Equity crowdfunding

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Crowdinvesting is a form of financing in which numerous people (micro-investors, investors, investors ) with typically rather small amounts of moneyparticipate in mostly young companies ( start-ups )via the Internet , in most cases via silent participations , profit participation rights or profit-sharing loans . The incentive for the micro-investor isto hopefor high returns . However, the risk with crowd investing is also high. As with any equity investmentthe micro-investor can lose his stake if the company is unsuccessful. So far there is no comprehensive legal basis in Germany. Therefore, this type of financing is as part of the gray market refers

According to the statutory regulation, the silent partnership is basically a debt capital requirement and not a participation in equity . A participation in the equity exists, however, if the silent partner on the basis of the articles of association is supposed to bear the same risk of loss and insolvency as a limited partner.

Profit participation rights or participatory loans are also known as mezzanine capital ; it is a credit relationship that is linked to a profit-sharing scheme. The micro-investor's influence on the company is regulated in a contract between the micro-investor and the company.

Equity crowdfunding was prepared analogously to crowd sourcing , the voluntary provision of services by a group, and crowd funding , the funding of a joint project, are formed, and is a compound word of the words "crowd" (English for amount of accumulation) and "investing" (English for investing ) .

The equity crowdfunding process is carried out either via a portal of a specialized provider or independently via the company's own website . Crowdinvesting offers have existed since 2009. The amounts of funding previously raised via crowdinvesting are now showing high growth rates.

Concept and functionality

Crowdinvesting is a special form of crowdfunding and has the following characteristics:

  1. Investors are sought for companies via the Internet (or other mass media)
  2. The minimum investment amount is so low that numerous investors are required and everyone can participate even with small amounts,
  3. which are used to finance the companies selected by you,
  4. in the event of success, the lenders receive a share in the profits of the company they finance and
  5. the profit-sharing mostly consists in a participation of the micro-investor in the profit of the company and possibly also in its increase in value. B. in the form of a severance payment when the micro-investor leaves (after the minimum participation period has expired). The hope of a very pronounced increase in the value of the investment will usually be the main motive of the micro-investor to get involved in crowd investing.

The process of equity crowdfunding via equity crowdfunding platforms is usually this:

  1. The founders (capital seekers) provide information about their project.
  2. The information is verified by the equity crowdfunding platform.
  3. If the check is positive, the start-up project is presented on the platform's website and can be viewed there by anyone. Interested persons can now participate in the desired start-up company within a fixed period of time (funding period). However, financing only comes about if a specified minimum financing amount (funding threshold) has been reached. Otherwise, the micro-investors will get their money back.
  4. If the minimum funding amount is met, the start-up will receive the funds and can build the business. The micro-investors are now regularly provided with information about the business development of the start-up, and if the project is successful, the micro-investors receive their contribution to success.

Development of crowdinvesting

The world's first crowdinvesting platform ProFounder was able to successfully complete its first financing project in 2009. Until 2011, crowdinvesting was extremely low worldwide. In the course of 2012, both the number and volume of successfully financed projects rose significantly, but so far they have played a subordinate role in the area of venture finance . This can be shown using the German crowdinvesting market as an example: The capital raised in Germany in 2011 was approx. € 450,000. In 2012 it was already € 4.3 million, spread over 45 financings from 43 start-ups. Since 2011, € 720.9 million has been invested in real estate , € 346.8 million in companies and € 32.2 million in energy projects in Germany (as of May 2019).

criticism

An essential prerequisite for successful company investments are extensive previous reviews of the company (e.g. due diligence ) with the aim of presenting the company's earnings prospects and compliance for the investor. In the case of small investment amounts, it is not worth the effort of a thorough examination and a comprehensive presentation in connection with the prospectus liability . Therefore there are corresponding exemptions in Germany. Crowd investing in Germany has been partially regulated by the Small Investor Protection Act since July 10, 2015 .

literature

Web links

Footnotes

  1. ↑ Crowdfunding: Regulatory duties and responsibilities of the investor. Retrieved August 14, 2020 .
  2. ↑ K. Schmidt, in: Müko-HGB, 3rd edition 2012, § 230 HGB, marginal no. 170.
  3. ↑ K. Schmidt, in: Müko-HGB, 3rd edition 2012, § 230 HGB, marginal no. 171.
  4. ^ Ralf Beck: Crowdinvesting. The investment of the many. Düsseldorf 2012, p. 18.
  5. ^ Ralf Beck: Crowdinvesting. The investment of the many. Düsseldorf 2012, p. 11.
  6. ↑ Für-Gründer.de: Crowd funding and crowd investing in Germany . September 30, 2012, p. 19 (PDF; 1.684 MB)
  7. ↑ 2012: the crowd gives over € 6 million to projects and start-ups . In: Für-Gründer.de blog. January 15, 2013
  8. ↑ Market data | crowdfunding.de. October 27, 2018, accessed on August 14, 2020 (German).
  9. ↑ Crowdfunding: Regulatory duties and responsibilities of the investor. Retrieved August 14, 2020 .
  10. ^ Publisher: Small Investor Protection Act - Federal Ministry of Finance - Service. In: bundesfinanzministerium.de. November 4, 2008, accessed March 3, 2019 .