Success Factors in Reward based and Equity based Crowdfunding in Finland

2.2.2. Current State of Crowdfunding 
Crowdfunding is a financing option, which has yet to fully stabilize in both the eyes 
of the public and the eyes of the government. It is a practice that is still evolving and 
is far from routine (
Vasileiadou et al., 2015). According to Vasileiadou et al. (2015) 
there is limited indication of stabilization of the learning processes in crowdfunding. 
Despite its newness, crowdfunding as a financing market has grown exponentially in 
the past few years. The number of projects being funded and crowdfunding platforms 
being launched is increasing. 
Figure 1 shows the yearly totals being raised globally 
via crowdfunding. The volumes have increased from 0,8 billion US dollars in 2010 to 
16,2 US dollars in 2014. Although the amounts may appear small in relation to total 
venture funding, they clearly demonstrate the rapid growth of the market
(Belle-
flamme et al., 2015)
.

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Master’s Thesis 
15 
Figure 1: Yearly global totals of crowdfunding (
Belleflamme et al., 2015) 
Being a highly growing practice it is distressing to see that legal regulation regarding 
crowdfunding is still undeveloped. Currently, there is no uniform established policy 
for crowdfunding in Europe. This is concerning since in 2011 one third of the world’s 
crowdfunded capital was raised in Europe and there were approximately 200 active 
crowdfunding platforms in Europe. (De Buysere et al., 2012) 
The US congress on the other hand passed the JOBS act in 2012, exempting crowd-
funding for registering with the Securities and Exchange Commission. This rule po-
tentially makes crowdfunding the most popular exemption that businesses could uti-
lize to raise capital. (
Sigar, 2012) 
Despite the evolving state of the legal regulation of crowdfunding, the practice is 
growing rapidly and gaining popularity amongst the public. People are participating in 
crowdfunding both as entrepreneurs and funders. 
 
0.8 
1.4 
2.5 
6.1 
16.2 
0 
5 
10 
15 
20 
2010 
2011 
2012 
2013 
2014