Russia’s crowdinvesting to grow 25 times within 5 years, analysts forecast
8 Sep '17
In 2016, the Russian crowdinvesting and crowdlending market reached a fairly modest $20m, Firrma reported, citing research data from analysts at VentureClub.co, a Russian crowdinvesting platform.
According to the Central Bank of Russia, Russia’s entire crowd-sector raised around $34m last year, with $20m of this amount generated by four domestic platforms that operate on a purely crowdinvesting/crowdlending model (VentureClub.co, Starttrack, Simex, and Alfa Potok). Globally, the market for crowdinvesting and crowdlending topped $24bn in 2016, according to Goldman Sachs.
The experts believe crowdlending is more popular in Russia than crowdinvesting because it is thought to offer a clearer fund-return mechanism; crowdlending platforms “already compete successfully with banks in SME lending.” On the other hand, PE and angel investors are growing increasingly interested in crowdinvesting as well—despite the fact that angel investors account for only about 20% of total venture investing in Russia, a far cry from 80% in the developed markets.
VentureClub analysts forecast that within just five years Russia’s market for crowdinvesting and crowdlending will reach $500m, hitting a tangible $4.5-5bn mark by 2027 already.
Crowdinvesting, aka equity crowdfunding, is an alternative financial tool to bring capital into start-ups and small businesses from a broad-based microinvestor community.
Crowdlending enables individuals (P2P model) or companies (P2B) to borrow from other individuals via special Internet platforms.