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.
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:
- Campaigns that receive more views from foreign countries are significantly more likely to receive investment from those countries
- Marketing activities targeted at foreign investors drive attention
- 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:
- Regulatory Advocacy: Continue pushing for harmonized frameworks that facilitate cross-border investment, with added emphasis on visibility enhancement
- Industry Standards: Develop best practices for international campaign marketing and attention metrics
- Education Initiatives: Create resources to help investors discover and evaluate cross-border opportunities
- 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
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?
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
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:
- Strengthen Due Diligence: Platforms must rigorously vet projects to avoid defaults and fraud.
- 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
- Regulatory Knowledge-Sharing: Konstantin Boyko and others suggested establishing working groups to share best practices and align regulatory interpretations.
- 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/
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
- 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.
- 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.
- 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
- 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. - 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. - 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
- 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. - 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. - 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
- 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. - 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. - 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. - 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
- 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. - 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. - 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. - 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.
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
- 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. - 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. - 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
Evolving with Integrity: Reflecting on Crowdfunding Regulation in the UK and UK Crowdfunding's Path Forward
The landscape of UK crowdfunding is at a critical juncture, highlighted by national discussions on the challenges posed by current regulations. A recent article by James Hurley in The Times underscores the UK Crowdfunding Association’s (UKCFA) concerns about potentially stifling regulations enforced by the Financial Conduct Authority (FCA). We thought we’d take a look at these issues and as we fully support a regulatory environment that fosters innovation while ensuring robust investor protection. This aligns with our mission to support sustainable, global growth in equity crowdfunding.
In his article, James Hurley brings attention to a letter from the UKCFA to the Economic Secretary to the Treasury, which requests an independent review of the FCA’s impact on business finance and investment. Highlighted by the UKCFA and discussed by Hurley, there is a pressing concern that over-regulation could be detrimental to the UK economy, potentially resulting in up to £16 billion in lost investment opportunities. This perspective sets the stage for a broader discussion on finding a balance between investor protection and industry growth.
GECA’s Role in Shaping Crowdfunding:
As an advocate for borderless equity crowdfunding, GECA plays a pivotal role in this discourse. Our mission is not only to promote the efficiency and scalability of crowdfunding platforms globally but also to advocate that these platforms operate in a regulatory environment that is conducive to innovation and broad investor participation. GECA’s efforts are geared towards harmonizing regulations across jurisdictions to reduce barriers and enable a truly global investment landscape.
Reflecting on the concerns detailed in Hurley’s Times article, it is crucial for the crowdfunding industry to engage in constructive critique and dialogue about existing regulations. The FCA’s current measures, while well-intentioned for consumer protection, may inadvertently hinder the growth of a vibrant crowdfunding ecosystem by imposing rigid constraints that could deter new investors and stifle entrepreneurial ventures.
The Advantages of Reexamining Regulation:
Revisiting these regulations is not merely a bureaucratic exercise; it has tangible benefits for all stakeholders:
- For Entrepreneurs: Streamlined regulations can lower the barriers to entry, allowing more innovative startups to access capital.
- For Investors: A balanced regulatory approach increases the market's attractiveness through enhanced safety and potentially higher returns.
- For the Economy: More successful startups and higher investment activity contribute to economic growth and job creation.
Recommendations for next steps:
- Independent Review and Analysis: In line with the UKCFA’s suggestion reported by Hurley, an independent review could provide empirical evidence necessary for adjusting regulations effectively to support economic growth without compromising investor safety.
- Proportionate Regulations: Such a review should advocate for proportionate regulations that protect investors but are also pragmatic enough to foster innovation and market competitiveness.
- Stakeholder Engagement: GECA champions ongoing dialogue between crowdfunding platforms and regulators like the FCA. This approach ensures that the regulatory framework adapts to the realities of modern fundraising and investment practices.
- Promoting Transparency and Education: Enhancing the transparency of these regulatory processes and increasing educational outreach can mitigate risks more effectively than restrictive measures alone.
We encourage all stakeholders within the crowdfunding ecosystem to participate in this pivotal conversation about our industry’s future. Your insights are invaluable in shaping a regulatory landscape that nurtures growth while safeguarding investors. GECA provide it’s supporters with opoprtunities to connect and engage with each other about many issues affecting our industry. Supporting us costs nothing and you can apply to become a supporter here
Welcoming Konstantin Boyko to the GECA Steering Committee
We are excited to announce that Konstantin Boyko, CEO/Co-founder of LenderKit and Crowdspace, has joined the Steering Committee of the Global Equity Crowdfunding Alliance (GECA). Konstantin brings a robust background with over 15 years in the FinTech and crowdfunding sectors, enhancing our collective expertise.
Profile of Konstantin Boyko
Konstantin's contributions to the crowdfunding world through LenderKit— software that facilitates the launch of capital-raising and crowdlending platforms—are well-recognized. His work has influenced crowdfunding operations in regions including MENA, USA, Europe, and Asia, reflecting his global outlook and commitment to financial technology innovations. Additionally, his involvement with CrowdSpace, an educational hub for the crowdfunding community, demonstrates his commitment to fostering industry growth and collaboration.
His engagement in substantial industry research and analysis, particularly in collaboration with the Crowdfunding Research Center in Adger, Norway, underscores his commitment to the crowdfunding community's growth and learning. Konstantin's academic pursuits, including an advanced study in Mathematics, equip him with a unique analytical approach to solving complex FinTech challenges.
As a new member of GECA's Steering Committee, Konstantin will help guide our strategic direction, particularly in enhancing technological adoption across global markets. His vision for integrating advanced digital tools aligns with GECA's goals of fostering accessible and efficient crowdfunding platforms worldwide.
Konstantin's involvement is set to be instrumental in our ongoing initiatives, contributing to our mission of shaping a seamless and inclusive framework for global equity crowdfunding. Welcome, Konstantin! We look forward to the innovation and leadership you bring to our alliance.
For further information on Konstantin’s initiatives, please visit Lenderkit and Crowdspace
CrowdCon 2024: Strategic Insights for GECA as We Work Towards a Unified Future for Equity Crowdfunding
The 13th edition of CrowdCon, held on September 26-27, 2024, in Brussels, served as a significant forum for the European crowdfunding sector. Co-hosted by Eurocrowd and Fintics, the conference brought together industry leaders to address complex issues around regulatory alignment and the evolution of digital finance. Established in 2013, Eurocrowd has positioned CrowdCon as a central event for shaping the future of crowdfunding through rigorous policy discussions and cross-sector collaboration.
GECA’s Strategic Engagement at CrowdCon 2024
At CrowdCon, the Global Equity Crowdfunding Alliance (GECA) took a dedicated approach, taking part in key discussions on regulatory convergence within a growing and often challenging digital finance ecosystem. This year’s event presented GECA with an invaluable chance to expand its network and learn from those who have previous experience in navigating regulatory complexities. In a landscape where EU crowdfunding has often been constrained by fragmented regulations, GECA’s involvement at CrowdCon represents an important step in positioning itself as a committed industry partner, focused on progressing sustainably on a Global level within this rapidly evolving field.
EU Market Challenges and the Evolution of Crowdfunding Regulations
The EU’s crowdfunding sector has historically trailed other global markets, largely due to regulatory fragmentation, which has hampered cross-border operations and elevated compliance costs. It could be said that this complexity has inhibited platform growth and limited financing diversity for small businesses and investors.
In November 2021, after years of advocacy and foundational work by Eurocrowd, the EU introduced harmonized crowdfunding regulations, granting platforms the ability to apply for an “EU passport” to operate across member states under one set of rules. This regulatory milestone reduces entry barriers, streamlines platform operations, and expands cross-border investment opportunities, all while enhancing investor protections. The framework is seen as a crucial, albeit challenging, pathway to transforming the European crowdfunding landscape.
GECA’s Mission and Approach at CrowdCon
For GECA, CrowdCon 2024 was an essential opportunity to contribute meaningfully to industry dialogue on regulatory and operational change in crowdfunding. Andrew Field, Executive Lead of GECA’s Steering Committee, led the alliance’s efforts, emphasizing that GECA aims to advance regulatory conversations and build a robust network of industry supporters while remaining acutely aware of the task’s magnitude. GECA’s objectives for CrowdCon included:
- Knowledge Exchange: Engaging with stakeholders to understand the practical impacts of EU regulations and learn from early implementation successes and challenges.
- Visibility and Advocacy: Communicating GECA’s commitment to data-driven policy-making, with an emphasis on working collaboratively to gather insights from across the sector.
- Networking and Learning: Learning from industry veterans and peers, particularly leveraging Eurocrowd’s substantial experience, and fostering best practices for regulatory engagement.
This involvement underscored GECA’s commitment to achieving an investment ecosystem that promotes innovation—one that will require a collective and sustained effort from all stakeholders. GECA’s dedication to bringing meaningful change was articulated but it was also emphasized that this journey is an incremental process requiring both collaboration and a profound understanding of the complexities involved.
Key Takeaways from CrowdCon 2024: Progress and Future Challenges for Crowdfunding
- Regulatory Developments and Progress:
Mindaugas Valiulis from the European Commission led a discussion on the European Crowdfunding Service Providers Regulation (ECSPR). Three years into its implementation, ECSPR has achieved considerable progress. However, as Valiulis noted, unifying Europe’s crowdfunding landscape remains a work in progress. Joachim Schwerin echoed this, emphasizing the importance of ECSPR in creating a cohesive, cross-border environment for innovation but acknowledging the challenges that persist. - The Global Expansion Debate:
A panel discussion explored the complexities of international crowdfunding expansion, with Dacxi Chain providing insights into the potential of blockchain to bridge European and international markets. Ed Ludbrook - founder of Dacxi Chain, discussed the role of distributed ledger technology in facilitating large-scale investment from North America and Asia-Pacific into European projects, which, while promising, requires careful regulatory navigation to succeed globally. - Blockchain Innovations in Crowdfunding:
The potential of Distributed Ledger Technology (DLT) in equity crowdfunding was highlighted by Andreas Knopf from Invesdor and Dr. Johannes Schmitt of Nyala, who discussed blockchain’s role in simplifying bond registry processes. These advances are part of an emerging trend where digital innovation supports increased transparency and efficiency in financial products, though substantial regulatory groundwork will be needed for widespread adoption. - Crowdfunding for Social Good:
In a session led by Giselle Borg Olivier of Zaar Crowdfunding, discussions focused on the societal impact of crowdfunding, with leaders such as Charlotte Brandsma of Growfunding and Nuno Jorge of Goparity emphasizing the importance of public trust and engagement. These discussions highlighted crowdfunding’s capacity to fund community-centered initiatives, revealing its broader role as a social tool as well as a financial mechanism.
Key Insights and Emerging Trends in Global Equity Crowdfunding
- EU as a Global Benchmark:
CrowdCon discussions affirmed that Europe’s approach to regulatory harmonization could serve as a model for other regions. However, adapting this framework on a global scale will require substantial, coordinated efforts from regions worldwide to accommodate diverse financial ecosystems. - The Vision for a Global Crowdfunding Framework:
Attendees were optimistic about Europe’s progress and recognized the potential for similar frameworks in other regions to unlock international crowdfunding opportunities. Yet, these frameworks will need careful customization and collaboration to support meaningful cross-border investment. - Pathway to a Globalized Equity Crowdfunding Market:
Europe’s regulatory advances provide a promising foundation, but achieving a truly unified, global crowdfunding landscape will demand sustained collaboration and a deep understanding of regulatory constraints across regions.
Reflecting on GECA’s Growing Role and Future Directions
GECA’s Strategic Vision
Andrew Field’s session on “Innovation in a Borderless Investment Landscape” encapsulated GECA’s commitment to fostering a unified crowdfunding environment. During this discussion, Andrew outlined GECA’s strategy: a steady, multi-step approach toward becoming a trusted industry partner to help promote (where necessary to facilitate innovation) positive regulatory change. His insights conveyed GECA’s commitment to working alongside stakeholders, learning from the challenges they have faced, and positioning GECA as a practical, adaptable ally in a complex industry.
The positive feedback received from other delegates underscores GECA’s potential as a contributor to industry-wide change. However, Andrew was keen to stress that the journey toward a borderless investment ecosystem requires not only ambition but also a readiness to listen, learn, and refine strategies as GECA grows within the field.
Feedback and Growing Influence of GECA
Participant Reactions and Expanding Global Engagement
Attendees appreciated GECA’s constructive, solution-oriented approach to regulatory harmonization and were encouraged by the alliance’s commitment to engaging with complex industry issues. Notably, GECA’s network of supporters now extends beyond Europe, reaching regions such as the U.S., New Zealand, UAE, and Africa. This expanding international presence highlights GECA’s resonance in diverse markets, reinforcing its potential to build a harmonized framework for equity crowdfunding.
Increasing Relevance and Strategic Path Forward
The insights gained at CrowdCon validate GECA’s mission and reflect an increasing openness within the global crowdfunding community to align on best practices. As GECA grows its network and continues to engage with key stakeholders, its role as a catalyst for harmonization in equity crowdfunding becomes more attainable yet remains anchored in the need for sustained, collaborative effort.
Next Steps: GECA’s Strategic Vision and Planned Actions
- Building on CrowdCon Insights:
The conference provided GECA with valuable input, which will be instrumental in refining its strategic initiatives. The alliance is committed to making incremental changes that reflect both the needs of its members and the broader crowdfunding landscape. - Actionable Next Steps:
GECA will prioritize translating CrowdCon insights into tangible initiatives, ensuring that its approach aligns with the practical requirements of stakeholders and supports sustainable industry growth. - Continued Research, Engagement and Dialogue:
Looking ahead, GECA will host events that foster ongoing dialogue, helping members stay current with global trends and challenges in the equity crowdfunding sector. These sessions are designed to nurture collaboration, promote shared learning, and empower stakeholders to shape the future of equity crowdfunding. GECA will utilize it’s growing connection to conduct high quality primary research that will identify and capture the true needs and desires of start up businesses, investors and equity crowdfunding platforms on a Global basis.
Conclusion: Moving Towards a Unified Equity Crowdfunding Future
CrowdCon 2024 offered GECA critical insights into the current and future state of equity crowdfunding, with discussions underscoring a shift towards regulatory harmonization. However, achieving this vision will demand dedication, cooperation, and strategic adaptability. The industry’s support of GECA’s mission reflects a collective readiness to address regulatory challenges, but the path to a unified crowdfunding ecosystem requires both ambitious goals and a grounded understanding of the work required.
Invitation to Join the Mission
As GECA advances its efforts, it invites current and prospective supporters to join this journey, contributing to the development of a global crowdfunding framework. The insights from CrowdCon 2024 mark an important milestone, setting the stage for a future where cross-border investment can flourish through collaboration and informed, deliberate action.
Welcoming Aaron Shafton to the GECA Steering Committee
We are thrilled to announce that Aaron Shafton, Senior Director at DealMaker Securities (an affiliate of DealMaker.tech), has joined the Global Equity Crowdfunding Alliance (GECA) Steering Committee. Aaron brings a wealth of experience, passion, and strategic vision to the table, and we are thrilled to have him on board as we continue to strive to shape the future of global equity crowdfunding.
Aaron Shafton: An Innovative Leader in Capital Markets
Aaron’s career spans various industries, including fintech, e-commerce, and finance. Prior to joining DealMaker, he held positions at companies such as Shopify, Capital One, and Procter & Gamble. His diverse experience has provided him with deep insights into online capital raising and strategic business growth.
Joining DealMaker in 2019 as an early team member, Aaron played an important role in the company's impressive growth, and helped scale the team to over 100 employees. He has contributed in transforming DealMaker into a powerhouse in the equity crowdfunding industry. At DealMaker, Aaron leads a team focused on compliance, strategic partnerships, and capital markets innovation. His role is critical in guiding companies through sophisticated, large-scale transactions, ensuring they leverage DealMaker's cutting-edge technology to raise capital efficiently and effectively.
Aaron Shafton’s Role on the GECA Steering Committee
As part of the GECA Steering Committee, Aaron brings his deep expertise in capital markets and his innovative approach to equity crowdfunding. His insights will be invaluable as GECA works to create a truly borderless ecosystem where companies can raise capital from a global audience. Aaron’s commitment to community-building aligns perfectly with GECA’s mission to foster cross-border collaboration in equity crowdfunding, making investment opportunities accessible to everyone, regardless of geographical location.
We are excited about the impact Aaron will have as we work together to shape the future of equity crowdfunding. His leadership and forward-thinking approach will be critical in driving our collective vision forward, ensuring that equity crowdfunding becomes a mainstream avenue for companies and investors alike.
Welcome, Aaron, to the GECA Steering Committee! We look forward to collaborating with you and learning from your expertise as we continue on this journey toward a global equity crowdfunding future.
For more information on DealMaker, visit the DealMaker.tech website.
