Crowdfunding

Crowdfunding Market Outlook

The global crowdfunding market was valued at approximately USD 13.9 billion in 2023 and is expected to reach USD 24.8 billion by 2035, growing at a compound annual growth rate (CAGR) of 7.9% during the forecast period. This significant growth can be attributed to the increasing acceptance of alternative financial solutions and the widespread use of digital technology, which has made it easier for startups and entrepreneurs to access funding. Moreover, the shift in consumer behavior towards supporting innovative ideas and social causes has fueled market expansion. Additionally, the COVID-19 pandemic has necessitated the need for creative funding solutions, thereby accelerating the adoption of crowdfunding platforms. The rise of social media and online communities has further empowered individuals to back projects they believe in, contributing to the market's robust growth trajectory.

Growth Factor of the Market

The growth of the crowdfunding market is primarily driven by the democratization of finance, which allows various stakeholders to participate in funding projects and ventures that resonate with their interests. As traditional funding avenues become increasingly stringent, more entrepreneurs are turning to crowdfunding as an accessible and viable alternative. Additionally, advancements in technology, particularly in payment processing and online marketing, have streamlined the user experience on crowdfunding platforms, thereby attracting more users. The growing trend of social entrepreneurship and a focus on sustainable projects have also contributed positively to market dynamics. Furthermore, the surge in the gig economy and freelance work has created a substantial demand for innovative funding solutions, as individuals seek financial backing for a diverse range of ventures. The increasing number of crowdfunding campaigns across various segments further solidifies the market's expansion, as diverse offerings appeal to a wider audience.

Key Highlights of the Market

• The crowdfunding market is anticipated to reach USD 24.8 billion by 2035.
• Reward-based crowdfunding continues to dominate the market share.
• Equity crowdfunding is gaining traction among startups seeking scalable funding.
• The technology and healthcare sectors are leading in crowdfunding initiatives.
• North America holds a significant portion of the crowdfunding market due to early adoption.

By Type

Reward-based Crowdfunding:

Reward-based crowdfunding is one of the most popular types of crowdfunding, where contributors receive non-financial rewards in exchange for their funds. This model has gained immense popularity, particularly among creative projects like films, music albums, and technology innovations. Platforms such as Kickstarter and Indiegogo have capitalized on this model, enabling creators to showcase their ideas and attract backers who are motivated by the rewards they will receive. This approach not only fosters community engagement but also allows projects to gauge market interest before full-scale production. The growth of this segment is expected to continue as more creators leverage digital platforms to reach their audiences.

Donation-based Crowdfunding:

Donation-based crowdfunding allows individuals to contribute funds to causes or projects without expecting any financial return. This model is commonly used for charitable causes, medical expenses, and community projects, providing a way for people to support others in need. Platforms like GoFundMe have become synonymous with this type of crowdfunding, highlighting its effectiveness in mobilizing community support. The rise of social media has facilitated the rapid spread of donation campaigns, as individuals share causes they believe in, further driving contributions. As societal emphasis on corporate social responsibility and philanthropy grows, this segment is likely to expand significantly.

Equity Crowdfunding:

Equity crowdfunding allows investors to purchase shares in a company, offering a financial return on their investment. This model has become increasingly attractive to startups looking for capital without the constraints of traditional funding routes. Platforms like SeedInvest and Crowdcube have made it easier for individuals to invest in promising startups, fostering a culture of entrepreneurship. This segment has witnessed remarkable growth due to its ability to democratize investment opportunities, allowing everyday investors to participate in funding innovative ideas. As regulatory frameworks evolve to support equity crowdfunding, this segment is expected to witness exponential growth in the coming years.

Debt Crowdfunding:

Debt crowdfunding, also known as peer-to-peer lending, enables individuals or companies to borrow money directly from a pool of investors, bypassing traditional financial institutions. This type of crowdfunding is appealing due to the potential for lower interest rates for borrowers and higher returns for investors. Platforms such as LendingClub and Prosper have popularized this model, providing an efficient marketplace for both lenders and borrowers. As individuals increasingly seek alternative lending solutions, the demand for debt crowdfunding is expected to rise. Moreover, the integration of technology in assessing creditworthiness enhances the user experience, contributing to the growth of this segment.

Real Estate Crowdfunding:

Real estate crowdfunding allows investors to pool their money to invest in real estate projects, providing an opportunity to access the real estate market without significant capital. This segment has gained traction as it offers diversification and the potential for attractive returns. Platforms like Fundrise and RealtyMogul have made it easier for investors to engage in real estate projects, ranging from residential developments to commercial properties. The growth of this segment is fueled by the increasing interest in alternative investment options and the desire for passive income streams. As more investors seek opportunities in real estate, this segment is poised for significant expansion.

By Platform

P2P Lending:

P2P lending platforms connect borrowers directly with individual lenders, enabling them to bypass traditional banks. This model has gained popularity due to its ability to provide quicker access to funds, often at more favorable interest rates. Lenders benefit from the opportunity to earn higher returns compared to traditional savings accounts. As awareness of P2P lending grows, more borrowers are drawn to the convenience and transparency these platforms offer. The ongoing evolution of technology, along with a growing acceptance of online financial services, is expected to drive further growth in this segment.

Equity Investment:

Equity investment platforms allow individuals to invest in startups and growing businesses in exchange for equity, providing a stake in the company's future success. This approach democratizes access to investment opportunities, enabling everyday investors to participate in high-potential ventures. Platforms such as Seedrs and StartEngine have emerged as popular choices, particularly among tech-savvy investors looking for innovative opportunities. As regulatory environments become more favorable, the equity investment segment is likely to experience robust growth, attracting a diverse range of investors.

Reward-based:

Reward-based platforms cater to creators and entrepreneurs who seek funds for their projects by offering backers non-financial rewards. This model emphasizes community engagement and allows creators to validate their ideas before full-scale production. With platforms like Kickstarter leading the charge, this segment has seen significant traction in various creative fields, including arts, technology, and social initiatives. The appeal of reward-based crowdfunding lies in its ability to foster a sense of community and support for innovative projects, prompting further growth in this area.

Donation-based:

Donation-based platforms facilitate contributions to charitable causes, medical expenses, and community projects without any expectation of returns. This segment has gained traction due to the increasing emphasis on social responsibility and philanthropy. Platforms like GoFundMe and JustGiving have demonstrated the effectiveness of mobilizing community support for individuals in need. As more campaigns gain visibility through social media, the donation-based crowdfunding segment is likely to continue its upward trajectory, fueled by a growing culture of compassion and support for social causes.

By User

Individuals:

Individuals represent a significant segment of the crowdfunding market, as many people utilize platforms to raise funds for personal projects, medical expenses, or creative endeavors. The accessibility of crowdfunding platforms empowers individuals to tap into their networks and beyond to gather support. As societal norms shift and the stigma around seeking financial help decreases, more individuals are likely to explore crowdfunding as a viable option. The rise of social media has also expanded the reach of individual campaigns, allowing for rapid dissemination of project information to a larger audience.

Startups:

Startups are one of the primary beneficiaries of the crowdfunding model, as they can access capital without the traditional limitations imposed by banks and venture capital. This segment has seen significant growth as entrepreneurs seek innovative ways to finance their ideas while maintaining creative control. Platforms like Kickstarter and Indiegogo have become essential tools for startups, enabling them to validate their projects and build a community of supporters. As the entrepreneurial ecosystem continues to evolve, crowdfunding is expected to play an increasingly crucial role in supporting new ventures and fostering innovation.

Small and Medium Enterprises:

Small and medium enterprises (SMEs) are increasingly turning to crowdfunding as a means of accessing funding for growth and expansion. These businesses often face challenges securing traditional bank loans, making crowdfunding an attractive alternative. By leveraging crowdfunding platforms, SMEs can raise capital while simultaneously building a loyal customer base. This segment is expected to grow as more SMEs recognize the benefits of crowdfunding, including the opportunity to engage with customers directly and receive feedback on products or services before full-scale launch.

Large Enterprises:

Large enterprises are also exploring crowdfunding as a strategic avenue for launching new products or initiatives. By utilizing crowdfunding campaigns, these companies can gauge consumer interest and validate their ideas before committing significant resources. This approach not only minimizes financial risk but also fosters a sense of community and brand loyalty among consumers. As large enterprises increasingly embrace innovative funding models, the crowdfunding market is likely to witness diversification in the types of projects being funded.

Non-Profit Organizations:

Non-profit organizations are significant participants in the crowdfunding space, as they utilize platforms to raise funds for charitable causes and community projects. This type of crowdfunding mobilizes community support and fosters a sense of collective purpose. Non-profits often leverage their existing networks and social media platforms to promote campaigns, amplifying their reach and impact. As public awareness of social issues grows, non-profit organizations are expected to continue embracing crowdfunding as an effective means of securing funding for their initiatives.

By Industry

Technology:

The technology sector is one of the most prominent industries in the crowdfunding landscape, as innovative startups often rely on crowdfunding to bring their ideas to life. Platforms like Kickstarter and Indiegogo have successfully funded numerous tech projects, from consumer electronics to software applications. This industry has benefitted from the growing interest in disruptive technologies and the desire for early access to the latest innovations. As technology continues to evolve, the crowdfunding market will likely witness an influx of projects looking to harness the collective support of backers.

Healthcare:

The healthcare industry has increasingly turned to crowdfunding to support medical research, personal medical expenses, and health-related initiatives. Platforms like GoFundMe have facilitated numerous campaigns aimed at fundraising for medical treatments or research projects. As healthcare costs continue to rise, more individuals and organizations are seeking alternative funding methods, making this segment a significant part of the crowdfunding market. The increasing emphasis on patient-centric care and community support further highlights the critical role of crowdfunding in advancing healthcare initiatives.

Real Estate:

Real estate crowdfunding has emerged as a viable investment opportunity, allowing individuals to pool funds to invest in real estate projects. This segment has gained traction as it democratizes access to the real estate market, enabling investors to participate in projects without significant capital. Platforms like Fundrise have popularized this model, attracting a diverse range of investors. The potential for attractive returns and diversification makes real estate crowdfunding an appealing option for those looking to invest in tangible assets. As interest in alternative investment opportunities grows, this segment is expected to experience robust growth.

Creative Projects:

Creative projects encompass a wide range of initiatives, from films and music albums to art installations and literary works. Crowdfunding has become an essential funding avenue for artists and creators, allowing them to secure financial backing from supporters who believe in their vision. Platforms like Kickstarter have showcased the power of community support in the creative industry, fueling a resurgence of independent projects. As creative expression continues to be valued in society, the crowdfunding market for creative projects is likely to thrive.

Education:

The education sector has increasingly embraced crowdfunding as a means to fund innovative programs, scholarships, and educational materials. Educators and institutions often turn to crowdfunding platforms to bridge funding gaps and support initiatives that enhance learning experiences. Platforms such as DonorsChoose allow teachers to post specific projects and receive funding directly from supporters. As educational funding challenges persist, the crowdfunding market in this sector is expected to grow, empowering educators to innovate and provide quality education.

By Region

North America remains the largest market for crowdfunding, accounting for nearly 40% of the global revenue in 2023. This dominance is primarily driven by the early adoption of crowdfunding models and a supportive regulatory environment. The U.S. has established itself as a leader in the crowdfunding landscape, with numerous platforms operating within its borders. The CAGR for the North American crowdfunding market is projected to be around 8.5% from 2025 to 2035, fueled by the continuous innovation in funding models and a growing number of successful campaigns. The presence of a robust startup ecosystem and a culture that encourages entrepreneurship further reinforces the region's leading position in the market.

Europe has also witnessed significant growth in the crowdfunding market, accounting for approximately 30% of the global share in 2023. The region's diverse funding needs have led to the emergence of various crowdfunding platforms tailored to specific industries and user segments. Countries like the UK, Germany, and France are at the forefront of this trend, with increasing numbers of startups turning to crowdfunding for financing. The European crowdfunding market is expected to grow at a CAGR of 7.0% over the forecast period, driven by the rise of social entrepreneurship and the demand for innovative funding solutions. As regulations continue to adapt to the evolving landscape, the European market is poised for further expansion.

Opportunities

The crowdfunding market presents numerous opportunities for growth and innovation, particularly as technology continues to evolve. One significant opportunity lies in the integration of blockchain technology, which can enhance transparency and security within crowdfunding transactions. By utilizing smart contracts, crowdfunding platforms can ensure that funds are distributed securely and that project milestones are met before disbursement. This technology can build trust among backers and attract more investors to participate in crowdfunding campaigns. Moreover, the rise of niche crowdfunding platforms tailored to specific industries, such as green technology or social enterprises, further highlights the opportunities for targeted market growth, as investors increasingly seek to support projects that align with their values.

Additionally, there is a growing opportunity to expand crowdfunding into emerging markets where access to traditional funding sources is limited. As financial technologies continue to advance, crowdfunding can provide an alternative financing solution for entrepreneurs and startups in developing regions. This expansion can empower individuals to pursue their ideas and contribute to local economies. Furthermore, partnerships between crowdfunding platforms and established financial institutions can facilitate the growth of the market by providing additional resources and expertise. As the crowdfunding landscape continues to develop, these opportunities are likely to shape the future of the industry.

Threats

The crowdfunding market faces several threats that could impact its growth and sustainability. One major threat is the potential for regulatory challenges, as governments worldwide scrutinize crowdfunding practices to protect investors and ensure compliance. As regulatory frameworks evolve, platforms may face increased operational costs and complexities in adhering to new requirements, which could hinder innovation and slow market growth. Additionally, the emergence of fraudulent campaigns poses a risk to the integrity of crowdfunding, as backers may become skeptical and hesitant to invest if they perceive a lack of accountability. This could lead to a decline in contributions and project funding, ultimately impacting the overall market.

Furthermore, the intense competition among crowdfunding platforms can create pressure on fees and service quality. As platforms strive to attract users, there may be a race to lower fees, which could compromise the sustainability of businesses. This competitive landscape can lead to a focus on quantity over quality, resulting in a saturation of campaigns that may not meet the expectations of backers. Consequently, the overall user experience could diminish, negatively affecting the reputation of crowdfunding as a viable funding option. Addressing these threats will be crucial for platforms looking to maintain credibility and foster a supportive environment for creators and investors alike.

Competitor Outlook

• Kickstarter
• Indiegogo
• GoFundMe
• SeedInvest
• Crowdcube
• LendingClub
• Fundrise
• DonorsChoose
• Patreon
• WeFunder
• RealtyMogul
• StartEngine
• CircleUp
• Prospa
• Upstart

The competitive landscape of the crowdfunding market is diverse, featuring a range of platforms catering to specific types of crowdfunding. Prominent players such as Kickstarter and Indiegogo have established themselves as leaders in the reward-based crowdfunding space, offering creators a platform to launch their projects and engage with a broad audience. These platforms have successfully raised millions of dollars for various creative initiatives, fostering a strong community of backers and creators. With a user-friendly interface and strong marketing strategies, these platforms continue to attract both new and returning users, solidifying their positions in the market.

In addition to reward-based platforms, equity crowdfunding has gained significant traction, with platforms like SeedInvest and Crowdcube leading the way. These platforms enable investors to purchase shares in startups, providing them with an opportunity to support innovative businesses while potentially earning a financial return. The successful launch of numerous equity crowdfunding campaigns has showcased the demand for alternative investment opportunities, further driving competition in this segment. As regulatory environments continue to evolve, these platforms are well-positioned to capitalize on the growing interest in equity crowdfunding, attracting a diverse range of investors.

Moreover, donation-based platforms like GoFundMe have gained widespread recognition for their role in enabling individuals to raise funds for personal and charitable causes. The platform’s success has largely been driven by its user-friendly interface and the ability to tap into social networks for support. As awareness of social issues and community needs continues to rise, donation-based crowdfunding is expected to experience continued growth, further intensifying competition in this segment. Overall, the crowdfunding landscape is characterized by diverse platforms that cater to various needs and preferences, creating a dynamic environment for competition and innovation.

• 1 Appendix

  • 1.1 List of Tables
  • 1.2 List of Figures

• 2 Introduction

  • 2.1 Market Definition
  • 2.2 Scope of the Report
  • 2.3 Study Assumptions
  • 2.4 Base Currency & Forecast Periods

• 3 Market Dynamics

  • 3.1 Market Growth Factors
  • 3.2 Economic & Global Events
  • 3.3 Innovation Trends
  • 3.4 Supply Chain Analysis

• 4 Consumer Behavior

  • 4.1 Market Trends
  • 4.2 Pricing Analysis
  • 4.3 Buyer Insights

• 5 Key Player Profiles

  • 5.1 Prospa
    • 5.1.1 Business Overview
    • 5.1.2 Products & Services
    • 5.1.3 Financials
    • 5.1.4 Recent Developments
    • 5.1.5 SWOT Analysis
  • 5.2 Patreon
    • 5.2.1 Business Overview
    • 5.2.2 Products & Services
    • 5.2.3 Financials
    • 5.2.4 Recent Developments
    • 5.2.5 SWOT Analysis
  • 5.3 Upstart
    • 5.3.1 Business Overview
    • 5.3.2 Products & Services
    • 5.3.3 Financials
    • 5.3.4 Recent Developments
    • 5.3.5 SWOT Analysis
  • 5.4 CircleUp
    • 5.4.1 Business Overview
    • 5.4.2 Products & Services
    • 5.4.3 Financials
    • 5.4.4 Recent Developments
    • 5.4.5 SWOT Analysis
  • 5.5 Fundrise
    • 5.5.1 Business Overview
    • 5.5.2 Products & Services
    • 5.5.3 Financials
    • 5.5.4 Recent Developments
    • 5.5.5 SWOT Analysis
  • 5.6 GoFundMe
    • 5.6.1 Business Overview
    • 5.6.2 Products & Services
    • 5.6.3 Financials
    • 5.6.4 Recent Developments
    • 5.6.5 SWOT Analysis
  • 5.7 WeFunder
    • 5.7.1 Business Overview
    • 5.7.2 Products & Services
    • 5.7.3 Financials
    • 5.7.4 Recent Developments
    • 5.7.5 SWOT Analysis
  • 5.8 Crowdcube
    • 5.8.1 Business Overview
    • 5.8.2 Products & Services
    • 5.8.3 Financials
    • 5.8.4 Recent Developments
    • 5.8.5 SWOT Analysis
  • 5.9 Indiegogo
    • 5.9.1 Business Overview
    • 5.9.2 Products & Services
    • 5.9.3 Financials
    • 5.9.4 Recent Developments
    • 5.9.5 SWOT Analysis
  • 5.10 SeedInvest
    • 5.10.1 Business Overview
    • 5.10.2 Products & Services
    • 5.10.3 Financials
    • 5.10.4 Recent Developments
    • 5.10.5 SWOT Analysis
  • 5.11 Kickstarter
    • 5.11.1 Business Overview
    • 5.11.2 Products & Services
    • 5.11.3 Financials
    • 5.11.4 Recent Developments
    • 5.11.5 SWOT Analysis
  • 5.12 LendingClub
    • 5.12.1 Business Overview
    • 5.12.2 Products & Services
    • 5.12.3 Financials
    • 5.12.4 Recent Developments
    • 5.12.5 SWOT Analysis
  • 5.13 RealtyMogul
    • 5.13.1 Business Overview
    • 5.13.2 Products & Services
    • 5.13.3 Financials
    • 5.13.4 Recent Developments
    • 5.13.5 SWOT Analysis
  • 5.14 StartEngine
    • 5.14.1 Business Overview
    • 5.14.2 Products & Services
    • 5.14.3 Financials
    • 5.14.4 Recent Developments
    • 5.14.5 SWOT Analysis
  • 5.15 DonorsChoose
    • 5.15.1 Business Overview
    • 5.15.2 Products & Services
    • 5.15.3 Financials
    • 5.15.4 Recent Developments
    • 5.15.5 SWOT Analysis

• 6 Market Segmentation

  • 6.1 Crowdfunding Market, By Type
    • 6.1.1 Reward-based Crowdfunding
    • 6.1.2 Donation-based Crowdfunding
    • 6.1.3 Equity Crowdfunding
    • 6.1.4 Debt Crowdfunding
    • 6.1.5 Real Estate Crowdfunding
  • 6.2 Crowdfunding Market, By User
    • 6.2.1 Individuals
    • 6.2.2 Startups
    • 6.2.3 Small and Medium Enterprises
    • 6.2.4 Large Enterprises
    • 6.2.5 Non-Profit Organizations
  • 6.3 Crowdfunding Market, By Industry
    • 6.3.1 Technology
    • 6.3.2 Healthcare
    • 6.3.3 Real Estate
    • 6.3.4 Creative Projects
    • 6.3.5 Education

• 7 Competitive Analysis

  • 7.1 Key Player Comparison
  • 7.2 Market Share Analysis
  • 7.3 Investment Trends
  • 7.4 SWOT Analysis

• 8 Research Methodology

  • 8.1 Analysis Design
  • 8.2 Research Phases
  • 8.3 Study Timeline

• 9 Future Market Outlook

  • 9.1 Growth Forecast
  • 9.2 Market Evolution

• 10 Geographical Overview

  • 10.1 Europe - Market Analysis
    • 10.1.1 By Country
      • 10.1.1.1 UK
      • 10.1.1.2 France
      • 10.1.1.3 Germany
      • 10.1.1.4 Spain
      • 10.1.1.5 Italy
  • 10.2 Crowdfunding Market by Region
  • 10.3 Asia Pacific - Market Analysis
    • 10.3.1 By Country
      • 10.3.1.1 India
      • 10.3.1.2 China
      • 10.3.1.3 Japan
      • 10.3.1.4 South Korea
  • 10.4 Latin America - Market Analysis
    • 10.4.1 By Country
      • 10.4.1.1 Brazil
      • 10.4.1.2 Argentina
      • 10.4.1.3 Mexico
  • 10.5 North America - Market Analysis
    • 10.5.1 By Country
      • 10.5.1.1 USA
      • 10.5.1.2 Canada
  • 10.6 Middle East & Africa - Market Analysis
    • 10.6.1 By Country
      • 10.6.1.1 Middle East
      • 10.6.1.2 Africa

• 11 Global Economic Factors

  • 11.1 Inflation Impact
  • 11.2 Trade Policies

• 12 Technology & Innovation

  • 12.1 Emerging Technologies
  • 12.2 AI & Digital Trends
  • 12.3 Patent Research

• 13 Investment & Market Growth

  • 13.1 Funding Trends
  • 13.2 Future Market Projections

• 14 Market Overview & Key Insights

  • 14.1 Executive Summary
  • 14.2 Key Trends
  • 14.3 Market Challenges
  • 14.4 Regulatory Landscape

Segments Analyzed in the Report

The global Crowdfunding market is categorized based on

By Type

• Reward-based Crowdfunding
• Donation-based Crowdfunding
• Equity Crowdfunding
• Debt Crowdfunding
• Real Estate Crowdfunding

By User

• Individuals
• Startups
• Small and Medium Enterprises
• Large Enterprises
• Non-Profit Organizations

By Industry

• Technology
• Healthcare
• Real Estate
• Creative Projects
• Education

By Region

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East & Africa

Key Players

• Kickstarter
• Indiegogo
• GoFundMe
• SeedInvest
• Crowdcube
• LendingClub
• Fundrise
• DonorsChoose
• Patreon
• WeFunder
• RealtyMogul
• StartEngine
• CircleUp
• Prospa
• Upstart