REPORT: Crowdfunding’s Potential for the Developing World

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A new report commissioned by infoDev studies the promise and the risks of crowdfunding as a tool to finance innovation and growth in developing countries. It also provides an in-depth case study of crowdfunding’s potential in funding clean energy and climate technologies.

Crowdfunding—the practice of raising funds from multiple individuals via the web—first emerged in an organized form in the low-investment environment of 2008, and has quickly grown into a multi-billion dollar industry projected to reach $5 billion this year, channeling funding to hundreds of thousands of ventures globally.

Crowdfunding combines the traditional practice of raising funds from friends, family and community for projects or business launches, with the power of the Internet, mobile technology, and social networks to drive donations and investment. It essentially democratizes financing, putting the decision to fund new ventures in the hands of the communities and customers who would benefit the most.

The revolutionary power of crowdfunding also extends to the realm of international development, the report suggests. Preliminary modeling estimates that the possible market potential for crowdfunding in developing countries could reach up to $96 billion a year over the next 25 years given the right answers to current regulatory, infrastructure and cultural challenges.

In a foreword to the report, AOL co-founder Steve Case highlights crowdfunding’s potential in enabling the “Rise of the Rest,” and calls for further study of appropriate regulation and investor protections.

Organizations such as the World Bank, governments, venture funds, and NGOs are watching crowdfunding closely to see whether it has the potential to solve the “last mile funding problem” faced by many start-up companies.

To assist them in making the most of crowdfunding, the report provides practical guidance via a self-assessment tool, a set of policy recommendations, and suggestions for the World Bank and infoDev to pursue the topic further.

The report also includes a special case study section on climate and clean energy technology addressing the applicability and opportunity of crowdfunding to infoDev’s Climate Innovation Centers.

Crowdfunding’s Potential for the Developing World

HEADLINE NEWS

Proof of use: A new crowdfunding threshold for passionate users  TechCrunchRight now, most participants in U.S. private placements must be “accredited” investors, meaning $200,000 annual income over multiple years or $1 million in net ... [...]

Why crowdfunding is here to stay  Independent OnlineWe explore the opportunities, challenges, successes and occasional failures of the phenomenon called crowdfunding. [...]

Be cautious with crowdfunding  The Week MagazineHere are three of the week's top pieces of financial advice, gathered from around the web: Be cautious with crowdfunding. It's wise to be careful when donating ... [...]

Ask SCORE: A crash course in crowdfunding | Business  The Union LeaderQuestion: I have been trying for the last six months, without success, to acquire funding to complete development and marketing of my idea for a new roofing ... [...]

Soup kitchen founder's crowdfunding making a difference | Cape Times  Independent OnlineCape Town – Soup kitchen founder Danny Diliberto has exceeded his goal to raise R48 000 for Ladles of Love, his non-profit soup kitchen that serves meals to ... [...]

Mulberry Fire Department Turns To Crowdfunding For New Fire Engine  KFSM 5NewsonlineMulberry (KFSM) - On November 6th, 2018, the volunteer fire department that services mulberry and protection district two lost their rural pumper engine. Now, to ... [...]

Crowdfunding crisis: $2,060 for a dog, but $0 for many domestic-violence victims  Chicago Sun-TimesPeople in online fundraisers seem more willing to give when a person has been killed in a domestic-violence incident than when they've been injured. [...]

Do liberals love crowdfunding? ‘Time’s Up’ and ‘March for Our Lives’ make GoFundMe’s Top 5 for 2018  MarketWatchMany people using the popular crowdfunding platform during the year were donating for the first time. [...]

OrCam launches crowdfunding campaign for unique wearable AI device  The Jerusalem Post - Israel NewsOrCam Technologies, a Jerusalem-based start-up known for developing advanced technology to help the visually impaired, launched a Kickstarter campaign. [...]

Vampire romantic comedy seeks crowdfunding  NewsbookA new production of the feel-good comedy The Acrobat by Agnes Moon is soon to be staged by Unifaun Theatre Productions, with the help of a ... [...]

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