Market Insights Financial Capital Raising Digital Capital Raising

Reward-Based Crowdfunding - Germany

Germany

Germany's Reward-Based Crowdfunding market is projected to reach a total transaction value of €64.45m in 2024.
When compared globally, the United States leads with a transaction value of €431m in the same year.
Germany's Crowdfunding market for Capital Raising is experiencing a surge in interest, with tech startups leading the way in innovative fundraising campaigns.

Key regions: Germany, Brazil, Australia, Israel, United States

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Analyst Opinion

The Crowdfunding market in Germany is experiencing significant growth and development.

Customer preferences: German investors are increasingly turning to crowdfunding as a means of diversifying their investment portfolios and supporting innovative projects. Crowdfunding platforms offer a wide range of investment opportunities, allowing investors to choose projects that align with their interests and values. Additionally, crowdfunding provides a way for individuals to support small businesses and startups, which may struggle to secure traditional financing. This customer preference for supporting local businesses and innovative projects has contributed to the growth of the crowdfunding market in Germany.

Trends in the market: One major trend in the German crowdfunding market is the rise of equity-based crowdfunding. This type of crowdfunding allows individuals to invest in startups and small businesses in exchange for equity or shares in the company. Equity-based crowdfunding provides investors with the potential for financial returns if the company is successful. This trend reflects a shift in investor preferences towards more long-term and potentially lucrative investment opportunities. Another trend in the German crowdfunding market is the increasing popularity of real estate crowdfunding. Real estate crowdfunding platforms enable individuals to invest in property development projects, such as residential or commercial buildings. This type of crowdfunding allows investors to access the real estate market with lower capital requirements and diversify their investments across multiple properties. The growth of real estate crowdfunding in Germany can be attributed to the country's stable and lucrative real estate market.

Local special circumstances: Germany has a strong culture of innovation and entrepreneurship, which has contributed to the growth of the crowdfunding market. The country is home to a large number of startups and small businesses that are in need of funding to bring their ideas to life. Crowdfunding provides a viable alternative to traditional financing options, allowing these businesses to access capital and grow. Furthermore, Germany has a highly educated population with a high level of financial literacy. This makes German investors more open to alternative investment opportunities such as crowdfunding. The country also has a robust regulatory framework for crowdfunding, which provides investors with a certain level of protection and ensures transparency in the market.

Underlying macroeconomic factors: The growth of the crowdfunding market in Germany can also be attributed to macroeconomic factors. Germany has a strong and stable economy, which has resulted in a high level of disposable income among its population. This provides individuals with the financial means to invest in crowdfunding projects. Additionally, low interest rates in Germany have made traditional savings and investment options less attractive. Crowdfunding offers the potential for higher returns compared to traditional savings accounts or government bonds. This has led to an increasing number of individuals turning to crowdfunding as a way to grow their wealth. In conclusion, the crowdfunding market in Germany is experiencing significant growth and development due to customer preferences for supporting local businesses and innovative projects. Equity-based crowdfunding and real estate crowdfunding are two major trends in the market. Germany's culture of innovation, financial literacy, and strong economy, along with low interest rates, are underlying macroeconomic factors driving the growth of the crowdfunding market.

Methodology

Data coverage:

The data encompasses B2C enterprises. Figures are based on transaction values / revenues / assets under management and user data of relevant services and products offered within the FinTech market.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending, population, internet penetration, smartphone penetration, credit card penetration, and online banking penetration. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.