Intérêt du crowdfunding dans le financement de son entreprise ? par Thibaut de Briey | Liege...

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Intérêt du crowdfunding dans le financement de son entreprise ?

Thibaut DE BRIEY, MyMicroInvest

Avec le soutien de :

Crowdfunding interest in financing businesses ?

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

“Simply defined, crowdsourcing represents

the act of a company or institution taking a

function once performed by employees and

outsourcing it to an undefined (and generally

large) network of people in the form of an

open call. This can take the form of peer-

production (when the job is performed

collaboratively), but is also often undertaken

by sole individuals. The crucial prerequisite is

the use of the open call format and the large

network of potential labourers”.

Definition (by J.Howe 2006)

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

Client Firm

Firm X

Firm X

Firm X

Firm X

Outsourcing

Crowdsourcing

The client firm selects one supplier

The client firm sends an open call

The selected supplier performs and is paid according to the contract

Individuals work for free or paid

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

How much weigh is this ox?

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Lior Zoref at TED2012

• The lowest guess was 308 pounds (+/- 139 kg)

• The highest was more than 8,000 pounds (+/- 3,600 kg)

• The average was 1792 pounds (+/-

806 kg)

And real weight ? The ox weights 1,795 pounds (+/- 808 kg)

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

Did you know that we help the New York Times and Google Books to digitalise archives via ReCaptcha ?

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• ReCaptcha uses the crowd to solve the problem of recognizing words in old books and newspaper

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

Challenger

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Dow Jones 8 minutes after the explosion

- 3%

- 3%

- 3%

- 12%

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

The Wisdom of the crowd

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Collective Intelligence

Research and sharing new

ideas

Strengthen the skills and

share the workload

Increase the reliability of predictions

Conditions to capture collective intelligence :• Diversity (variety of point of view)• Independence • Decentralization of sources• Large crowd• Appropriate mechanism to

aggregate

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

How many M&Ms are in this jar?

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?

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

x =

A little Money A lot of People The power of crowdfunding

By pooling small contributions of money …

… from groups of people who share different interests …

… everyone has the power to achieve financial goals …

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

Crowdfunding is not a new concept !

Crowdfunding since 1884

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The origins of Crowdfunding

Le web 2.0 Crowdsourcing The wisdom of the crowd Crowdfunding

Technological + Mentality revolution

= Crowdfunding boom

Technological revolution :- Web functionalities - Social networks boom

Mentality revolution :- Financial crisis- Consumption choices

2010 2011 2012 2013200920082007

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Facebook members (#)

Google Volume index on the word “Crowdfunding”

Total funds raised on crowdfunding campaigns (USD)

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The Crowdfunding Market

Global Market Categories Risks & Opportunity

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# 1.1 million

crowdfunding campaigns

Source : 2013CF – Massolution (report)

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The Crowdfunding Market

Equity(Financial return)

Lending(Financial return)

Rewards(Non financial return)

Donation(Philanthropy)

5%$115m

(+30% vs. Y-1)

43%$1,170m

(+111% vs. Y-1)

16%$383m

(+527% vs. Y-1)

36%$979m

(+45% vs. Y-1)

The crowdfunding market is divided into 4 categories

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Global Market Categories Risks & Opportunity

Source : 2013CF – Massolution (report)

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The Crowdfunding Market2

• $1,400

Donation

• $2,300

Reward

• $4,700

Lending

• $190,000

Equity

Typical campaign sizes across the different crowdfunding models

Global Market Categories Risks & Opportunity

Source : 2013CF – Massolution (report)

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The Crowdfunding Market2

Global Market Categories Risks & Opportunity

Source : 2013CF – Massolution (report)

Forecast (2013)

5,2 billions of USD

In France one considers that crowdfunding will be a significant market after reaching 500 millions EUR

In the world that would say 50 billions

In Belgium : +/- 92 millions

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The Crowdfunding Market2

Emerging crowdfunding platform

Global Market Categories Risks & Opportunity

Source : 2013CF – Massolution (report)

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The Crowdfunding Market

Crowdfunding failure press articles

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Global Market Categories Risks & Opportunity

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The Crowdfunding Market

Crowdfunding failure specific cases

Product never delivered

Unsatisfied community

Uncontrolled investor community

Fake Project

What about crowdfunding in 5 years ?

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Global Market Categories Risks & Opportunity

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Wiseed – Crowdfunding Platform3

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Equity-Based crowdfunding

Social economic context

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Crowding out Equity Gap Confidence

The Economy Entrepreneurs People

Context Equity Gap Case Legal framework

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Equity-Based crowdfunding

Equity Gap

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SME Cash-Flow

SME Development stages

Pre-Seed Seed Start-up

Business Angels

Early Growth Expansion / Development

3Fs

Maturity

Venture Capital

Private Equity

Trade Sale / IPO

Series A Series B Series C

MBO

MBIEquity Gap

Context Equity Gap Case Legal framework

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The Crowdfunding Market

The crowdfunding opportunity for our economy

Source : MyMicroInvest

Context Equity Gap Case Legal framework

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Equity-Based crowdfunding

Legal Framework in Europe

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European Prospectus directive

General Rule

Exceptions

• Obligation to publish a prospectus before any public offering above a certain threshold

• Maximum Threshold: 5,000,000 EUR but member states can set the threshold at a lower amount

• If addressed to qualified investors (institutions, companies or individuals)

• If addressed to less than 150 persons (natural or corporate body)

• If the total amount do not exceed 100,000 EUY (12 months)

Other Directives

• Credit institutions, Financial instruments markets, payment services, electronic money, Alternative Instrument market funds (AIMF), money laundering)

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Context Equity Gap Case Legal framework

Equity-Based crowdfunding

National Legal Framework in European member states

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Diversity in setting the threshold for the requirement to prepare a prospectus

First Legislation in Europe for crowdfunding

• Threshold of 100,000 EUR : Belgium, France, Germany ...• Threshold of 5,000,000 EUR : Italy, UK, …• Other Threshold : 2,500,000 EUR (NL), 1,500,000 EUR

(Finland), 1,000,000 EUR (Cheque Republic), …• Special schemes

• Italy

Other countries with legislative reform or ongoing reflection

• France, UK, Austria, …

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Context Equity Gap Case Legal framework

Equity-Based crowdfunding

Crowdfunding: risks and opportunities

Risks Opportunities Need

Crowd structureSource of funding

MarketingCollective intelligence

Structuring

Mis-selling(Information – Valuation)

FraudGovernance

MaterializationFinancial Alternative

Regulation&

Information

For Crowd

ForEntrepreneur

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Context Equity Gap Case Legal framework

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MyMicroInvest

Our reason for being

Vision Mission Action

Build the economy of tomorrowConnect savings with

companies’ funding needs

Enables anyone to invest any amount starting from 100€

alongside professional investors in high potential SMEs

Venture Capital

Crowd

+

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DNA MyMicroInvest is … Structure Team

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MyMicroInvest

Pros & Cons

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DNA MyMicroInvest is … Structure Team

Crowdfunding Venture Capital

AccessibilityMaterialization

Meaning

Selection & AnalysisFollow-up

Exit

AccessibilityMaterialization

Meaning

Selection & AnalysisFollow-up

Exit

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MyMicroInvest

Collaboration as DNA- Crowdfunding as a complementary funding solution -

Professional structure and investment process … (Venture Capital dimension)

… reinforced by the community intervention (Crowdfunding dimension)

Selection Investment Follow-up Exit

Professional financial validation

Conditions &

Investment

Coaching &

RepresentationExit optimisation

Selection Investment Follow-up Exit

Concept validation by the community

Co-investment- Same conditions -

Promotion&

Support

Remuneration- Same conditions -

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DNA MyMicroInvest is … Structure Team

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MyMicroInvest

MyMicroInvest its …

A platform (MyMicroInvest – Crowdfunding)

An investment vehicle (Inventures – Venture Capital)

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• Launched in September 2012• 400 visits/day• 8,300+ active members• 3 financed projects (7 en 2013), 34 selected• 1,620,000 € raised• Accenture Innovation Awards (Financial Services)• Regulated emissions with a prospectus (FSMA)

• Funding of societal innovation• 5 realized investments• Co-selection et co-investment with the crowd• +4 million euros managed• Investment Committee (B.Colmant, J.Zurstrassen, etc.)

DNA MyMicroInvest is … Structure Team

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MyMicroInvest

The Platform : 2 Pans of activities

Selection

Objectives :

• Visibility and credibilityConstruction of a community

• Advice and enhancementExchange views

• Meeting with professional investors Pros investors (6 deals in progress and 1,3mi EUR raised by the projects listed in selection)

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Co-investment

Objectives :

• Financial leverageDouble professional investment (1.6 mi EUR raised on MyMicroInvest)

• Collective advicesShare of the network and mobilisation

• Marketing toolCommunity of ambassadors

1st entrepreneurship showcase in Belgium

1st equity-based crowdfunding platform in

Belgium

DNA MyMicroInvest is … Structure Team

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MyMicroInvest

Selection : a real ID card

DNA MyMicroInvest is … Structure Team

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MyMicroInvest

Investment : transparent, simple and structured

Investment details

Co-investor details

DNA MyMicroInvest is … Structure Team

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MyMicroInvest

Collective intelligence case study

DNA MyMicroInvest is … Structure Team

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The main added value of the crowd is POST-INVESTMENT

Online platform offering practical tools for separated parents

Natural products for allergic people (first application: trap for dust mites)

Observations

Network sharing

Sales force

Strategy challenger

Expertise

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MyMicroInvest

Structuration of the operation

Investors CrowdMyMicroInvest S.A.

Start-ups/SMEs

Equity

Invest in SMEs’ equity

Equity-linked notes(investment specific)

Manager

MyMicroInvest Finance S.A.

Subscribed to securities Issued by MMiF

DNA MyMicroInvest is … Structure Team

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MyMicroInvest

A multidisciplinary team

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DNA MyMicroInvest is … Structure Team

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Conclusion

Crowdfunding interest in financing businesses

Source of financing Collective intelligencePowerful

marketing tool

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Conclusion

Crowdfunding interest in financing businesses

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SME Cash-Flow

SME Development stages

Pre-Seed Seed Startup

Business Angels

Early Growth Expansion / Development

3Fs

Maturity

Venture Capital

Private Equity

Trade Sale / IPO

Series A Series B Series C

MBO

MBIEquity Gap

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Reality

Entrepreneur Business plan

Crowdfunding effect

Thank you for your attention

Contact: olivier@mymicroinvest.com +32 477 40 30 80

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