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Crowdfunding raised billions in 2012

Posting in Technology

The crowdfunding industry experienced a high growth rate and raised billions of dollars for businesses and other fundraising projects last year, a trend that looks like it will continue.

An industry report from Massolution found that crowdfunding raised $2.7 billion in 2012, an 81 percent increase from 2011, for more than one million campaigns. The data was collected from 308 active crowdfunding platforms from around the world, though the majority of the campaigns were from North America and Europe.

And the future only looks brighter for the industry.

"[W]ith regulatory bodies continuing to pave the way, we expect global crowdfunding volumes to exceed $5 billion in 2013,” said CEO of massolution and Crowdsourcing.org, Carl Esposti, in a statement. “While lending-, donation-, and reward-based crowdfunding have thus far been leading this global financial revolution, equity-based crowdfunding is about to take center stage in the U.S. The JOBS Act, which will allow non-accredited investors to make investments in exchange for equity, is expected to go into effect by the end of 2013.”

With the possibility of equity-based crowdfunding beginning in the U.S., Massolution believes that 2013 could be an even better year for the crowdfunding market. The report projects that the total funds raised will again double, to $5.1 billion worldwide.

The most popular form of crowdfunding is the reward-based system, popularized by sites like Kickstarter and Indiegogo, which brought in $1.4 billion. Lending-based crowdfunding raised $1.2 billion, while equity-based raised $116 million.

Read more about the report here.

Photo: Flickr/epSos.de

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— By on April 9, 2013, 5:34 AM PST

Tyler Falk

Contributing Editor

Tyler Falk is a freelance journalist based in Washington, D.C. Previously, he was with Smart Growth America and Grist. He holds a degree from Goshen College. Follow him on Twitter. Disclosure