A recent report by the UK charity Nesta and Cambridge University shows that more than 90% of investors’ (and donors’) resources have been committed to debt crowdfunding projects in the UK in 2014.
While equity crowdfunding projects generate a lot of news, their actual share of committed resources is currently only around 5% with the bulk of investors’ interest going to much less risky projects in consumer and – predominantly – business lending.
Overall, the alternative finance market, which includes all above mentioned categories, has grown above 160% from 2013 to 2014 in the UK. Equity crowdfunding is expected to gain market share, given that this category has expanded the most: 400% compared to 250% for P2P business lending and a somewhat more modest 100% for P2P consumer lending. Interestingly, also rewards based crowdfunding (small in overall size) is still growing strongly with 200%, even though it is the oldest category, built on the success of Kickstarter, the US crowdfunding pioneer.