3 min read

We’ve put together a presentation that will take you through the history of crowdfunding, and look ahead at how crowdfunding is developing and addressing current issues. Or, if you prefer, you can find the whole history in written form below the presentation.

 

Crowdfunding timeline

1700s – The Irish Loan Fund

Started by Jonathan Swift in the 1700s, the fund provided loans to low-income families in rural areas who had no experience with credit and held little collateral but could still be considered creditworthy. By the 1800s, more than 300 programs throughout Ireland were loaning and it was estimated that at it's peak 20% of all households used the programme.

 

1852 – Credit unions

A credit union is a member-owned financial cooperative, democratically controlled by its members, and operated for the purpose of promoting thrift, providing credit at competitive rates, and providing other financial services to its members.’

Modern credit unions are attributed to Franz Hermann Shulze-Delitzsch, who established the first one in 1852 in Eilenburg.

 

1976 – The Grameen Bank

What started with $27 loaned to 42 women by Dr Mohammad Yunus as part of a research project to give banking opportunities to low-income people evolved in just five years to a programme with more than 30,000 members. The programme transformed into Grameen Bank and has now lent to more than eight million borrowers.

 

1997 – Marillion

British Rock band Marillion raised $60,000 from fans to finance their US tour.

They called it a tour fund and without meaning to created the blueprint for future sites, included ArtistShare (which launched in 2003) to follow.

 

2000 – JustGiving

Donate? No, I’m JustGiving. British company JustGiving was founded by Zarine Kharas and Anne-Marie Huby to provide online tools and processing services to enable the collection of charitable donations.

Many copycats would follow soon after though JustGiving would remain the largest. It claims to have helped individuals and companies raise more than £1 billion for charity.

 

2005 – Kiva

Kiva.org launched and became the first microlending website to connect lenders with low-income/underserved entrepreneurs and students.

As of 2013 Kiva had facilitated more than one million loans at value in excess of $500 million lent.

 

2006 – Prosper

‘The crowd shall Prosper.

Prosper.com launched the first peer-to-peer lending site in the US. This was the first time this type of loan existed outside of developing economies. Prosper formally registered with the SEC in 2009.

 

2006 – The term ‘Crowdfunding’

The first recorded use of the term ‘Crowdfunding’ comes from Michael Sullivan in fundavlog in August 2006.

 

2007 – Lending Club

Lending Club launched the second peer-to-peer lending site in the US Lending Club is significant for raising $125 million in 2013 from the heavyweights including Google.

Lending Club registered with the SEC in 2008. 

Lending Club IPO-ed on Nasdaq on 11 December 2014, the stock ticker symbol is LC. 

 

2008 – Indiegogo

Indiegogo launched at the Sundance Film Festival and became one of the first recognised rewards-based crowdfunding sites. While the initial focus of Indiegogo was film, though this eventually changed to ‘any type’ of idea.

 

2009 – Kickstarter

Kickstarter launched in Brooklyn with the mission of helping bring creative projects to life.

Time named Kickstarter as one of the best inventions of 2010. A little more than a year later TikTok+LunaTik Multi-Touch Watch Kits raise $942,578 of a $15,000 goal in December with 13,512 ‘backers’; both were recordbreaking at the time.

 

2010 – GrowVC

GrowVC launched the first effort into what would eventually to be known as equity crowdfunding.

 

2011 – Crowdcube

Where there’s a crowd there’s a way, and in 2011 Crowdcube launched the world’s first business finance crowdfunding platform and firmly established equity crowdfunding as a concept.

Soon after this, Seedrs launched their own equity crowdfunding offer, which brought investors together under a nominee structure.

 

2013 – SyndicateRoom

SyndicateRoom disrupts the equity crowdfunding party by being the first equity crowdfunding platform in the UK to allow the crowd to co-invest in professionally led opportunities.

 

2014 – The state of the present

Kickstarter alone has now raised more than $1 billion and the industry as a whole was estimated to be worth $5.1 billion in 2013, projected to exceed $10 billion in 2014.

The largest single raise for a project was for the Coolest Cooler, which riased $13,285,226 from 62,642 donors.

In 2013 there were 500 trading crowdfunding platforms and 9,000 domain names registered related to crowdfunding. By the end of 2014 there will be more than 5,000 trading.


Share this: