Our Mission to Make Crowdfunding Global: The Story So Far…
“One of the beauties of a cryptocurrency is how it enables a shared global ecosystem for so many interactions, and opens things up in places where systems are less developed.”
David Ives, Ex-CTo of Crowdcube
Crowdfunding is a multi-billion dollar industry. In 2015 it was valued at an estimated $35 billion — that estimation is predicted to reach the trillion mark within the next 10 years. It is easy to see why — the basic idea has revolutionised the way that projects are funded. It held an early promise that no matter what your background or connections, if you’ve got a great idea you can make it a reality.
Unfortunately it’s a little more complicated than that. As the major crowdfunding platforms grew in popularity, so too did the competition. Skip forward to where we are now, and only a small percentage of projects that apply get a chance to share their campaign on the leading platforms such as Kickstarter and Indiegogo.
Acorn are on track to create a crowdfunding platform for everyone — it will be the world’s first to be completely free and open to any legal project in any country. We’re doing this through blockchain, allowing us to use cryptocurrency to effectively crowdfund our own crowdfunding platform. This means that we won’t have to charge anything to the end user.
What are the barriers to existing crowdfunding?
Shuts out Most Countries: Many of the leading platforms like Kickstarter will not host campaigns from a long list of countries, mainly related to their economic status. This means that most developing and non-Western countries are unable to even apply for the platform, let alone get funded.
Need to have an Existing Budget: In the majority of cases the difference between getting your project on the platform and not, is having impressive content to showcase your idea, or a prototype, this — of course — requires an existing budget.
It May Not Get Funded: Even if you manage to get your project on the platform — only a third of projects reach their target. In All or Nothing (AON) platforms this means that even after months of time, and money, spent on promoting your campaign, you could end up with nothing.
High Fees : Even once a project is listed on the major platforms, a fee of between 8 and 10% is charged of the full amount raised. This is a significant amount of money for start- up businesses or NGOs.
Payments Can Be Cancelled: With All or Nothing (AON) platforms such as Kickstarter, the funds are not collected until a campaign has reached its goal. Since pledges are added through debit and credit cards, pledges can be cancelled or card details changed before a campaign finishes. This can leave the founders with a significant shortfall that they have to fill.
So whilst the crowdfunding sector is undoubtedly growing exponentially, there are huge parts of the world that are not feeling the benefit. Ironically, these are often parts of the world that need it most.
The Need For Crowdfunding Globally
Since the beginning of our journey to create our crowdfunding platform, we have been involved in extensive discussions with well-placed accelerators and entrepreneurs around the world.
We have spoken to ambitious individuals in countries such as Ghana, Pakistan, Bangladesh, Nigeria and Kenya. By speaking directly to people who connect entrepreneurs and start ups in the developing world to funding, we were able to gauge just how desperate the need is for access to crowdfunding. Many of the accelerators we’ve spoken to have a growing list of talented entrepreneurs, with innovative ideas, but little to no opportunities for funding.
Using accelerators, we are not only able to make direct connections with the individuals and projects that need the funds most, but we are able to get a clearer picture of how to structure our platform to maximise its utility in the future.
Other than the barriers to accessing current platforms previously mentioned, we have found that some developing countries struggle to get any kind of investment into the country, despite having a burgeoning market for start-ups.
We have a growing list of early applications from projects in countries all over the world, from Lithuiania to Nigeria, Canada and Australia.
Just a few of the diverse and innovative applications we’ve had so far are:
- An Exo- Hand Which Restores Movement
An Exo-Skeleton which allows patients who have suffered a stroke to rehabilitate the muscles in their hands. The founder wants to make the technology affordable to developing countries such as his home country Columbia.
- Meals Worms as a Food Source
Creating a sustainable, nutritious food source through the mass production of mealworms fed off waste food. This project hopes to ultimately create a sustainable food source with little to no carbon footprint. Watch the project video
- Football Academy in Nigeria
This football academy wants to give children and young people in Ondo State in Nigeria the chance to combine education with football to make football into a career.
The Next Step
We’ve had an encouraging level of early interest in our platform — this is a clear sign that demonstrates not only the value of what we’re doing, but also symbolises the clear frustration at the existing barriers to gaining funding.
In the early days of the platform we want to get as many projects using it as possible. For this reason we’re offering early adoption incentives by matching the level of funding raised for the projects that are signed up when we launch.
The conversations we’ve had so far have shown that there is a lot of incredible talent, ideas and innovation coming from developing nations. This is the opportunity that many of these projects need to succeed.
Over the coming months we will be putting all of our efforts into ensuring that as many people as possible find out about our platform.
In the words of David Ives, former CTO of Crowdcube — the world’s first equity crowdfunding platform;
“I’d like to see Acorn provide the opportunities beyond Europe that I’ve seen crowdfunding provide within it — and within other established economies. Creating a global opportunity is a thrilling idea.”
Join us on our journey to democratise crowdfunding globally.