What is crowdfunding?
Crowdfunding is an Internet phenomenon where projects are funded by the group of individuals, primarily online via social media and crowdfunding platforms. Money can be raised for business ideas, social causes or cultural projects.
4 types of crowdfunding in Switzerland
The type of funding where participants/funders support start-up business. In return, they get the share in the company or the share in the profit of the company. The first crowdinvesting platform in Switzerland was Investiere in 2010.
The type of funding also known as peer-to-peer lending. Funders lend money to the borrower for business or any other purpose. As a result, lenders earn higher returns compared to savings, while borrowers can borrow money at lower interest rates. The first crowdlending platform in Switzerland was Cashare; the year was 2008.
The type of funding where donors support cultural, creative, sports or commercial projects receiving a reward in the form of product, work of art, invitation etc. Two biggest reward-based crowdfunding platforms in Switzerland are 100-days and wemakeit.
This is a genuine form of donating where funders have no interest and no reward. Usually, it is oriented towards social, charitable and cultural projects. The first crowddonating platform GivenGain was launched in 2009.
Crowdfunding in Switzerland via numbers
– In 2015, CHF 27.3 million (+73%) was raised for 1,342 campaigns in Switzerland. The industry posted year-on-year growth of 73 percent.
– CHF 65 million was raised within six years through crowdfunding in Switzerland.
– More than 90,000 people backed crowdfunding projects in Switzerland in 2015.
– Around 40 crowdfunding platforms were operating in Switzerland as of the end of April 2016.
– 1,059 crowdsupporting and crowddonating campaigns were funded in 2015 out of a total of 1,639 launched with a success rate of 64.6 percent.
– In Switzerland, reward-based crowdfunding is local phenomenon: the average distance between project initiators and backers is just 12 kilometres.
– Fees for posting a project on crowdfunding platform in Switzerland go from 0 to 10%.