Where and how do public authorities and crowdfunding platforms collaborate?
Crowdfunding and Peer-to-Peer Lending has become an important tool to improve access to finance for SMEs. Collaboration with public authorities improves Crowdfunding - by providing co-financing, lending credibility, guaranteeing returns and leveraging public spending.
As part of a joint research project, Karsten Wenzlaff, Ronald Kleverlaan and Ana Odorovic have collected examples of Crowdfunding platforms collaborating with public authorities. The list is presented below - if examples are missing, feel free to add them in the comments.
What is meant by a "public authority" in this context?
- A national, regional or local government, a ministry within the government, a government agency (like a Financial Market Supervision agency, or a Business Innovation agency)
- A municipality, province or cluster of boroughs, districts or cities
- A bank which is owned by a public entity, for instance to create incentives for investments in SMEs or Start-Ups
- A foundation set-up by a public entity, for instance to allow the management of public parks or education institutions.
As can be seen, the list considers a wide-range of public authorities. In following, are the examples that can be identified by December 5th 2020. It will be updated based on feedback from the platforms.
Austria: TourismPlatform
The Austrian Tourism Bank is owned by the OEKB, takes over many responsibilities for the Austrian Government. On behalf of the Austrian Federal Ministry for Sustainability and Tourism, it handles the federal funding of commercial tourism. Conda provides white-label services to the TourismBank by operating the platform We4Tourism
Austria: Support to CF project owners in Graz
The city of Graz supported the preparation of a crowdfunding CF campaign by a company based in Graz. The funding can be obtained for creative services of Graz needed for preparing a crowdfunding campaign.
https://www.wirtschaft.graz.at/cms/beitrag/10266560/6963342/
Belgium: Flemish Community Commission & Growfunding
The Belgian Sociaal-Cultureel Werk – VGC provided a follow-up funding to community development projects on the reward-based platform Growdfunding.
https://www.growfunding.be/en/bxl/page/our-network
Croatia: Support of Split-Dalmatia County to CF platorms
In cooperation with the Public Institution RERA S.D. for Coordination and Development of Split-Dalmatia County, the International Crowdfunding Center in Zagreb supports the development of innovative companies. RERA finances 30% of the project value, while the remaining 70% applicants will be collected through a crowdfunding campaign.
Estonia: Loans to Creative Industry SMEs via Fianora Capital
The Cultural and Creative Sectors Guarantee Facility (CCS) is part of the Creative Europe program (2014-2020). A EUR 6 million guarantee to Finora Capital allowed the digital lender to provide loans for SMEs in cultural and creative sectors. Finora Capital is a balance-sheet business lender.
https://finoracapital.eu/en/for-investors/
https://ec.europa.eu/commission/presscorner/detail/en/ip_20_1900
France: October-Private Credit to SMEs through the EIF
In 2019, the European Investment Fund (EIF) used the “Private Credit Tailored for SMEs†program to provide 100m EUR in loans, alongside institutional investors, to SMEs in Europe, through the platform October.
https://www.eif.org/what_we_do/guarantees/news/2019/efsi-eif-october.htm
Germany: Aescuvest.eu - Grant given to Platform by EIT Health
Aescuvest is a German Crowdfunding platform focusing on start-ups in the area of eHealth, digital health and biotechnology. EIT Health is a network of Healthcare institutions, such as Pharma companies, research universities, medical associations, which invests into medical innovation. EIT Health provided a grant to Aescuvest to launch a European wide Crowdfunding platform to intermediate securities with prospectus in order to passport the service across Europe.
Germany: Crowdfunding-Berlin-Technical Support
When the City of Berlin decided to use crowdfunding to support local investment, it offered services that supported the development of the regional crowdfunding ecosystem. The meta-platform allowed potential investors to search Berlin-based projects from a range of platforms. The city also ran a crowdfunding competition which gave prices to the best crowdfunding campaigns in different branches. The meta-platform also offered consultants the opportunity to present themselves and has an FAQ for crowdfunding supporters.
Germany: Schleswig-Holstein operating a donation-based Crowdfunding platform
The Investitionsbank Schleswig-Holstein is a publicly owned bank of the federal state of Schleswig-Holstein. They operate a donation-based Crowdfunding platform in partnership with several local saving banks, and regional associations, like the Sport Association of Schleswig-Holstein. Both the local saving banks and the Investitionsbank provide co-funding to selected projects run by citizens from that region.
https://www.wir-bewegen.sh/seite/ibsh
https://www.wir-bewegen.sh/premium-partner
https://www.wir-bewegen.sh/seite/paten-und-partner
Germany: Art defies/ despite Corona (Kunst trotzt Corona): startnext and City of Dresden
With focus on freelancers in the creative industries the city of Dresden provides grants in form of matchfunding (the money of the crowd is matched by 100%, the limit is 2.500€ per project).
https://www.startnext.com/pages/kunst-trotzt-corona/
Germany: #WirvsVirus-Matching Fonds: startnext and Bundeskanzleramt (German Chancellery)
Under the patronage of the German Chancellery a machfunding was established to support initiatives combating COVID-19 respectively consequences of the lockdown for the civil socity. The grants have been provided by private sponsors.
https://www.startnext.com/pages/wirvsvirus/
Germany: kulturMut: startnext and Kulturfonds Frankfurt RheinMain (City of Frankfurt)
With the focus on the creative industries the City of Frankfurt in cooperation with the Aventis foundation provides grants in form of matchfunding (the money of the crowd is matched by 50%, the limit is 5.000€ per project).
https://www.startnext.com/pages/kulturmut
Germany: KulturAktivNortheim: startnext and Rural district of Northeim
With focus on creative industries the rual district Northeim in cooperation with the local bank (Kreissparkasse) has provided grants in form of matchfunding (the money of the crowd is matched by 100%, the limit is 500€ per project). The Private University of Applied Science G?ttingen (PFH G?ttingen) provided coaching and the partner page on Startnext.
Germany: Schotterweg: startnext and City of Bremen/ Bremerhafen (Bremer Aufbau-Bank)
The bank provides coaching and organized a contest (the prize money has been provided by private sponsors). Furthermore the bank set up "MikroCrowd Bremen", a micro-credit for entrepreneurs. Up to 10.000€ as a loan can be financed in addition to the sucessful crowdfunding.
https://www.startnext.com/pages/schotterweg
Germany: NRW.MicroCrowd: startnext and NRW.Bank (State-controlled promotional bank)
It is a micro-credit for entrepreneurs with the focus on social businesses. Up to 50.000€ as a loan can be financed in addition to the sucessful crowdfunding.
https://www.startnext.com/pages/nrwmicrocrowd
Germany: Unikat: startnext and Office of the economic development of the city of Kassel (Wirtschaftsf?rderung Kassel)
Sciencepark Kassel (the startup center of University of Kassel) is running the Partner Page on Startnext. They are providing coaching and organizing contests. The prize money for the contest is acquired through sponsoring. The office of the economic development helps with the acquisition of sponsoring.
https://www.startnext.com/pages/unikat
Germany: Ideenwald: startnext and Ministry of Economics Rhineland-Palatinate (Ministerium für Wirtschaft, Verkehr, Landwirtschaft und Weinbau Rheinland-Pfalz)
The ministry is supporting the network of startup centers (Gründungsbüros) in Rhineland-Palatinate. The startup centers do the coaching of the initiatives with a focus on startups/ businesses.
https://www.startnext.com/pages/ideenwald
Germany: Kreativ München: startnext and City of Munich (Kompetenzteams Kultur- und Kreativwirtschaft der Landeshauptstadt München)
With focus on the creative industries the city of Munich curates projects out of Munich on Startnext and provides coaching and organized a contest. The prize money for the contest has been acuqired through sponsoring.
Until August 2020, it was possible to receive a grant of up to 3.000€ (50% of the costs) for creative industry services, such as image campaigns, video pitches, texte, story-telling support. After August 2020, the rate of support was increased to 75% of the costs.
https://www.startnext.com/pages/kreativmuenchen
Germany: Nordstarter: startnext and City of Hamburg
With focus on the creative industries the city of Hamburg curated projects out of Hamburg on Startnext and provided coaching, a monthly crowdfunding club and grants in form organized contests. Due to the Corona pandemic the city set up a smiliar grant program like Munich. The grant was up to 5.000€ for the creative industry services. https://kreativgesellschaft.org/finanzierung/crowdfunding/hamburger-kampagnenforderung-zzt-nicht-verfugbar
https://www.startnext.com/en/pages/nordstarter
Germany: Dresden Durchstarter: startnext and City of Dresden
With focus on the creative industries the city of Dresden curated projects out of Dresden on Startnext.
https://www.startnext.com/pages/dresden-durchstarter
Germany: HEIDECROWD: startnext and Nbank
Nbank is part of a network consisting of IHK, university and further banks. Nbank provides loans.
https://www.startnext.com/pages/heidecrowd
Germany: IBB Mikrocrowd: startnext and Investitionsbank Berlin (IBB)
It is a micro-credit for entrepreneurs with the focus on social businesses. Up to 25,000€ as a loan can be financed in addition to the sucessful crowdfunding. They also organized a contest providing grants. The focus was on startups/ social businesses based in Berlin.
https://www.startnext.com/pages/ibbmikrocrowd
Germany: MikroCrowd: startnext and L-Bank
It was a micro-credit for entrepreneurs with the focus on social businesses. Up to 10,000€ as a loan can be financed in addition to the sucessful crowdfunding. It is currently revised.
They also did a contest providing grants. The focus was on startups/ businesses based in Baden-Württemberg.
https://www.startnext.com/pages/mikrocrowd
Germany: Hessen MikroCrowd: startnext and Wirtschafts- und Infrastrukturbank Hessen (WIBank)
It is a micro-credit for entrepreneurs with the focus on social businesses. Up to 35,000€ as a loan can be financed in addition to the sucessful crowdfunding. The focus is on startups/ businesses based in Hessen.
https://www.startnext.com/pages/hessen-mikrocrowd/
Germany: Crowd Buddy Baden-Württemberg: startnext and MBG Baden-Württemberg
Providing equity capital between 10.000 and 50.000€ in case the crowdfunding is successful. The focus is on startups/ businesses based in Baden Württemberg.
https://www.startnext.com/pages/crowdbuddy-bw
Germany: Crowd Buddy Niedersachsen: startnext and MBG Niedersachsen
Providing equity capital between 10.000 and 50.000€ in case the crowdfunding is successful. The focus is on startups/ businesses based in Niedersachsen.
https://www.startnext.com/pages/crowdbuddy-niedersachsen
Germany: Crowd Buddy Hamburg: startnext and MBG Hamburg
Providing equity capital between 10.000 and 50.000€ in case the crowdfunding is successful. The focus was on startups/ businesses based in Hamburg. This programm has been terminated by the MBG Hamburg.
https://www.startnext.com/pages/crowdbuddy-hamburg
Italy: Eppela and Smart City Milan – Grant
The city of Milan wanted to invest EUR 400,000 on projects which had a positive social impact. The city reached out to crowdfunding platform Eppelas and asked them to provide offers for white-label versions, i.e. to provide the technology for the facilitation of the campaigns. After a public call, 54 projects were assessed by a committee.18 projects continued to the funding phase. All projects which collected 50% of the target sum would receive an equal co-funding from the city of Milan for the remaining 50%.
https://www.eppela.com/en/mentors/comunemilano
Italy: Donation-based campaign by the city of Bologna on its own platform
The Municipality of Bologna wanted to renovate a historical monument. The campaign took place on their own website, but was implemented with the help of that platform IdeaGinger. 339.000 Euros were raised from 7000 citizens, the remaining 200.000 were provided by the city of Bologna.
https://www.unpassopersanluca.it/contatti.html
Italy: Lazio Innova – Equity
The Lazio Region, as part of its strategy aimed to support investments in the venture capital of innovative startups and companies with a high growth potential in Lazio, launched the INNOVA Venture Capital fund in July 2018. The fund, which is managed by Lazio Innova, co-invests in these companies alongside crowdfunding investors using through equity and quasi- equity instruments.
https://www.lazioinnova.it/innova-venture/equity-crowdfunding/
Italy: KICK-ER – non-financial support
KICK-ER is a service established by Emilia-Romagna Regional Government meant for MSMEs and research laboratories developed with the aim of providing guidance to future project owners on how to prepare and run a crowdfunding campaign.
Italy: October – Investment into Loan Portfolio
The Lending Platform October partnered with 5 Confidi entities belonging to Federconfidi and Rete Fidi Italia and with the European Investment Fund (EIF), to launch a €30 million fund to back Italian SMEs. The fund provided loans alongside the existing institutional and retail lenders, focusing on Italian SMEs that were eligible for the InnovFin SME Guarantee Facility
https://october.eu/the-new-october-italy-fund-for-italian-smes/
Lithuania: Invega - SME-Loan
INVEGA, the Lithuanian National Promotional Institution (NPI), set up a loan instrument called Aviet? in cooperation with FinBee, a lending-based crowdfunding platform operating in Lithuania. Aviet? loans are granted through the crowdfunding platform FinBee, which is in charge of selecting the projects that will be co-funded.
https://turizmas.kaisiadorys.lt/en/business-support/
Lithuania: Invega - Covid19-Loan
Building on their existing partnership, Invega provided 100%-state-funded loans to SMEs seeking a loan on the platform between March and July 2020. They can be paid for the period from 16 March until 31 July 2020. The state provided these loans at a minimum interest rate of 0.1 percent for loans up to 12 months and 0.19 percnt for loans from 13 to 36 months.
https://invega.lt/en/businesses-affected-covid-19-offered-liquidity-loans/
Malta: Zaar Crowdfunding
The Crowdfunding platform ZAAR receives funds from the Ministry for Economy as a sponsorship to help us continue running the platform. They received funding from the Arts Council Malta to help promote the services and the reward-based crowdfunding platform to artists and creatives.
https://www.zaar.com.mt/partners/
Netherlands: Voordekunst – Operation of Platform
The crowdfunding platform Voordekunst in the Netherlands has 20 different partners, including several large municipalities and NGOs use the platform to support projects supporting their policies. Already over 500 projects received match-funding. The partners contributed 20%-30% to the overall funding.Several Dutch provinces decided to distribute a part of their cultural grants via a crowdfunding platform.
Netherlands: Delft and Voorjebuurt
The Dutch City of Delft supported local project owners on the platform voorjebuurt.nl
After applying to the site, the project owners received training and guidance, a contact person within the municipality and up to 2.000 Euros (maximum 50% of the funding target), if the crowdfunding campaign received 20% of its goal and had at least 20 supporters.
https://voorjebuurt.nl/nl/pages/delft
Netherlands: Duurzaam MKB Fonds
Startgreen Capital launched at the end of 2020 a new investment fund for sustainable business looking for funding between €200k-€2million. Companies can additionally raise up to 40% through crowdfunding. The complete loan (including the part from the crowd) will have a state guarantee of 67,5% on losses (BMKB-C).
https://www.duurzaammkbfonds.nl/
Netherlands: Covid19 state guarantees for Alternative Finance
NL Covid-19 state guarantees for alternative finance platforms consists of a 67,5% guarantee for the investor. This can be either the platform [own fund] or a special investment vehicle [used by CF platforms as co-investor].
State guarantees became available to alternative finance platforms during the summer of 2020. It is open for all alternative finance platforms providing loans if at least half of the funding comes from a “professional investorâ€. Crowdfunding platforms are therefore only allowed to use these guarantees when they create a separate SPV with institutional money as co-investor.
Netherlands: City of Apeldoorn operating a platform
The City of Apeldoorn operates its own Crowdfunding platform, in partnership with co-funding from NGOs and local partners. NGOs are providing match-funding for selected campaigns. They receive a grant between €1.000 and €5.000 from partners.
Netherlands: Academic Research Crowdfunding platform of the University of Leiden
In the Netherlands, most universities have their own R&I crowdfunding platforms for researchers. One of the successful platforms is SteunLeiden.nl of the Leiden University. Currently 48 projects have been started and 12.500 people donated to one or more projects. By far the most successful campaign was the #wakeuptocorona. The campaign raised more than €1 million in donations for research on Covid-19.
Netherlands: City of Utrecht and Civic Crowdfunding Platform
The Civic Crowdfunding platform VoorjeBuurt operates a platform on behalf of the City of Utrecht. The City of Utrecht paid for campaigns to receive financial support for preparing the campaign.
Netherlands: EIB and EIF loan facility to Qredits
The EIB in 2016 provided a EUR 100m loan facility to the Dutch micro-finance provider Qredit, coupled with a separate agreement of the EIF to cover part of the credit risk of new loans of EUR 25m micro-loans to businesses. The Dutch Ministry of Economic Affairs guaranteed 80% of the EUR 100m loan facility. Qredits is a Dutch non-profit organization which supports SMEs by providing micro-loans and services. Qredits is not a classic crowdfunding platform, but resembles a micro-loan credit institution, which is characterized as digital lending. The organization is financed by the Dutch State through equity-like funding and guarantees.
https://www.eif.org/what_we_do/guarantees/news/2016/efsi_cosme_qredits.htm
Portugal: Citizenergy-Meta Platform
Citizenergy provides a curated list of crowdfunding projects in the area of energy efficiency. The investors can filter through the projects provided by the platforms. A click on the database entry forwards the investor to the crowdfunding platform, where the investor can follow-through. Citizenergy was supported through the Intelligent Energy Program of the European Union. The lead partner is the Portuguese Energy Cooperative Boa Energia
Spain: GoTeo Co-Funding with the Region of Extremadura
The Spanish platform Goteo has in the past raised more than 11m EUR on the Iberian peninsula. At the same time, the Fundacion Goteo, a non-profit organisation, received 715.000 Euros from public authorities to co-fund reward-based projects. In Extremadura Region, an initiative called Cofinancia was launched in 2013 under the framework of ERDF and ESF operational programme. The aim of this initiative was to provide matchfunding from public resources to micro entrepreneurs who raised at least 10% of their target amount in a crowdfunding campaign.
https://en.goteo.org/call/cofinancia-extremadura/projects
Sweden: Crowdculture and the Stockholm Innovation Fund
The Swedish Platform Crowdculture was one of the first platforms in Europe which implemented the co-funding scheme. The platform development was financed through the Fund of Innovative Culture, a part of the funding portfolio of the city of Stockholm, and Innova, the Swedish Innovation Agency of the Swedish government. On CrowdCulture, the supporters can distribute Sweden’s cultural budget. Each month the support from citizens was matched with funding stemming from different regional or local funds, which have chosen to join CrowdCulture.
Sweden: Trine and Sida
The Swedish Platform Trine partnered with the Swedish Development Agency SIDA to increase the amount of investment into renewable energy projects in Africa. Through a risk-sharing agreement, SIDA covered 60% of the risk of investors willing to lend to renewable energy companies.
United Kingdom: Future Fund
To combat the impact of Covid-19, the UK introduced the Future Fund, which provided a convertible loan to companies which had successfully implemented an equity-based CF campaign. The UK Government made GBP 250 million available for investment through the scheme. The Government loan was matched with a private investor for applications by the investors. Seedrs, and other Equity-Crowdfunding platforms, are implementation partners for this scheme.
https://www.seedrs.com/academy/future-fund/#getthefacts
https://www.gov.uk/guidance/future-fund
United Kingdom: FundingCircle and KfW
In 2018, The German KfW Bank together with the European Investment Fund, part of the European Investment Bank Group, cooperated with FundingCircle. Loans to the volume of 207GBP given to UK SMEs through FundingCircle were securitised and received an investment from the EIB and the KFW.
https://www.fundingcircle.com/uk/
Will add this to the list of examples: https://www.thelocal.es/20180315/spanish-province-launches-worlds-first-state-run-crowdfunding-bizkaia
Thanks to Philip Gr?ter for providing an overview of crowdfunding collaborations between fairplaid Crowdfunding and the VKU Verlag GmbH VKU - German Association of Local Public Utilities https://www.kommunales-crowdfunding.de/projects/overview/
In Denmark V?kstfonden and EKF Danmarks Eksportkredit, two public lending institutions, gurantees and lends money directly to SMEs through danish crowdlending platforms eg. Lendino.
Bernhard Lorig Should I add specific information on the collaboration in Kaiserslautern?
Annika Wallbach is there anything I should add regarding the Unikat example? What was the impact of the collaboration between Startnext and the Science Park Kassel GmbH?