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Scotland Racing Ahead in Crowdfunding

The Scottish Crowdfunding Report 2016 was published this month and provides a fascinating update on the benchmarks established in the 2013 report and demonstrates Scotland’s rapid advance in UK crowdfunding.

Scottish Crowdfunding Reporttwintangibles was pleased to be commissioned to research and write both of these important reports on the specific and distinctive characteristics of crowdfunding in Scotland.

Significant progress has been made in the past three years from a position where we suggested that the low adoption rates of crowdfunding in Scotland  were perhaps a missed opportunity to a position where Scotland is outstripping the rest of the UK in its growth rates.

The report is focused on the use and impact of crowdfunding on business and has used a consistent approach across the two reports to ensure comparability. Drawing on crowdfunding activity data analysis, survey material and expensive interviews and focus groups the report highlights a number of key feature. Notably it demonstrates a significant the increase in the Scottish share of the value created from crowdfunding in the UK.  Scotland has jumped from a position of less than 1% of the UK total to 4% and this at a time when the UK crowdfunding sector has been growing at a remarkable rate. In the period the data was gathered Scotland raised some £27 million pounds through crowdfunding. The bulk of that, some £20 million, was raised through the Lending model. The dominance of the lending model is not a surprise and is in common with the rest of the UK but it is worth noting that in the Reward space Scotland commands around 7% of the UK totals raised.

Scottish Crowdfunding Report

Through the course of the three years the sector has matured significantly with both the size and nature of campaigns growing along with the range of sectors accessing these funds and the stage in a business life cycle where the funding is being sourced. For example we can see evidence of more mature businesses accessing crowdfunding, no longer is it considered simply for start-ups. A particularly interesting case included in the report highlights an investor exit using a crowd loan to finance the deal.

We suggested back in 2013 that it was not unreasonable to see Scotland’s share of the UK crowdfunding totals to reach around 8%. Some disagreed with this but the evidence seems to suggest that Scotland is getting there and we still stand by that aspiration.

The report was once again supported by the Glasgow Chamber of Commerce along with three new partners for this edition, those being Harper Macleod the law firm that has done so much to champion equity crowdfunding north of the border, LendingCrowd the Edinburgh based innovative crowdlending platform and Santander which as  one of teh major high street banks is demonstrating considerable engagement and openness to the crowdfunding sector, not least through their support of the report.

The full report is available for download free of charge in soft copy for the Glasgow Chamber of Commerce website.

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twintangibles Ltd is a company registered in Scotland with company number SC397987. Registered office is Blue Square House, 272 Bath Street, Glasgow, Scotland, G2 4JR

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