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Crowdfunding gives entrepreneurs a chance to get funding with the help of investors and other people via social media.
In emerging markets such as Africa and Asia, crowdfunding also exists and thrives. However, these markets are not yet fully evolved compared to crowdfunding campaigns in the U.S. One of the concerns is the unscaled growth for bigger data. This big data at the disposal of companies would only trigger their desire to have more. Companies need to have structure and a proper system so they can manage these concerns.
Addressing these various issues that involve accelerators, startups and investors is the main reason why Digital Arts Media Network (OTCMKTS:DATI) was formed. DATI is an investing platform that makes it easy for all parties involved. DATI supports disruptive innovations by connecting investors (private and pubic), startups and accelerators. The company helps angel investors gain liquidity in two years without touching their equity in startups.
How does DATI make this happen? They offer specialized capital formation programs to fast-track development and success of startups. Based on the Public Accelerator-Incubator (PAI) model, DATI gives angel investors a quick return on investments from their private investments. As such, more startups can benefit and more investors will be able to provide assistance in this setup.
Another help for startups in these two markets is various localized efforts. Disrupt Africa is doing an event that is open across the continent, which presents the most promising startups every year. For Asia, China prides itself on JD.com. When compared to Indiegogo and Kickstarter in their infancy stage, JD.com was able to raise more funds, $491 million compared to Indiegogo’s $56.5 million in venture capital and Kickstarter’s $10 million.
Crowdfunding in Africa
Crowdfunding in Africa is gaining popularity. In 2016, Africa was home to 57 active crowdfunding platforms. In 2015, the crowdfunding platforms were able to raise $32.3 million, which went on to fund SMEs, real estate projects, charity projects and social causes, among others. Among its success stories is the Wealth Migrate, a real estate project, which was able to raise $12.7 million to acquire four medical buildings in the U.S.
Support overseas is also pouring in for startups in Africa. About $94.6 million went to fund local initiatives in 2015. The World Bank estimates that by 2025, crowdfunding in the region could grow to $96 billion with a projected 300 percent annual growth rate. However, there are still plenty of challenges to overcome.
An entrepreneur will post his project on these platforms Afrikstart, Thundafund or M-Changa, but the reach is limited. Some platforms only entertain funds coming from wealthy nations and most investors come from the same entrepreneur’s social network. This inhibits potential investors outside his or her circle to contribute or donate funds. As such, the payment methods play a large part when choosing a crowdfunding platform in Africa. The industry is also not regulated yet so investors have little protection.
Crowdfunding in Asia
Asia is a known technohub, most especially in Singapore and Hong Kong. The role of incubators and accelerators is to provide a link between startups and mentors, funding, investors and potential partners.
According to Fintech News, one of the most popular accelerators in the region is the Startupbootcamp Fintech Singapore, which focuses on financial innovation. It provides a physical office, funding, and access to global network of investors, mentors and venture capitalists. The chosen startups will be given three months to build their financial products with the help of over 400 collaborators.
On the other hand, a blockchain startup incubator in India was set up last year. Aptly called Satoshi Studios, the blockchain incubator is the first of its kind in Southeast Asia. The name was derived from the creator of Bitcoin, Satoshi Nakamoto.
Startups will be given three months and S$50,000 in investments in exchange for 8-15 percent equity. Satoshi Studios was founded by Sahil Baghla, Nikunj Jain, and Ayush Varshney. When a startup is selected to the program, it will go to Delhi, India, for three months and collaborate with other startups in the region to build the “blockchain knowledge hub of Southeast Asia.”
Women entrepreneurs will also get a boost in Asia. Woomentum is a community-based crowdfunding platform mainly for women who are founders and entrepreneurs. Woomentum started in forums and AMAs (Ask Me Anything) events. Soon, the members tripled and founder Mouna Aouri Langendorf had no choice but to launch her passion project.
She also launched a separate website called Woomentum.fund, which acts as Kickstarter or Indiegogo. It provides opportunities for projects to get funds, but Langendorf acknowledges that not all site visitors want to provide investments. Instead, she put up a “Follow” and “Influence” buttons, aside from “Fund” button to cater to different interests.
Compared to Africa, crowdfunding in Southeast Asia seems a bit more convenient because the governments throw their full support, plus, there are regulations to protect investors and entrepreneurs.
With the help of DATI, the connections between angel investors, accelerators and startups are stronger and processes are streamlined for faster access to funding. DATI also offers Crowdfunding and Token Generating Events (aka Initial Coin Offerings) which are both hot commodities right now. By gaining access to these platforms, the issues and challenges faced by startups in emerging markets such as in Southeast Asia and Africa regions are hopefully given effective solutions.
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