Crowdfunding in Canada’s tech sector is only getting bigger, as startups, enterprises, and everything in between are looking for ways to fund, brand and grow their operations. Globally, crowdfunding markets grew from $6.1 billion in 2013 to $16.2 billion in 2014. But what does the future hold on the crowdfunding front – and what do the tech innovators of today need to do to prepare for it? To meet the need for answers, the National Crowdfunding Association of Canada (NCFA) will host VanFUNDING 2015, an interactive and immersive half-day crowdfunding conference on September 29 in downtown Vancouver’s iconic Library Square location.
“Crowdfunding is taking off globally and Canada is at risk of falling behind.”
– Craig Asano, Founder and Executive Director of NCFA Canada
Speakers and event partners for VanFUNDING are a veritable who’s who crowdfunding and marketplace lending platforms in Canada along with leading service providers, such as Crowdfund Suite, PwC, Frontfundr, FundRazr, Grouplend and Lending Loop. To get a preview of what to expect at the event, we asked Crowdfund Suite CEO Bret Conkin, about the state of the crowdfunding marketplace.
The biggest driver of interest in crowdfunding today is the sheer growth of capital being raised, Conkin explains. “We’re going to see growth from $16.1 billion in 2014 to a projected $34.4 billion in 2015, according to industry researcher Massolutions. It’s entered the mainstream. Now, many entrepreneurs want to know about their platform options and the new startup crowdfunding regulation brought into six provinces. What are the guidelines? Where and how can they take advantage?”
Another trend has been the launch of debt crowdfunding or marketplace lending in Canada via platforms like Lending Loop and GroupLend, Conkin adds. “The sheer innovation in FinTech, from smart contracts and bitcoin to blockchain technology will also be a key area of discussion.”
If this event and others like it are a sign that Canada’s community is getting on the crowdfunding bandwagon, the truth is that in some regards we’re a bit late to this party. “Crowdfunding is taking off globally and Canada is at risk of falling behind,” says Craig Asano, Founder and Executive Director of NCFA Canada.
“China, by way of an example is organizing a several thousand person conference in October and is flying in international speakers to participate and share what they’ve learned,” Asano adds. By comparison, we’re going to have some catching up to do.
It’s not just bleeding-edge startups that are interested in the sector, either. “VCs and Institutional investors are partnering with platforms to raise additional capital from a new investor class,” Conkin says. “Just look at InvestX in Private Equity deals, The OCMx institutional crowdfunding and this week’s launch of NexusCrowd. Accredited investors are getting access to deals that were never before available and can participate at smaller amounts and leave due diligence to the professionals. CrowdMatrix, which is speaking at VanFUNDING, is a portfolio company of Toronto-based VC.” Then there’s Extreme Venture Partners (EVP), who have also invested in a crowd analytics company.
The trends are clear. “Technology is working hard to reduce the costs of financial transactions, facilitate global financings and leveraging big data to improve investment decisions. But before advances like equity crowdfunding go mainstream, we need more education – which means more events like this one,” Conkin says. “That’s why many attendees are coming to VanFUNDING 2015: to connect with the education and people that can fund their ventures or add the crowd to their investment portfolio.”