One of the reasons investment crowdfunding is such an important addition to the financial ecosystem is that it offers the potential to bring capital to projects and businesses poorly served by traditional ways of raising money.
That’s the theory at least, so it’s exciting to start seeing actual data to back it up. PwC has just released a report called Women unbound: Unleashing female entrepreneurial potential, and it’s full of data points suggesting that women have not only embraced crowdfunding as a tool for fueling entrepreneurship, but that so far at least they’re simply better at it than their male counterparts:
While the report does spend some time digging into the reasons why women might be doing better with crowdfunding campaigns, the big takeaway for me is just how obvious it becomes that traditional angel and venture financing paths work against women entrepreneurs, leaving a massive “financing gap” that represents tremendous opportunity to fuel the kind of entrepreneurship that has always been the beating heart of our economy:
To be clear, the report focuses on what PwC refers to as “seed crowdfunding” (we’ve referred to it before as “rewards-based crowdfunding”), where backers don’t receive any equity or debt investment in the business, but instead are typically pre-funding product or service development. But when looking through the data and the report’s analysis, it’s hard not to imagine we’ll see similar outcomes over time when it comes to the newer equity crowdfunding variants, especially Reg CF and Reg A+ (Reg CF portal Republic recently posted their own analysis showing 79% of the funding on their platform goes to women founders), which open up the supply side of the funding ecosystem to a much wider group of investors (ie, everyone), so is more like the audience for rewards-based crowdfunding campaigns.
While of course many who invest (in crowdfunding or otherwise) are interested in a specific return, the report does a nice job of highlighting a more nuanced look at the reasons people support various projects and campaigns, reasons that can certainly overlap with — but are not dependent on — a specific financial outcome: