Crowdfunding Market to grow by USD 540.1 Billion (2025-2029), increasing social media use for free promotion boosts market, AI-driven market evolution - Technavio

NEW YORK, Feb. 6, 2025 /PRNewswire/ -- Report on how AI is driving market transformation - The global crowdfunding market size is estimated to grow by USD 540.1 billion from 2025-2029, according to Technavio. The market is estimated to grow at a CAGR of  20.5%  during the forecast period. Increasing use of social media as source of free-of-cost promotion is driving market growth, with a trend towards crowdfunding campaigns as avenues for crowdsourcing. However, high time-consuming process  poses a challenge. Key market players include Chuffed.org Pty Ltd., Companisto GmbH, ConnectionPoint Systems Inc., Crowdcube Ltd., Crowdera Inc, Crowdfunder Ltd., DonorsChoose, FUELADREAM Online Ventures Pvt. Ltd., Fundable LLC, Fundly, GGF Global Ltd., GoFundMe Inc., Indiegogo Inc., Ioby Inc., Ketto Online Ventures Pvt. Ltd., Kickstarter PBC, Kiva Microfunds, Patreon Inc., Republic, and Wishberry Online Services Pvt. Ltd..

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Market Driver

Entrepreneurs, businessmen, creators, filmmakers, musicians, and artists turn to crowdfunding platforms for alternative capital when traditional channels like banks and venture capitalists fall short. The public plays a crucial role in supporting these project creators by contributing funds. Online platforms connect potential investors with startups and individual projects. Regulations vary by location and can impact credit score and net worth requirements for large investments. Technology, including AI and machine learning, streamlines the process. Media & entertainment, real estate, healthcare, and the cultural sector are popular industries for crowdfunding. Fraud and misuse of funds are concerns, but transparency, regulations, and investor due diligence help mitigate risks. Funding goals, financial risks, reputation, and credibility are influencing variables for investors. Social media platforms and crowdfunding sites expand a project's reach to a global audience. Equity crowdfunding allows investors to own a piece of the business, while donation-based crowdfunding supports charities and causes. Influencer marketing and social networking sites can boost a campaign's success. Pre-seed and seed capital are common funding stages for startups. AI and machine learning can help predict project success and customer satisfaction. Crowdfunding platforms play a vital role in product development and business growth. 

In traditional product development and customer acquisition processes, there was limited interaction with customers prior to product launch. With the rise of crowdfunding campaigns, entrepreneurs can now engage directly with their target audience, gauging interest and expectations before bringing a product to market. This interaction offers valuable insights into the demand-pull or technology push factors that influence investment and marketing strategy. In contrast to post-purchase behavior analysis in conventional methods, crowdfunding campaigns enable a more proactive approach to understanding customer needs and preferences. 

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Market Challenges

• Entrepreneurs, businessmen, creators, filmmakers, musicians, and artists turn to crowdfunding market for alternative capital when traditional channels like banks and venture capitalists fail to provide sufficient funds. The public plays a crucial role in this market by offering support through online platforms. Individual investors and startup firms contribute to funding projects, providing much-needed resources for project creators. However, challenges exist. Regulations, location, credit score, and net worth can impact an investor's decision to contribute. Large investments come with financial risks, including potential fraud and misuse of funds. Reputation and credibility are essential for both project creators and investors. Technology, media & entertainment, real estate, healthcare, and various industries have embraced crowdfunding. AI, machine learning, and social media platforms have made it easier for potential investors to connect with projects that resonate with them. Equity crowdfunding and donation-based crowdfunding are popular models. Cultural sector, pre-seed capital, and seed capital campaigns are common. Influencing variables include awareness, investor base, and social networking sites, which can reach a global audience. Despite these advantages, challenges remain, including fraud, misuse of funds, funding goals, and financial risks. Ultimately, the success of a crowdfunding campaign depends on effective product development, customer satisfaction, and transparency.
• Crowdfunding is a method for entrepreneurs to finance their product development and marketing efforts through individual investments. This process involves several stages, including product registration, making the product compliant with standards, and securing initial investors. These pre-launch tasks can be time-consuming and may lead to delays in crowdfunding projects. Fixed deadlines for project completion can result in a loss of customer support if not met, leading to refunds or even project cancellations. These delays and cancellations can negatively impact investor confidence in the global crowdfunding market.

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Segment Overview 

This crowdfunding market report extensively covers market segmentation by  

• Type
• P2P Lending
• Equity Investment
• Hybrid
• Reward
• Others
• Deployment
• On-premises
• Cloud
• Geography
• APAC
• Europe
• North America
• South America
• Middle East And Africa
• Application
• Food & Beverage
• Technology
• Media

1.1 P2P lending- In the crowdfunding market, Peer-to-Peer (P2P) lending stands out as a popular model where a lender provides funds directly to a borrower without intermediation from financial institutions. Several factors fuel the growth of this segment. Firstly, P2P lending allows individuals to access funds for planned activities faster as lenders liquidate funds before loan terms end. Secondly, online portals facilitate minor investments, benefiting small businesses. Thirdly, the interest earned through P2P lending is considered part of personal savings, attracting more customers. Fourthly, entrepreneurs with a business plan and over two years of experience are more likely to secure loans. Lastly, government initiatives support the market's growth. However, the market expansion through P2P lending is predicted to be slow during the forecast period due to fewer participants in certain regions and the type of projects seeking funds. Start-ups with limited experience may discourage investment, and P2P lending typically does not cater to large amounts unless it's for a business.

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Research Analysis

Crowdfunding is a revolutionary method for Entrepreneurs, Businessmen, Creators, Filmmakers, Musicians, Artists, and various individuals to raise funds for their projects. The public plays a crucial role in this process by providing Support through online platforms. Artificial intelligence and machine learning are increasingly being used to enhance the crowdfunding experience, analyzing trends and influencing variables to help Fundraisers reach potential Contributors. Startup companies and Investors also benefit from this market, with equity crowdfunding allowing for shared ownership. Social media platforms and Government efforts amplify reach, while Social networking sites serve as powerful marketing tools. Charities and Donors also utilize crowdfunding for philanthropic causes. The donor's decision can be influenced by various factors, including the project's merit, marketing strategies, and personal connections.

Market Research Overview

Crowdfunding is a revolutionary method for Entrepreneurs, Businessmen, Creators, Filmmakers, Musicians, Artists, and others to raise funds for their projects from the General Public. Online platforms serve as business platforms, connecting Project Creators with Potential Investors, Startup Firms, and Individual Investors. Alternative capital sources like Crowdfunding offer an opportunity for accessing funds beyond Traditional Channels such as Banks and Venture Capitalists. Location, Credit Score, and Net Worth are key influencing variables for Investors' decision-making process. Technology, including Artificial Intelligence and Machine Learning, plays a significant role in the Crowdfunding Market. Social Media Platforms and Social Networking Sites expand the reach to a Global Audience. Equity Crowdfunding, Donation-based Crowdfunding, and Crowdfunding for various sectors like Media & Entertainment, Real Estate, Health care, and Cultural Sector are popular. However, risks such as Fraud, Misuse of Funds, Funding Goals, Financial Risks, Reputation, and Credibility are concerns that need addressing. Regulations and Awareness are essential for maintaining trust and transparency in the Crowdfunding Market.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

• Type
• P2P Lending
• Equity Investment
• Hybrid
• Reward
• Others
• Deployment
• On-premises
• Cloud
• Geography
• APAC
• Europe
• North America
• South America
• Middle East And Africa
• Application
• Food & Beverage
• Technology
• Media

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

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SOURCE Technavio