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

because they expect to make a profit. These accredited investors aim to provide startups with the necessary financial resources, as a result, they receive a share in the equity capital of the funded startup. The idea is that as soon as the company becomes profitable, the «business angel» can receive dividends or successfully sell their shares to other investors for profit. Business angels can operate independently or as part of a large investment group, sometimes referred to as a syndicate. On average, «business angels» invest in a startup approximately 25 to 100 thousand. dollars. The main advantage of this method of financing is that there is no need to return funds. This financing is different from conventional lending, where there is a legal obligation to repay the loan, and they bet that the company's market value will increase in value over time. Another advantage is that «business angels» share their long-term experience with the founders of startups, which can be of great importance for the long- term success of the business ( ɍɝɨɥɶɤɨɜɚ , 2017b). When comparing crowdfunding and venture capital, it is difficult to say which is better or more promising. Scientists and economists who believe that venture business is stronger and more promising, defend their position with these arguments: ڰ legal regulation of venture business is more complete and comprehensive; ڰ the scale of fundraising is large; ڰ venture investors provide mentoring, they can offer their own experience and help in future capital raising; ڰ low risk of potential copyright infringement. Venture investors accept the high risk that startups carry, but expect a return of between 25% and 35% per year over the life of the investment. According to the US small business administration, the number of small business loans is declining every year. Thus, for the period 2012 — 2017, the total amount of loans for small businesses decreased by 20%. It is also important that almost 96% of business plans received by accredited investors, «business angels» and venture companies are rejected. It is worth noting that startups and enterprises at an early stage of their operation received the largest share of all investments at the rate of 32% in 2016. In European countries, startups and other young enterprises were funded in the amount of 8.6 billion euros in 2015, of which 6.1 billion euros were received through business angels, 2.1 billion euros through venture financing, and 0.4 billion euros through crowdinvesting (Fig 1.7). 46