world demands interconnected financial systems. The challenges we face - from climate change to healthcare access to economic inequality - don't respect borders. Neither should our solutions.

In our increasingly connected world, we're witnessing the emergence of a new economic reality: when capital flows freely across borders, everyone benefits. The most promising solutions to humanity's greatest challenges can come from anywhere, and the wisdom of a truly global crowd can identify and nurture innovation more effectively than any centralized system

At GECA, we believe that equity crowdfunding represents more than just a funding mechanism - it's a fundamental reimagining of how capital, ideas, and opportunity can flow in a borderless world. By connecting entrepreneurs with global communities of investors who believe in their vision, we're not just financing businesses - we're weaving the fabric of a more collaborative, innovative and equitable global economy.

Join us in building the borderless future of equity crowdfunding. Together, we can create a world where capital flows freely to the ideas, entrepreneurs, and innovations that will shape a better tomorrow - regardless of where they originate.

Download the GECA Manifesto
Explore the Four Pillars of Crowd 2.0
Join GECA Today

 

by GECA

8 Pivotal Trends Reshaping Equity Crowdfunding in 2025

The equity crowdfunding landscape is undergoing rapid transformation. According to the latest market data, global crowdfunding is projected to reach US$ 5.43 billion by 2033, growing from US$ 1.45 billion in 2024 at a compound annual growth rate of 15.82%.

Recent research published in the Strategic Entrepreneurship Journal has revealed that 40% of successful equity crowdfunding campaigns would have failed without cross-border investment. This finding underscores the critical importance of international capital in today's crowdfunding ecosystem. Let's explore the eight key trends reshaping equity crowdfunding in 2025.

1. Regulatory Harmonization Driving Cross-Border Growth

The fragmented regulatory landscape has long been the primary barrier to global equity crowdfunding. This is changing rapidly as regulators create collaborative frameworks that allow platforms to operate across borders.

The 2024 ESMA Market Report shows that cross-border activity now accounts for 17% of all crowdfunding investments in the EU. This varies significantly by country – from 80% in Austria and Estonia to under 10% in nine EU member states. Countries with established regulatory frameworks consistently demonstrate higher crowdfunding activity.

This mirrors broader trends in cross-border investment, with PwC Luxembourg reporting that cross-border fund registrations reached 143,244 by the end of 2024, growing at 5.5% annually since 2014. The Financial Innovation Act of 2024 has already facilitated over 35 cross-border equity crowdfunding pilots, creating standardized compliance protocols while enabling seamless investor participation across jurisdictions.

2. AI-Powered Investment Matching

AI is revolutionizing how investors discover opportunities and how platforms evaluate campaigns. Advanced machine learning models now predict crowdfunding success with remarkable accuracy, even in a campaign's early stages.

Research by Elitzur et al. (2024) published in the Journal of Business Venturing Design analyzed more than 100,000 Kickstarter projects and found that machine learning models were superior to conventional statistical methods for predicting whether a crowdfunding campaign would reach its goal. Their research demonstrated that machine learning could identify complex, non-linear relationships that traditional regression models miss.

For example, while standard regression showed success decreased linearly as fundraising goals increased, machine learning revealed that a project's chances of success remained relatively stable up to a fundraising goal of $100,000, then began to drop, with a sharper drop-off over $133,300. Similarly, they found the optimal campaign duration was 10 to 15 days, and that offering between 15-20 reward options could actually have slightly negative effects compared to fewer options.

Machine learning's text analysis capabilities also identified specific project types that were less likely to succeed, information that could be crucial for both entrepreneurs and investors. This technological advancement is creating increasingly personalized investment experiences while significantly reducing information asymmetry between entrepreneurs and investors.

 

3. Blockchain Enabling Transparent Ownership and Trading

Blockchain technology has evolved from buzzword to essential infrastructure for equity crowdfunding. Smart contracts now automate compliance processes, cap table management, and dividend distributions while creating immutable ownership records.

Dacxi Chain is pioneering a transformation in global equity crowdfunding. In April 2025, they successfully completed the first cross-border equity crowdfunding pilot deal sharing between two platforms based in the EU. This breakthrough demonstrates how technology can overcome geographical limitations in equity crowdfunding, allowing entrepreneurs to access broader funding sources while giving investors exposure to opportunities beyond their local markets.

The Dacxi Chain team has been building the necessary technology for their comprehensive vision, with their blockchain scheduled to launch on Mainnet in late 2025. When fully implemented, their blockchain solution aims to further enhance cross-border investment capabilities.

Beyond Dacxi Chain's pioneering efforts, Securitize has emerged as the leading platform in the tokenized equity market, having issued over $3.3 billion in assets on-chain as of April 2025, including the largest tokenized equity at over $400 million.

By 2026, interoperable blockchain networks optimized for equity crowdfunding will allow investors to hold diversified portfolios of tokenized assets from multiple platforms in unified wallets. This will dramatically improve secondary market liquidity – historically a major challenge in equity crowdfunding.

4. Investor Attention as the Critical Success Factor

Research has conclusively shown that investor attention is the determining factor in cross-border crowdfunding success. Simply put, investors can't invest in what they don't see.

A recent study by Maula and Lukkarinen (2022) found that campaigns receiving more views from foreign countries are significantly more likely to receive investment from those countries. Platforms that have implemented international visibility features report substantial results, with Invesdor seeing a 62% increase in cross-border investment after implementing multilingual campaign pages.

Well-structured quantitative information (like financial metrics and equity allocation) has proven significantly more effective at attracting cross-border investment than qualitative content. This suggests platforms seeking to facilitate cross-border investment should prioritize standardized financial information that requires less cognitive effort for international investors to process.

According to academic research on promoting cross-border investing by business angels, cross-border investments typically only occur when investors have trusted relationships with local co-investors in the country where the investee business is located, making network development crucial for platforms that want to foster international capital flows.

5. Sector-Specific Platforms Driving Higher Success Rates

Generic crowdfunding platforms are giving way to specialized verticals with deep industry expertise. Platforms focusing on specific sectors consistently report higher success rates and larger raises compared to general platforms.

The 2024 ESMA report confirms this trend, showing that professional services (33% of funding) and construction/real estate (21% of funding) dominated the European crowdfunding market. Healthcare-focused platform RedCrow reports average campaign success rates of 78% compared to the industry average of 47%.

By year-end, we'll see dominant niche platforms in at least 12 major vertical markets (fintech, biotech, sustainability, real estate, etc.) offering specialized due diligence, industry-specific investor communities, and tailored post-investment support.

6. Impact Investing Growing Twice as Fast as Traditional Crowdfunding

Purpose-driven capital is changing the crowdfunding landscape, with impact investing growing significantly faster than traditional equity crowdfunding. According to the Global Impact Investing Network (GIIN), the worldwide impact investing market has now topped $1.571 trillion USD, reflecting its growing importance in the investment landscape.

Campaigns with clear environmental or social impact metrics raise 31% more capital on average than comparable campaigns without such metrics. This aligns with broader impact investing trends where investors seek both financial returns and measurable social or environmental benefits.

Platforms dedicated to impact investing have seen investor bases grow by over 60% in the past 24 months, significantly outpacing general crowdfunding growth. The GIIN's State of the Market 2024 report shows that most impact investors pursue risk-adjusted, market-rate returns, with portfolio performance overwhelmingly meeting or exceeding expectations for both impact and financial outcomes.

Impact metrics are becoming standardized across platforms, with third-party verification systems ensuring the legitimacy of sustainability claims. This trend toward evidence-based investment design and standardized metrics matches the core characteristics of impact investing identified by GIIN. We expect to see SDG (Sustainable Development Goals) alignment scores becoming standard in campaign listings by 2026.

7. Traditional Finance Integration Creating Hybrid Models

The boundaries between traditional finance and crowdfunding continue to blur. Banks, venture capital firms, and angel networks are increasingly participating in crowdfunded deals, creating hybrid capital models that combine institutional and retail investment.

Regulatory improvements have enhanced investor confidence, with research showing a 14% increase in decision accuracy following enhanced disclosure requirements. When traditional venture capital or angel investors participate in crowdfunding rounds, their presence serves as a powerful signal that helps retail investors process complex information more efficiently.

Recent empirical research demonstrates that angel investors and traditional financial institutions play complementary roles rather than competing ones in the equity crowdfunding ecosystem. As shown in comparative studies, venture capital typically enters at later stages of a company's growth cycle, while equity crowdfunding serves effectively in the pre-seed and seed stages. This complementary relationship creates a funding continuum where crowdfunding provides initial validation and capital, and traditional financial institutions offer growth funding and scaling expertise.

The integration of traditional finance with crowdfunding has created what researchers describe as a "funding escalator" - where successful crowdfunding campaigns often lead to subsequent venture capital rounds. Companies can leverage their crowdfunding success as proof of market validation, making them more attractive to institutional investors who can then provide larger amounts of capital for scaling.

These hybrid models enable small businesses to benefit from both worlds- gaining the community engagement and market validation aspects of crowdfunding while also accessing the stability, larger capital pools, and strategic resources provided by traditional funding sources. For many entrepreneurs, this combined approach offers a more comprehensive financing strategy that addresses different stages of growth.

Leading equity crowdfunding platforms actively encourage co-investment between the crowd and traditional financial institutions, recognizing the benefits of this hybrid approach. Research confirms that ventures with participation from both crowdfunding and traditional finance typically experience higher survival and growth rates, making this integration particularly valuable for early-stage companies.

8. AI-Driven Secondary Markets Improving Liquidity

The lack of liquidity has been equity crowdfunding's historical limitation. While secondary markets are emerging as a critical solution, the real transformation will come from AI-powered platforms that dramatically improve matching efficiency and market outcomes.

Secondary market transactions have seen impressive growth, rising from $51 billion in 2017 to $135 billion in 2021, with 2023 closing at $111 billion according to data from Campbell Lutyens. However, traditional secondary markets still face significant challenges in price discovery, matching buyers with sellers, and providing sufficient liquidity.

This is where AI-driven solutions are set to revolutionize the ecosystem. By leveraging advanced machine learning algorithms that analyze over 30 different parameters – including investment objectives, risk profiles, and holding time preferences – AI can dramatically improve matching efficiency between buyers and sellers. These systems won't just connect parties; they'll optimize the entire marketplace for maximum liquidity and fair pricing.

Early implementations of technology-enhanced secondary markets are already showing promising results. Seedrs Secondary Market has completed more than 22,000 secondary transactions and processes over £20 million in transactions annually. Their recent implementation of dynamic pricing technology has resulted in a 184% increase in total realized profit for sellers and an 80% improvement in clearance rate of listed shares.

But this is just the beginning. As AI capabilities advance, we'll see predictive analytics that can forecast optimal selling windows, recommend personalized investment opportunities based on investor profiles, and provide more accurate company valuations in environments with limited information. The AI trend would significantly improve outcomes for both buyers and sellers by reducing information asymmetries and transaction costs.

The potential benefits extend beyond transaction improvement. Platforms with integrated secondary markets report 42% higher investment volumes in primary offerings. When enhanced with AI, these markets could further accelerate capital formation by providing investors with greater confidence in future liquidity options. For example, a secondary share sale through Crowdcube's Cubex marketplace allowed early investors in Freetrade to enjoy a 47x (4,670%) return on investment without having to wait for a company exit – AI could make such success stories more common by optimizing timing and pricing.

For equity crowdfunding to reach its full potential, we need robust secondary markets. But to truly solve the liquidity challenge, we need AI-driven secondary markets that can process vast amounts of data, learn from market patterns, and continuously improve the efficiency of private equity trading. This represents the next frontier in democratizing access to both investment opportunities and liquidity options.

The Future: Crowd 2.0

These eight trends are converging toward what we at GECA call "Crowd 2.0" – a truly borderless, efficient ecosystem that unlocks the full potential of equity crowdfunding. In this future:

  • Entrepreneurs access capital from global investors through interconnected platforms
  • Investors discover opportunities worldwide, building diversified portfolios across geographies
  • Platforms collaborate rather than compete, creating powerful network effects
  • Regulators work together to protect investors while enabling innovation

The newly released ESMA Market Report shows that over €1 billion in crowdfunding already took place in the EU in 2023 alone. With the European Crowdfunding Service Providers Regulation (ECSPR) now implemented, these numbers are expected to grow substantially as cross-border investing becomes easier. 

Why Supporting GECA Matters

The Global Equity Crowdfunding Alliance (GECA) is the leading advocate for Crowd 2.0, working to remove barriers to cross-border investment and advance a truly global funding ecosystem.

Our advocacy addresses the most critical challenges facing equity crowdfunding:

  • Regulatory Fragmentation: Advocating for harmonized frameworks that enable cross-border investment
  • Industry Collaboration: Creating forums for platforms to develop shared standards and best practices
  • Investment Visibility: Advancing frameworks to help companies attract international attention
  • Trust Networks: Facilitating relationships between platforms and investors across borders

If you operate a crowdfunding platform, your support for GECA is crucial to building this future. Join us at thegeca.org to participate in working groups, share your data, and amplify the message of borderless equity crowdfunding.

The time for Crowd 2.0 is now.

Download the GECA Crowd 2.0 Manifesto to learn more about our vision for borderless equity crowdfunding.  

 

by GECA

Attention Across Borders: New Research Validates GECA's Vision for Global Equity Crowdfunding

A groundbreaking academic study provides compelling evidence supporting the core principles of Crowd 2.0

The Research That Changes Everything

Since our founding, we at the Global Equity Crowdfunding Alliance (GECA) have advocated for a borderless approach to equity crowdfunding - what we call "Crowd 2.0." We've maintained that with the right regulatory framework and industry collaboration, entrepreneurs could access capital from anywhere, and investors could participate in opportunities worldwide.

Now, pioneering research published in the Strategic Entrepreneurship Journal offers empirical validation of our vision while revealing a critical factor that must be addressed: investor attention.

The 2022 study - "What Drives Cross-Border Investments in Equity Crowdfunding? The Role of International Investor Attention" by Anna Lukkarinen and Markku V.J. Maula of Aalto University—provides the first comprehensive analysis of what truly drives international investment in equity crowdfunding campaigns.

The Data Speaks: Why Cross-Border Investment Matters

The researchers analyzed 17,191 investments across 187 campaigns on Invesdor, the first European platform with a MiFID license enabling cross-border equity crowdfunding. The results were striking:

  • 40% of successful campaigns would have failed without cross-border investment
  • A mere tripling of international page views increased cross-border investment odds by 60%
  • 1,469 investments came from investors in 64 different countries

This data confirms what GECA has long advocated: a truly global approach to equity crowdfunding isn't just desirable - it's essential for campaign success.

The Attention Bottleneck

The study's most important finding aligns perfectly with GECA's advocacy for greater global accessibility: investors can't invest in what they don't see.

While regulatory barriers have received significant attention (and rightly so), this research reveals another critical barrier: limited investor attention. In the researchers' words:

"A wealth of information creates a poverty of attention."

The data shows a clear causal chain:

  1. Campaigns that receive more views from foreign countries are significantly more likely to receive investment from those countries
  2. Marketing activities targeted at foreign investors drive attention
  3. This attention directly translates to investment

Beyond Distance: The Digital Revolution

Perhaps most surprising was the finding that once investor attention is captured, traditional barriers like geographic distance, cultural differences, and institutional variations have minimal impact on investment decisions.

This validates GECA's central premise: in a digital-first funding environment, artificial geographic boundaries should not limit capital flow.

The Four Pillars of Crowd 2.0: Research-Validated

This groundbreaking study provides empirical support for each of the four pillars of GECA's Crowd 2.0 vision:

1. Cross-Border Collaboration

The research confirms that platforms with cross-border capabilities (like Invesdor's MiFID license) enable significant international investment. However, it also reveals that regulatory access alone isn't enough - active cross-border visibility strategies are essential.

2. Standardized, Smarter Regulations

The study demonstrates that where regulatory frameworks enable cross-border investment (as with MiFID II in Europe), investors do take advantage of international opportunities. This validates GECA's call for harmonized global regulations.

3. A Thriving Secondary Market

While not directly addressed in the study, the findings on investor attention suggest that increased visibility of secondary market opportunities would similarly drive liquidity - a key GECA priority.

4. Education & Investor Empowerment

The research showed that investors are more likely to back campaigns when someone on the founding team shares their nationality. This highlights the importance of targeted education that helps investors understand opportunities across diverse contexts.

Implications for the Ecosystem

This research offers clear guidance for everyone involved in equity crowdfunding:

For Platforms:

  • Invest in tools that enhance international campaign visibility
  • Provide analytics on cross-border attention metrics
  • Facilitate multilingual campaign materials

For Entrepreneurs:

  • Highlight team diversity in campaign materials
  • Allocate marketing budget specifically for international investor targeting
  • Consider the attention economy as carefully as the funding target

For Regulators:

  • Recognize that effective cross-border frameworks must address visibility, not just legal access
  • Consider how investor education might vary across national contexts
  • Support standardization that makes cross-border campaigns more discoverable

For GECA and Industry Associations:

  • Advocate for attention-enhancing policies alongside regulatory reform
  • Develop best practices for international campaign visibility
  • Share cross-border success metrics that highlight attention factors

GECA's Path Forward

As an alliance advocating for global equity crowdfunding, this research reinforces our mission while highlighting new dimensions for our work:

  1. Regulatory Advocacy: Continue pushing for harmonized frameworks that facilitate cross-border investment, with added emphasis on visibility enhancement
  2. Industry Standards: Develop best practices for international campaign marketing and attention metrics
  3. Education Initiatives: Create resources to help investors discover and evaluate cross-border opportunities
  4. Platform Collaboration: Facilitate knowledge sharing among platforms about effective international visibility strategies

Conclusion: Attention Is the New Currency

The findings from Lukkarinen and Maula's landmark study validate GECA's vision for Crowd 2.0 while revealing a critical insight: in the battle for cross-border investment, attention is as important as regulation.

As we work toward our vision of a borderless investment ecosystem, we must recognize that opening regulatory doors is only half the battle. We must also ensure investors can see through those doors to the opportunities beyond.

This is why GECA exists - to advocate for a world where innovation knows no borders, where capital flows freely to the best ideas regardless of geography, and where both regulatory frameworks and visibility mechanisms enable truly global equity crowdfunding.

To join GECA in advancing global equity crowdfunding, visit thegeca.org.

Download our Crowd 2.0 Manifesto to learn more about our vision for borderless equity crowdfunding.

Reference: Lukkarinen, A., & Maula, M. V. J. (2022). What drives cross-border investments in equity crowdfunding? The role of international investor attention. Strategic Entrepreneurship Journal, 16(1), 129-159. https://doi.org/10.1002/sej.1424

by GECA

Crowdfunding Chronicles: Pioneering the Future of Borderless Investment – A Reflection on Episode 7 with Ruth Hedges

The Global Vision of Crowdfunding

The Global Equity Crowdfunding Alliance (GECA) stands as a beacon for a more interconnected, borderless investment landscape, fostering collaboration across nations to make equity crowdfunding accessible to all. In the latest episode of Crowdfunding Chronicles, Andy Field, Chair of the GECA Steering Committee, engages in an enlightening discussion with Ruth Hedges, a true pioneer in the industry, famously dubbed by Forbes magazine as the "Queen of Crowdfunding."

In this episode, we delve into the evolution of crowdfunding in the United States, the challenges it faces, and the untapped potential that remains within this space. This blog aims to unpack the insights from the episode, reflecting on the current state of crowdfunding and envisioning its future in a globally integrated economy.

The Birth of Equity Crowdfunding: A Journey from Recession to Regulation

Ruth Hedges’ journey into crowdfunding began not as an investor or platform owner but as an architect of the JOBS Act, which President Obama signed into law in 2012. This legislation laid the groundwork for Regulation Crowdfunding (Reg CF) in the U.S., democratizing access to investment opportunities for non-accredited investors.

However, as Ruth poignantly points out, the reality of equity crowdfunding’s adoption in the U.S. has fallen far short of expectations. Despite the framework enabling broad public participation, the industry has only raised a few billion dollars - a stark contrast to the multi-trillion-dollar cryptocurrency market, which emerged after crowdfunding but rapidly outpaced it in terms of financial activity.

This discrepancy raises critical questions: Why has equity crowdfunding not scaled as envisioned? What roadblocks have stifled its potential? And, most importantly, how can we unlock its true power?

 

Ruth Hedges, "Queen of Crowdfunding"

The Barriers to Crowdfunding’s Success in the U.S.

Ruth identifies three core barriers that have inhibited the growth of the equity crowdfunding industry in the U.S.:

1. Over-Regulation and Complexity

While the original draft of the Startup Exemption was just 22 pages long, by the time the JOBS Act regulations were implemented, the rulebook had ballooned to over 650 pages. These extensive compliance requirements make it challenging for startups to access funding efficiently and for investors to navigate the process.

Unlike gambling, the stock market, or even cryptocurrency trading - where regulations are either minimal or permissive - equity crowdfunding has been burdened with restrictions that limit marketing, cap investment amounts, and deter potential issuers from engaging with the system.

2. Lack of Awareness and Education

Despite being over a decade old, Reg CF remains largely unknown to the general public. Many incubators, accelerators, and even government agencies that support small businesses fail to educate entrepreneurs about equity crowdfunding as a viable alternative to venture capital or traditional bank loans.

As Ruth explains, during the COVID-19 pandemic, the U.S. government issued stimulus checks but failed to promote crowdfunding as a means for Americans to invest those funds into small businesses. If just a fraction of those funds had been directed towards Reg CF campaigns, the industry could have seen an explosive surge in capital inflow.

3. Fragmentation and Lack of Industry Collaboration

Perhaps one of the most critical insights Ruth shares is the lack of unity among crowdfunding platforms, stakeholders, and regulatory bodies. Unlike industries like consumer electronics - where companies like Apple, Sony, and Samsung engage in cooperative competition at global events like CES - equity crowdfunding platforms often operate in silos, failing to create a unified movement that promotes the industry as a whole.

GECA, with its mission of borderless crowdfunding, is a direct response to this issue - championing industry collaboration as the key to unlocking a global investment ecosystem.

The Future: Unlocking the True Potential of Equity Crowdfunding

So, what needs to happen for crowdfunding to truly become a mainstream financial instrument?

1. Reducing Bureaucratic Barriers

Governments and regulators must recognize that excessive red tape is not protecting investors but rather suffocating an industry with immense potential. Simplifying compliance requirements, removing investment caps, and allowing platforms to engage in more robust marketing could significantly accelerate industry growth.

2. Leveraging Technology: Blockchain and Tokenized Securities

The rise of blockchain and tokenized securities presents an opportunity to make cross-border crowdfunding seamless. By leveraging blockchain-based smart contracts, investments can be securely executed without intermediaries, reducing costs and enabling micro-investments on a global scale.

However, for this technology to be effectively integrated into crowdfunding, governments must create clear and favorable regulatory frameworks - ensuring that tokenized equity offerings are legally recognized.

3. Education and Public Awareness Campaigns

A major step forward would be nationwide and global education initiatives - involving universities, business incubators, and even mainstream media - to make equity crowdfunding a known and respected investment avenue.

Imagine a world where billboards in every major city, television ads, and influencers on TikTok and Instagram promote investment in small businesses through crowdfunding. This would shift public perception, fostering a culture of mass participation in economic development.

4. Industry-Wide Collaboration

The crowdfunding industry must unite - platforms, legal experts, marketers, and regulatory advocates must come together to create a global movement. This is where GECA plays a crucial role, advocating for a harmonized regulatory approach that allows for borderless investment.

By establishing international crowdfunding summits, cross-border funding syndicates, and standardized investment frameworks, the industry can break free from its current stagnation and unlock a new era of financial inclusion.

The Call for a Crowdfunding Renaissance

Listening to Ruth Hedges in Episode 7 of Crowdfunding Chronicles, one thing becomes abundantly clear: equity crowdfunding is at a crossroads. The potential for a thriving, borderless investment ecosystem exists, but realizing it requires a collective effort from industry leaders, regulators, and the global investor community.

GECA’s vision of borderless equity crowdfunding is not just an idea - it is a necessity for the modern global economy. If we can address the challenges outlined in this discussion, crowdfunding can finally take its place as the financial revolution it was always meant to be.

📌 Learn more about Ruth Hedges and her pioneering work in the crowdfunding industry: 👉 https://queenofcrowdfunding.com/ 

🎙️ Listen to the full GECA podcast featuring Ruth Hedges: 👉 https://youtu.be/Ehu8xeDaA4E?si=BRtHe11z69RRx30O 

Join the Movement

At GECA, we are committed to driving this transformation. If you are a crowdfunding portal or a stakeholder in the industry, now is the time to get involved and help shape the future of borderless equity crowdfunding.

📌 Join GECA today! 👉 https://thegeca.org/membership-app-form/

Be part of the global alliance working to foster innovation, collaboration, and industry growth.

👉 Follow GECA for the latest insights, partnerships, and global crowdfunding opportunities.

🚀 Let’s build the future of crowdfunding—together!

 

#Crowdfunding #GECA #EquityCrowdfunding #BorderlessInvestment #Blockchain #RegCF #FutureOfFinance

 

by GECA

Maximising ECSPR’s Impact: Key Insights & Strategic Reccommendations | GECA Roundtable (Jan 14, 2025)

Executive Summary

GECA recently hosted a roundtable discussion on Maximising ECSPR’s Impact, focusing on key issues such as SME funding, regulatory convergence, and the future of crowdfunding. Moderated by Andrew Field (GECA), the discussion featured industry experts Janine Donoghue (Green Crowd, Ireland), Nik Makris (Brikbee, Greece), Richard Austwick (BMS Group, UK), Clive Reffell (Crowdsourcing Week, UK), and Konstantin Boyko (Lenderkit, Netherlands).

The conversation centered on leveraging the European Crowdfunding Service Providers Regulation (ECSPR) to bridge SME funding gaps, achieve regulatory convergence, and build investor trust. Experts explored challenges, opportunities, and strategic insights to scale the equity crowdfunding sector, including:

  • Addressing SME funding gaps, particularly in sustainability and innovation.
  • Strengthening investor confidence through transparency and regulatory alignment.
  • Positioning equity crowdfunding as a viable complement to traditional financing.
  • Overcoming market fragmentation and expanding cross-border operations.

This report distills the roundtable’s key discussions into practical strategies for stakeholders, aiming to unlock ECSPR’s full potential and accelerate equity crowdfunding growth across Europe.

Context: The state of play for Equity Crowdfunding in Europe

The European crowdfunding market, despite significant growth, remains underdeveloped in equity funding, accounting for only 6% of total crowdfunding activity. ECSPR, introduced in November 2021, aims to harmonize regulations across member states, creating a unified market for investment- and lending-based crowdfunding. However, slow adoption and persistent regulatory disparities have limited its potential impact.

Key Statistics:
  • €600M in crowdfunding securities raised in 2023 – a testament to the growing relevance of the sector.
  • 65% of total crowdfunding funding through loans, highlighting a reliance on debt-based instruments.
  • 159 authorized crowdfunding platforms across the EU, with significant activity in France, the Netherlands, and Lithuania.

The discussion underscored the need for a coordinated effort to make equity crowdfunding a viable financing solution, particularly for SMEs in sustainability, digitalization, and innovation.

Unlocking ECSPR’s Potential for SME Funding

Bridging the Funding Gap

Participants emphasized the potential of ECSPR to address the €800 billion annual funding gap in the EU for critical sectors. Equity crowdfunding can complement traditional financing methods, but its growth depends on:

  • Investor Education: Many SMEs and potential investors remain unaware of the benefits and mechanisms of equity crowdfunding. Janine Donoghue noted that outreach to financial brokers and advisors could bridge this gap.
  • Targeting Niche Markets: Platforms like Green Crowd (Ireland) have demonstrated the efficacy of niche approaches, (for example, they focus on renewable energy projects). These specialized platforms can attract mission-driven investors and address underserved sectors.
Hybrid Financing Models

Nik Makris proposed some thinking around hybrid instruments blending equity and debt characteristics, such as mezzanine debt or preference shares. These products could offer investors clearer exit strategies, increasing their appeal compared to traditional equity models. Real estate and shipping were highlighted as sectors where such instruments could thrive.

Building Investor Confidence

Transparency and Standardization

Investor trust remains a cornerstone of crowdfunding growth. ECSPR’s provisions for standardized disclosures and risk warnings were debated. While some participants doubted their efficacy, they acknowledged their potential to align investor expectations and reduce information asymmetry.

  • Smart Contracts and Escrow Mechanisms: Clive Reffell highlighted the role of blockchain-based platforms in ensuring staged payments based on performance milestones. Such mechanisms could mitigate investor losses and enhance accountability.
Combating Negative Perceptions

Public skepticism about equity crowdfunding persists, with accusations of inflated valuations and inadequate due diligence. To counter this, platforms must:

  1. Strengthen Due Diligence: Platforms must rigorously vet projects to avoid defaults and fraud.
  2. Launch Awareness Campaigns: Unified marketing efforts by industry communities like GECA could reshape public perceptions and showcase success stories.

Achieving Regulatory Convergence

Challenges of Fragmentation

The roundtable identified regulatory inconsistency across member states as a significant barrier to scaling crowdfunding platforms. While ECSPR provides a framework, local regulators’ varied interpretations and licensing timelines hinder convergence.

  • Case Study: Greece: Nik Makris shared that the 14-month process to obtain a license disrupted business planning. Such delays are unsustainable for smaller platforms and discourage cross-border expansion.
Proposed Solutions
  1. Regulatory Knowledge-Sharing: Konstantin Boyko and others suggested establishing working groups to share best practices and align regulatory interpretations.
  2. Centralized Resources: It was suggested that ESMA could play a greater role in creating shared resources for regulators, reducing disparities in experience and expertise.

The Path to Scalability: Overcoming Market Barriers

Market Fragmentation

Fragmented markets, driven by linguistic, cultural, and economic differences, complicate cross-border operations. Participants advocated for:

  • Localized Partnerships: Platforms should collaborate with local entities to bridge knowledge gaps and access untapped markets.
  • Pooled Resources: Collective marketing and technology initiatives could lower entry barriers for smaller platforms.
Developing a Pan-European Secondary Market

Liquidity remains a critical challenge for equity crowdfunding. A pan-European secondary market could provide investors with exit opportunities, enhancing the sector’s appeal. This initiative would require collaboration between regulators, platforms, and financial institutions.

Strategic Recommendations for Stakeholders

For Platforms:
  • Invest in investor education and transparent communication.
  • Explore innovative financing instruments, such as hybrid models and smart contracts.
  • Focus on niche markets to build competitive advantages.
For Industry Bodies and Policymakers:
  • Conduct pan-European awareness campaigns highlighting crowdfunding’s potential.
  • Facilitate partnerships between platforms to share best practices and resources.
  • Advocate for regulatory clarity and alignment at the EU level.
For Regulators:
  • Streamline licensing processes and reduce approval timelines.
  • Foster regulatory harmonization through structured knowledge-sharing initiatives.
  • Encourage the development of secondary markets to enhance liquidity.

A Unified Vision for Equity Crowdfunding

The GECA roundtable marked a pivotal step in aligning stakeholders around a shared vision for the future of equity crowdfunding. By tackling regulatory fragmentation, investor skepticism, and market barriers, the sector can unlock its full potential as a critical tool for SME funding and economic growth.

GECA and its supporters are uniquely positioned to lead this transformation, leveraging ECSPR to foster a thriving, inclusive, and scalable crowdfunding ecosystem.

Join the Conversation!
If you're passionate about shaping the future of global cross-border crowdfunding, we invite you to become a GECA supporter and connect with industry leaders.

Sign up today:https://thegeca.org/membership-app-form/

by GECA

Globalizing Equity Crowdfunding: Unlocking the Future of Borderless Investments

Equity crowdfunding has emerged as a transformative financing tool, reshaping the entrepreneurial and investment landscapes. For startups, it offers an accessible pathway to secure funding without the traditional constraints of venture capital or bank loans. For investors, it democratises participation, enabling individuals to support early-stage ventures with modest contributions. Despite its promise, the full potential of equity crowdfunding remains untapped due to its fragmented, localised nature.

The globalisation of equity crowdfunding is essential to creating a seamless, borderless investment ecosystem. By enabling cross-border transactions and harmonising regulatory frameworks, this shift can democratise access to capital, spur innovation, and foster global economic growth. This article explores why globalising equity crowdfunding is necessary, its benefits, and the steps required to achieve it.

What Is Equity Crowdfunding?

Equity crowdfunding allows individuals to invest in startups and small businesses in exchange for equity or equity-like returns. Unlike reward-based crowdfunding, where backers receive non-monetary incentives, equity crowdfunding aligns investors with a company’s financial success. It also differs from debt-based crowdfunding, where investors lend money in return for fixed interest payments.

In recent years, equity crowdfunding has gained traction as a viable financing alternative for entrepreneurs. According to Business Research Insights the equity crowdfunding market was valued at approximately USD 1.41 billion in 2023 and is projected to reach USD 4.51 billion by 2032, growing at a compound annual growth rate (CAGR) of 13.8% during the forecast period (Source: Business Research Insights, December 2024). This growth is driven by the increasing awareness of crowdfunding’s potential to democratise capital access, particularly in underserved regions.

The Current State of Equity Crowdfunding

The equity crowdfunding ecosystem has witnessed significant growth, with platforms like Seedrs in the UK, Republic in the US, and Birchal in Australia offering innovative ways to connect investors with startups. However, the landscape remains fragmented due to differing regulatory requirements across regions, complicating cross-border investments.

While some platforms have made strides in enabling global deals, they still face operational challenges in complying with the securities laws of each jurisdiction. For instance:

  • Seedrs and its parent company, Republic, are pioneering the ability for businesses to raise funds simultaneously in the US, UK, and EU. Randal MacDonald, head of Seedrs’ Dublin office, highlighted to BeBeez International that Republic and Seedrs are positioned as the only global provider offering this capability. The first global raise under this model occurred in 2024.
  • Despite these advancements, platforms must still address local regulatory nuances, which often require establishing a presence or partnerships in the target country.

While platforms like Seedrs and Republic have demonstrated operational capacity and innovation, the broader industry is hindered by the lack of harmonised regulatory frameworks. These barriers make it challenging for startups to attract international funding efficiently and for investors to build truly global portfolios. Inconsistent due diligence practices and the absence of interoperability among platforms further exacerbate these challenges, stalling the seamless globalisation of equity crowdfunding.

The Case for Globalising Equity Crowdfunding

  1. Economic Benefits
    Globalizing equity crowdfunding would unlock significant economic value by connecting startups and investors worldwide:
  • Access to Capital: Startups in underfunded regions, particularly in developing economies, could attract international investors, bridging capital gaps.
  • Investor Opportunities: Globalization allows investors to support innovative companies from diverse markets, increasing portfolio diversification and exposure to high-growth sectors.
  • Efficiency: A larger investor pool reduces funding gaps, accelerates fundraising timelines, and enhances capital efficiency.
  1. Technological Advancements
    The rise of blockchain technology and digital platforms enables secure, transparent, and efficient cross-border transactions. For instance:
  • Blockchain ensures tamper-proof records of ownership, increasing trust among investors.
  • AI-driven platforms can streamline due diligence processes, reducing friction in cross-border investments.
  1. Promotion of Innovation
    Globalization fosters innovation by funding startups with unique ideas across diverse cultural and economic contexts. Increased competition drives higher-quality ventures, elevating standards across industries.

      4. Cultural Exchange
        Equity crowdfunding creates opportunities for cross-cultural collaboration. Investors and entrepreneurs can share ideas, fostering mutual understanding and            global innovation. Ventures funded globally also contribute diverse cultural influences to their target markets, enriching the global economy.

Why Globalisation Is Necessary Now

  1. Economic Interdependence
    The global economy is more interconnected than ever, with startups and SMEs driving growth. Industries like renewable energy, fintech, and healthcare are increasingly reliant on international collaboration and funding. Equity crowdfunding can catalyse these sectors by providing seamless access to global capital.
  2. Regulatory Developments
    Recent initiatives, such as the European Crowdfunding Service Provider Regulation (ECSPR), demonstrate the feasibility of harmonizing crowdfunding regulations. These frameworks can serve as a blueprint for global standardisation, enabling smoother cross-border operations.
  3. Demand for Diversification
    Investors increasingly seek to mitigate risk by diversifying across geographies and sectors. Emerging markets, in particular, present lucrative opportunities for high-growth investments. Globalising equity crowdfunding can meet this demand by providing access to a wider range of ventures.

Challenges to Globalising Equity Crowdfunding

  1. Regulatory Barriers
    Divergent securities laws and compliance requirements remain significant hurdles. Startups often face duplicative or conflicting regulations when raising capital internationally, while investors encounter barriers to accessing foreign markets. Standardising these frameworks is critical.
  2. Technological and Operational Hurdles
    Ensuring platform interoperability and data security across jurisdictions is a technical challenge. Additionally, addressing language barriers, currency exchange complexities, and cultural differences requires significant investment in platform development.
  3. Trust and Transparency
    Fraud and governance concerns can deter investors from participating in cross-border equity crowdfunding. Establishing globally accepted ethical standards and robust due diligence practices is essential to building trust.

How Globalisation Would Positively Impact the Industry

  1. Economic Growth and Job Creation
    Startups can scale faster with access to international capital, creating jobs and driving economic development. For instance, globalized crowdfunding could help renewable energy startups expand operations, contributing to the green economy.
  2. Global Standards and Best Practices
    Harmonised regulations improve investor protections, streamline compliance, and reduce friction for startups entering international markets. Standardized practices also foster greater investor confidence.
  3. Broader Investor Participation
    Globalisation enables retail investors to access diverse opportunities traditionally reserved for institutional investors. By expanding the retail investor base, crowdfunding platforms can achieve higher funding volumes and greater market reach.
  4. Cultural and Social Impact
    Equity crowdfunding empowers entrepreneurs from marginalised regions, giving them visibility and funding opportunities. It also encourages global collaboration, enriching perspectives and fostering innovation through diverse experiences.

Strategic Path Forward

  1. Developing a Global Framework
    Intergovernmental organisations like the WTO, UN and IOSCO can play a pivotal role in fostering harmonised policies. The ECSPR offers a model for developing global standards, with lessons applicable to other regions.
  2. Leveraging Technology
    Platforms should adopt blockchain for secure and transparent transactions and AI for fraud detection and enhanced due diligence. These technologies can address operational challenges and improve efficiency.
  3. Building Trust
    To overcome skepticism, platforms must implement rigorous vetting processes and provide investor education. Promoting success stories of globalised crowdfunding campaigns can also build credibility.
  4. Encouraging Collaboration
    Partnerships between platforms, regulators, and stakeholders are essential for developing shared goals and standards. Industry alliances like the Global Equity Crowdfunding Alliance (GECA) can spearhead efforts to create a unified ecosystem.

Conclusion

Globalising equity crowdfunding represents a transformative opportunity to unlock the future of borderless investments. By connecting startups and investors across geographies, it democratises access to capital, fosters innovation, and drives global economic growth. While challenges remain, strategic efforts to harmonise regulations, leverage technology, and build trust can pave the way for a seamless investment ecosystem.

Now is the time for regulators, platforms, and stakeholders to act decisively. Together, we can shape a future where equity crowdfunding transcends borders, empowering entrepreneurs and investors to collaborate on a truly global scale.

Join the movement and become a supporter of the Global Equity Crowdfunding Alliance (GECA). By uniting with industry leaders, you’ll gain access to resources, forums, and opportunities to help shape the future of equity crowdfunding.
👉 Apply to become a supporter here.

by GECA

The Global Equity Crowdfunding Alliance: Reflecting on a Milestone Inaugural Year.

As 2024 comes to a close, we find ourselves at an incredible juncture in our journey with the Global Equity Crowdfunding Alliance (GECA). What started in May as a vision to transform the equity crowdfunding industry has quickly grown into a thriving global initiative, uniting equity crowdfunding, stakeholders across borders.

Our story began with a simple yet ambitious realisation: The true potential of equity crowdfunding, is limited by national boundaries. We saw an opportunity to build a collaborative ecosystem—one that empowers entrepreneurs with greater access to capital and enables investors to participate in deals that resonate, regardless of geography. This vision isn’t just about funding; it’s about unlocking untapped potential to create a more equitable and interconnected future.

In our first six months, we’ve made extraordinary progress. GECA now has the support of 40 organizations spanning the Americas, Europe, the UK, and Asia. This level of support underscores the industry’s readiness to embrace a shared mission for borderless crowdfunding and cross-border investment. The enthusiasm from industry leaders and stakeholders has been phenomenal—it’s clear that the need for this alliance is real and urgent.

Milestones of 2024

  1. Steering Committee Leadership:
    Our independent steering committee has been instrumental in shaping our path forward. With diverse expertise and commitment to our mission, these fantastic industry leaders from across the globe have guided GECA with passion and insight. I encourage everyone to learn more about these extraordinary individuals here.
  2. CrowdCon 2024:
    In September, GECA proudly participated in CrowdCon 2024 in Brussels, co-hosted by Eurocrowd and Fintics. The event was a powerful reminder of the value of collaboration, as industry leaders tackled the complexities of regulatory alignment and digital finance. GECA used this platform to advance critical conversations, demonstrating our role as a unifying force in the industry.
  3. Crowdfunding Chronicles Podcast:
    This year also saw the launch of the Crowdfunding Chronicles podcast, where thought leaders shared groundbreaking ideas and expertise. These conversations have ignited inspiration within the global community, and we’re thrilled to announce new episodes launching early in 2025. You can listen to the podcast series here.

Looking Ahead: A Collaborative Vision for Equity Crowdfunding

The future of equity crowdfunding is bright and 2025 has the potential to be a transformational year. We will begin our research program in the new year and our supporters will be asked to play a key part by taking part in a survey that is designed to prioritise our focus on the issues which matter the most. As we kick off the new year, we’ll launch a series of roundtable discussions aimed at gathering the expert views and opinions of our supporters. The insights gained from these discussions will be instrumental in strengthening our research program, as we share them with our members and policymakers to drive meaningful impact.

The road ahead may be challenging, but the opportunities are boundless. With over 2 billion people online and connectivity expanding at an extraordinary pace, we firmly believe that we stand at the cusp of a new era. By leveraging the expertise and guidance of our supporters and building a transparent, global ecosystem, GECA will lead the charge in helping create an equity crowdfunding future defined by innovation, shared success, and global impact.

Join Us on This Journey

As we move forward, we’re focused on growing our alliance and gaining critical mass. Supporting GECA offers unparalleled access to industry insights, exclusive events, and the chance to help shape the future of crowdfunding. This is your opportunity to be part of a movement that will transform the industry.

Together, we can make the difference needed to take equity crowdfunding to the next level. The market is consolidating, and now is the time to act—to build confidence, embrace innovation, and drive a revolution that benefits everyone.

Happy Holidays and a Prosperous New Year!

To every member, supporter, and advocate: thank you for believing in GECA’s vision. Your dedication fuels our work and inspires us to reach for even greater heights. On behalf of our entire community, I wish you a joyous holiday season and an extraordinary 2025.

Warm regards,
Andy Field
Executive Lead, Steering Committee
Global Equity Crowdfunding Alliance

 

by GECA