CROWDFUNDING SYSTEMS: evaluation and government regulation in the conditions of reengineering

have certain differences, advantages, and disadvantages. The comparative characteristics of crowdfunding, business angels, and venture capital financing are shown in Table.1.7. Table 1.7 The comparative characteristics of crowdfunding, business angels, and venture capital financing Comparison parameters Sources of financial support for startups Financing through crowdfunding Financing with the help of business angels Venture financing 1 2 3 4 Time frame for deciding by an investor Quick decision (up to 1 month) Considered decision (more than 1 month) Considered decision (more than 1 month) Cost of funding for recipients Commission 5–10% of the amount + share in the capital (sometimes) Share + dividends Share + dividends Number of participants A large number of contributors 1 or syndicate Venture company The average amount of project financing (in US dollars) 10 000–500 000 25 000–200 000 or up to 1 000 000 800 000–25 000 000 Stage of development of the investment object Pre-project stage of a startup Project stage of a startup Pre-project stage of a startup Project stage of a startup Stage of startup development. Startup expansion stage. Complex financial conditions of the company Other advantages of the selected financing method Analysis of potential consumers' opinions Mentoring and advice Contacts The investor's participation in the management Does not participate in the management Not always involved in the management Participate in the governing council Publicity Information about the project is available in the mass media Information about the project is not available in the media Information about the project is not available in the mass media 44