Market Insights Financial Capital Raising Digital Capital Raising

Reward-Based Crowdfunding - Southern Europe

Southern Europe

The Reward-Based Crowdfunding market in Southern Europe is expected to see a total transaction value of €32.90m in 2024.
When compared globally, the United States leads with a projected transaction value of €426m in the same year.
In Southern Europe, Spain is witnessing a surge in real estate crowdfunding as investors seek alternative opportunities in the capital raising market.

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

Mercado

Región

Comparación de regiones

Moneda

Analyst Opinion

The Crowdfunding market in Southern Europe has been steadily growing in recent years, driven by changing customer preferences, emerging trends, and local special circumstances. Customer preferences in Southern Europe have shifted towards alternative financing options like Crowdfunding due to the increased difficulty in obtaining traditional bank loans.

This is particularly true for small and medium-sized enterprises (SMEs) that may not meet the strict lending criteria of banks. Crowdfunding provides these businesses with an opportunity to raise funds directly from the public, bypassing the traditional banking system. Additionally, individuals in Southern Europe are increasingly interested in supporting local projects and initiatives, and Crowdfunding platforms offer a convenient way to contribute to these causes.

One of the key trends in the Crowdfunding market in Southern Europe is the rise of reward-based Crowdfunding. This type of Crowdfunding allows individuals to contribute funds to a project or business in exchange for non-financial rewards such as products, services, or experiences. This trend has gained popularity due to its appeal to both project creators and backers.

For project creators, reward-based Crowdfunding offers a way to validate their ideas and generate pre-sales before launching a product or service. For backers, it provides an opportunity to be part of the creative process and receive unique rewards that may not be available elsewhere. Another trend in the Crowdfunding market in Southern Europe is the increasing use of equity-based Crowdfunding.

This type of Crowdfunding allows individuals to invest in a business in exchange for equity or ownership shares. Equity-based Crowdfunding has gained traction as a way for entrepreneurs to raise capital for their ventures while also providing investors with the potential for financial returns. This trend has been supported by regulatory changes in some Southern European countries, which have made it easier for businesses to raise funds through equity-based Crowdfunding platforms.

Local special circumstances also play a role in the development of the Crowdfunding market in Southern Europe. For example, countries like Spain and Italy have a strong entrepreneurial culture, with many individuals aspiring to start their own businesses. Crowdfunding provides a viable option for these entrepreneurs to raise funds and turn their ideas into reality.

Additionally, Southern Europe has a rich cultural heritage and a vibrant arts and creative sector. Crowdfunding platforms have emerged as a way for artists, musicians, and other creative professionals to finance their projects and reach a wider audience. Underlying macroeconomic factors have also contributed to the growth of the Crowdfunding market in Southern Europe.

The region has experienced economic challenges in recent years, including high unemployment rates and limited access to traditional financing. Crowdfunding has emerged as a solution to these challenges, providing individuals and businesses with an alternative source of funding. Additionally, advancements in technology and the widespread use of the internet have made it easier for Crowdfunding platforms to connect project creators with potential backers, further fueling the growth of the market.

In conclusion, the Crowdfunding market in Southern Europe is developing due to changing customer preferences, emerging trends such as reward-based and equity-based Crowdfunding, local special circumstances such as a strong entrepreneurial culture and a vibrant arts sector, and underlying macroeconomic factors including economic challenges and technological advancements. This market is expected to continue growing as more individuals and businesses embrace Crowdfunding as a viable financing option.

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.