The future of

crowdfunding in

Europe for CCIs:

from project to

equity

crowdfunding?

17:00h 18:00h

The future of crowdfunding in Europe for CCIs: from

project to equity crowdfunding?

Crowdfunding arrived some years ago and at this point is strongly established as an

alternative available source of finance for entrepreneurs and companies. From a

European point of view, we wonder how is this tool evolving and which are the new

trends. Moreover than financing contents, is crowdfunding useful for financing

companies? Are the new platforms a good tool for investors? What are the

advantatges? We take a look at some of the most interesting initiatives that are

recently taking place around Europe in this field.

Moderator: Ramon Saltor, CEO, The Crowd Angel

� Marija Popovic, Head of European Project Department, European Design Center -

10’

� Liam Collins, Policy Advisor, NESTA - 5’

Liam Collins is a Policy Advisor working on Innovation and Economic Growth at UK

Innovation Foundation Nesta. His work focuses on access to finance for young and

growing businesses most recently examining the potential for crowdfunding and peer-

to-peer lending. His reports include The Venture Crowd, which examined the potential

and challenges for equity crowdfunding, Crowding In which articulated the breadth of

areas crowdfunding is having an impact and Banking on Each Other which is the first

piece of research examining the potential of peer-to-peer lending to small and

medium-sized enterprises.

� Benoit Vandevivere, ECN Member & Policy Advisor and CEO of Secured Assets and

AAA Group - 5’

Entrepreneur involved for over 15 years in the Internet, IT and Telecom industry, he

has hold senior executive at startups as well as larger multi billion Euros companies. He

is also Advisor on Policymaking at the European Crowdfunding Network, Europe's

largest Crowdfunding organization. He is CEO and co-founder of AAA Group and

Secured Assets. Secured Assets is an asset-based financial vehicle for Crowdlending.

He lived and worked in Asia, United States and Europe and has signed business deals

all over the World, from Africa to Asia, from Europe to America (North and South) with

Fortune 500 companies.

He has been involved in the internet wave back in 1995 working with the founding

team of AOL Europe (now part of AOL time Warner). -

He holds Master degrees in Business Administration, in Computer Science from Paris

Dauphine, Post-grade studies in corporate governance, High Tech Management, Sales

Management and Marketing from Harvard University

Master and Post-degree titles in International Business Law (Such as insolvency

administrator and Expert Witness in IT).

He speaks Spanish, English, French and understands Catalan, Italian.

Benoit is a frequent speaker at government-backed initiatives including European

Union, Austria, USA, Singapore, France around entrepreneurship policymaking.

Recently he spoke to the NYSE Euronext HQs in Paris on SMB financing, Federal

Chamber of Commerce of Austria, European Commission HQs in Brussels regarding the

Crowdfunding and its policymaking.

� Carlos Silva, President & Chief Operating Officer, Seedrs - 5’

� Ramon Saltor, CEO, The Crowd Angel - 5’

Moderator: Ramon Saltor, CEO, The Crowd Angel

The future of crowdfunding in Europe for CCIs:

From project to equity crowdfunding

Barcelona, June 5th, 2013

Ramon Saltor, rsaltor@thecrowdangel.com

1997 – MARILLION, $60,000

2001 – ARTITSHARE, 1ª plataforma para música

2009 – BARACK OBAMA, $137M

2011 – EL COSMONAUTA, €300.000

2012 – KICKSTARTER - 17 projects, $1M+ - $319M in total funding - FEB: Elevation Dock 1st campaign $1M - MAR: Pebble Technology 1st campaign

$1M+ ($3M) - MAY: 1st campaign $10M

Crowdfunding milestones

2012 – JOBS ACT

Market growth and composition

Fuente: Crowdfunding Industry Report 2012, crowdsourcing.org

2012 2013 (Forecast)

Fuente: Crowdfunding Industry Report 2012, crowdsourcing.org

Equity

Crowdfunding cathegories

Lending Reward Donation Mixed others

Market growth and composition

Fuente: Crowdfunding Industry Report 2012, crowdsourcing.org

Market growth and composition

Marija Popovic, Head of European Project Department, European Design Center

How to Grow Tools for Creative Industries

www.howtogrow.eu

Where did we come from?

How to Grow was developed under the

Bcreative project, a Europe INNOVA

initiative.

It was designed as an online toolbox and

meeting place for creative professionals.

The platform included three main areas:

Gaining knowledge

Including a Mediabase and a Watch and Interact area

Building networks

Including a partner search tool, a forum and personalized

profiles

Getting finance

Including information about available grants and funds,

crowdfunding platforms and other sources of finance.

How did it evolve?

With much experimentation and user feedback, How to Grow evolved into

a more dynamic and interactive platform with a particular focus on access

to finance content.

We started organizing regular live events on topics like pitching,

investment in Creative Industries and success stories from creative

entrepreneurs.

We also recruited many sectoral partners to support us with knowledge

and access to creative businesses. Some partners include the Frankfurt

Book Fair, London Fashion Angels, ECCE, CKO, among others.

How to Grow became a centralized touch point for creative professionals

looking to start or grow their businesses.

We also invested in preparing the

platform to better support those

looking for finance.

Supported by a new project (CI-Factor) under th European Creative

Industries Alliance, How to Grow is now focused on better linking

traditional and new financiers with creative businesses.

New developments to be launched

soon

An aggregator for Crowd funding in Europe

A meeting place for investors and creative pitchers

A source of practical knowledge on access to finance for CI

How can you participate?

For creative companies: Find relevant knowledge, connections and meet

investors for your business.

For investors: Get connected with promissing businesses, carefully

prepared by How to Grow and its partners. Find other investors and

embarc on joint ventures.

For incubators/ accelerators: Put your start-ups and entrepreneurs in

contact with international investors.

For crowdfunding platforms: Join the community and increase your

platform’s visibility.

For all: Collaborate with How to Grow on our current areas or join us on

continuously improve and develop the platform.

Want to know more or collaborate?

Don’t be shy

marija@edc.nl

www.howtogrow.eu

Liam Collins, Policy Advisor, NESTA

Crowdfunding for creative businesses

liam.collins@nesta.org.uk @liam_p_collins

$2.7bn in 2012, predicted to almost double in 2013

Source: Massolution

Distinction between different models important

UK Crowdfunding Directory

www.crowdingin.com

Rewards Crowdfunding

Benefits:

• Easy to access opportunity to raise finance • Can test market demand • Cheap to fail • Can use feedback during funding process to

iterate on idea • Don’t have to give away equity • Don’t have to pay back loan • Can be good marketing tool

Rewards Crowdfunding

Rewards Crowdfunding

Rewards Crowdfunding

Potential drawbacks

• Requires a lot of effort • Failure rates can be high • Fees (although usually only if successful) • Cost of delivering rewards • Difficult to source large contributions • Not all businesses are setup to do rewards

Equity Crowdfunding

Equity Crowdfunding

Benefits

• Allow investors to benefit in success of venture • Potential for businesses to source larger

investments • Can source non-financial assistance from

backers • Decreases the cost for investors of building a

diversified portfolio of equity investments • Generous tax breaks in some regions

Equity Crowdfunding

Potential drawbacks

• Businesses have to give away equity • Potential for investors to loose all of their money

(especially inexperienced investors) • Possibility of regulatory restrictions • Managing large numbers of shareholders (with

some types of equity crowdfunding) • Fees (usually dependent on success)

Equity Crowdfunding

Challenges for crowdfunding going forward?

• Will dominant players be geographically concentrated?

• Equipping people with the skills to engage the crowd for funding

• Ensuring the model does not have an adverse effect on equality

• Interacting with traditional forms of funding • Ensuring regulation is proportional to risk

Benoit Vandevivere, ECN Member & Policy Advisor and CEO of Secured Assets and AAA Group

5th June 2013 Barcelona

www.europecrowdfunding.org Benoit Vandevivere

About us

• Initiated in November 2011 • Set up as an International Not-for-Profit (AISBL) • Privately funded • 1000+ supporters and members across Europe • Advises EU institutions: European Commission, EESC,

European Parliament etc. • Advises national regulators and instituions in UK,

France, Spain, Portugal, Austria, Netherlands, Italy • Collaboration with professional stakeholders across

Europe

5th June 2013 Barcelona

www.europecrowdfunding.org Benoit Vandevivere

Regulatory Hurdles

• Prospectus Directive • (2003/71/EC, amended by 2010/73/EC) • Accepting reclaimable funds • (Directives 2006/48/EC & 2009/110/EC) • Undertakings for Collective Investment in Transferable

Securities (UCITS directive) • Alternative Investment Fund Managers (AIFM directive) • Markets in Financial Instruments Directive (MiFID & MiFID II) • Corporate law provisions for SMEs with large shareholder No.

5th June 2013 Barcelona

www.europecrowdfunding.org Benoit Vandevivere

Carlos Silva, President & Chief Operating Officer, Seedrs

Investing in startups made simple and rewarding

Carlos Silva President, COO and Co-Founder ECIA Conference – 5th Jun 2013

What is Seedrs?

seedrs.com / @seedrs

Seedrs is an online platform allowing anyone to invest in startups

•  Launched in July 2012

•  Fastest growing equity corwdfunding platform in the world

•  Operating in the UK

•  Launching in rest of Europe by the end of the year

Seedrs Limited is authorised and regulated by the Financial Conduct Authority

What pain does Seedrs address for entrepreneurs?

•  Great demand for seed-stage capital

(<£150.000)

•  VCs don’t do small investments

•  Angels rarely do real seed

RESULT

Many potentially great startups never get off

the ground due to lack of capital

seedrs.com / @seedrs

Entrepreneurs lack access to genuine seed-stage capital

Seedrs Limited is authorised and regulated by the Financial Conduct Authority

What pain does Seedrs address for investors?

• Very appealing investments

•  Strong net returns

•  Excitement factor

•  Friends and family want to support

• Very high transaction costs

• Only top 1% can actually diversify

seedrs.com / @seedrs

RESULT

Many people would love to allocate a portion of their capital to startups but can’t currently do so

Investing in startups offline takes a lot of time and money

Seedrs Limited is authorised and regulated by the Financial Conduct Authority

Why do investors and entrepreneurs love Seedrs?

Invest small amounts in startups they like

INVESTORS ENTREPRENEURS

Money Access capital from a wide

range of investors

Get connections, advice and support

Base of mavens

One sophisticated shareholder

Provide support, or else be passive

Wisdom of the crowds

No administrative or legal work

Support

Validation

Simplicity

seedrs.com / @seedrs

BENEFIT

Seedrs Limited is authorised and regulated by the Financial Conduct Authority

How have we done so far?

25 startups funded

> 15,000 registered members

>€1.5M invested

0

50

100

150

200

250

300

350

400

450

500

550

600

Q3 2012 Q4 2012 Q1 2013

Net Investments (in £000s)

seedrs.com / @seedrs Seedrs Limited is authorised and regulated by the Financial Conduct Authority

Seedrs Limited 2 Chapel Place Rivington Street London EC2A 3DQ United Kingdom www.seedrs.com

carlos.silva@seedrs.com

Questions?

Seedrs Limited is authorised and regulated by the Financial Conduct Authority.

R. Aprígio Mafra, 17, 2Esq. 1700-051 Lisboa Portugal

Ramon Saltor, CEO, The Crowd Angel

The problem

• Valuation

• Legal framework

• Structuring

• Risk Diversification and co-investment

• Time consuming

• Follow up

We did not invest!

Value Add to investor

Deal Flow P2P Filtering Professional Structuring Follow up

Investment “grade”

Charity

Fan Support

F, F &F

Venture Capital

Recommendation Access

A hybrid between crowdfunding and VC

REQUIERES: • High level of involvement • Understanding the

entrepreneurship and the sector

• High wealth

OFFERS: • Involvement as wanted • High diversification of your

investments • Security in the investments

From “BUSSINES ANGEL”… … to the “CROWD ANGEL”

A hybrid between crowdfunding and VC

Venture Capital experience and methodology at the service of individual investors

To invest in winning teams, with innovative projects and high growth potential

The Inveready Group facilitates access to the country’s best entrepreneurial projects

1 A rigorous selection process

€3,000 tickets, as many tickets as you want

Legal contracts, that guarantee investor rights, have been made in accordance with the standards of Venture Capital

Crowd Angels syndicate their investment

2 A standardized investment process

Quarterly follow up reports sent to the Crowd Angels

Two positions in the BOD for the Crowd Angels

3 Investments monitoring

Monitoring (Board and Council voting, etc) can be performed through a system of on-line voting

The whole investment process can be done on-line, thanks to the implementation of digital signature

4 Online: Investment and monitoring

1 DIRECTLY

(by registering in the platform)

2

5

PARTNERS (Business angels

networks, Business shcools alumni, investors

clubs, etc)

A big network

As easy to decide as an online coupon

As easy to contract as an App

As easy to maintain as a listed share

As proactive as a Business Angel

The Crowd Angel, our vision

Contact: Ramon Saltor Donada Tel: (0034) 93 186 01 14 rsaltor@thecrowdangel.com

The Crowd Angel C/ dels Cavallers 50 08034 Barcelona

www.thecrowdangel.com