At first glance, the current economic situation does not seem to have had an impact on crowdfunding campaigns. On the pages of Ulule or KissKissBankBank, the campaigns are continuing, and while time is running out the amounts seem to continue to increase.
However, some projects are suffering from an ambient gloom that goes beyond the economic area. “There is a slowdown in the campaigns that need to be launched. For those that are underway, some are impacted, others are not,” explained Vincent Ricordeau, CEO and co-founder of KissKissBankBank.
On the entrepreneurial side, concern also remains “from an economic point of view, of course, concerning the survival of our small, fledgling company, but above all from a health point of view.” When health becomes the priority, the desire to “communicate about the campaign” is no longer there, not to mention the parties and other events organized to thank the precious donors,” confided Mathilde Guillier, founder of Zèbre et Colibri.
To gain a deeper insight into crowdfunding and to find out the latest economic news from around the world, check out our companion app, Born2Invest, available for free in PlayStore.
The COVID-19 pandemic has a different impact on crowdfunding depending on the platform
The situation does not affect all SPVs in the same way. Within Goodeed, a platform that allows non-governmental organizations to finance by watching advertisements (acquired by KissKissBankBank and Banque Postale in 2018), “there is a slowdown in the implementation of campaigns but their business model is little affected in the end,” said Vincent Ricordeau.
With regard to Lendopolis, a crowd equity subsidiary of Banque Postale, the situation is a little more complex, because the platform faces a double responsibility towards companies and investors. “We are in the midst of discussions with our communities on this issue. We should give companies a two-month period to let the epidemic pass,” said Ricordeau, even though none of the companies on his platform are having problems at the moment.
And what about the same platforms whose economic health depends on the commissions earned on holdings? “We are a subsidiary of Banque Postale, so we are fairly calm and solid, which is not necessarily the case for other companies in the sector, which are at risk of a fairly high cash burn,” said the CEO and co-founder of KissKissBankBank.
Extending campaigns as a solution for some crowdfunding projects
Whether in crowdfunding or crowd equity companies, adaptation and flexibility are a must. As soon as the crisis started, Ulule sent an email to its Ululeurs offering the most vulnerable people to extend their campaign for a few weeks.
Mathilde Guillier wanted to take advantage of this solution. “We preferred to postpone the end of our campaign by 15 days to take a step back, “get used” to the situation and think about how to present – approach – communicate perhaps different to what was planned.” The same goes for KissKissBankBank, which gave 30 extra days to entrepreneurs who needed it.
Tudigo, which enables private individuals to invest in companies, decided to launch a loan offer starting from $1 to $54,000 (€10 to €50,000) to help VSEs and SMEs cope with the economic downturn. Repayments will be deferred for 3 to 6 months.
In terms of support, meetings and workshops are often “transformed into an online event,” said Ulule. Digital tools allow teams to continue their activities and to continue to support start-ups and project leaders. As with the rest of the economy, crowdfunding is adapting while waiting for a return to a calmer and less anxious climate.
DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
First published in Maddyness, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.
Rental real estate seen as a safe haven in France
The crowdfunding platform My Korner Shop has an original model of crowdfunding, investing in rental real estate, in this case...
UN calls for the cancellation of $236 billion in African debt
In response to the pandemic and the economic "tsunami" affecting developing countries, The United Nations Conference on Trade and Development...
A sharp drop in Italy’s GDP can no longer be avoided
Confindustria’s forecasts showed that a sharp drop in Italy’s gross domestic product (GDP) is now inevitable. The estimates are based...
Genfit is adapting its activities in accordance to the coronavirus pandemic
Biotech companies worldwide are trying to find a vaccine to halt the coronavirus pandemic. The French Group Genfit announced that...
Blockchain technology can help the energy industry be more efficient
BlockApps has entered into a partnership agreement with the consulting firm Optimum to develop block solutions for tracking how energy...
- Featured7 days ago
Why should banks and FinTech operators ally?
- Crowdfunding7 days ago
Several organizations accept donations in cryptocurrencies to fight the pandemic
- Biotech7 days ago
Italian biotech companies entered the race to find a vaccine against COVID-19
- Africa7 days ago
COVID-19 and the violent fall in oil prices wreak havoc on Africa’s economies