The history of crowdfunding is relatively short compared to the scope of history, however, many key events have taken place within its modern inception and subsequent brief timeline. The information given below represents a partial, yet substantive view of the various pieces of the crowfunding landscape that have developed since around the beginning of the 21st century.
The first dedicated crowdfunding platform, ArtistShare, was established in the year 2000. The crowfunding platform space expanded consistently every year thereafter.
2001 to 2008
Between 2001 and 2008, a number of very significant crowdfunding developments took place. A microlending site called Kiva emerged in 2005 which specialized in offering small loans to entrepreneurs in poor areas of the world. In 2006, Lending Club launched, the now highly prominent peer-to-peer lender. It provided a new and convenient way to acquire funding without the normal restrictions present within the traditional banking industry. In the same year, another peer-to-peer lender, PROSPER, was also established.
In 2008, the rewards-based crowdfunding platform Indiegogo was established. This platform offered a way to donate to your charities of choice by eliminating the middleman.
2009 to 2011
Between 2009 and 2011, the crowdfunding developed into a highly popular means for entrepreneurs and startups to gain recognition, test ideas and acquire funding. Revenue based from crowd funding tripled from $530 billion in 2011 to $1.5 billion in 2011.
In 2009, KICKSTARTER launched – a reward-based crowd funding platform for creative projects.
One of the most soon-to-be powerful donation-based crowd funding platforms, GoFundME, had its launch in 2010.
In 2011, CircleUp, a now highly popular equity crowdfunding platform was established.
2012
A highly significant year in crowdfunding, 2012 brought the signing into law of the Jumpstart Our Business Startups (JOBS) act. This act was aimed at reducing regulations on small businesses. It legalized equity crowd funding and removed the ban on general solicitation. In the same year, the equity crowdfunding platform, FUNDABLE, was established. In the wake of this law, VerifyInvestor.com was established, a platform providing companies an easy, cost-effective and compliant method to verify their investors as accredited investors, and do so in a confidential manner. In the same year, the equity crowdfunding platform, FUNDABLE, was established.
2013
Title II of the JOBS act was implemented in 2013, which established the parameters for general solicitation and ‘accredited’ investors. In the wake of this law, VerifyInvestor.com was established, a platform providing companies an easy, cost-effective and compliant method to verify their investors as accredited investors, and do so in a confidential manner.
2014 to 2015
Real estate crowd funding expanding significantly during this period of time. According to Massolution it reached $1 billion in 2014, $2.5 billion in 2015 and is expected to reach $3.5 billion in 2016. (Reference — http://businesspress.vegas/columns-blogs/real-estate-note-book/real-estate-crowdfunding-still-its-infancy)
Additional provisions of the JOBS Act were implemented in 2015, including Title III, allowing anyone to invest $2000 or more into a non-public company in exchange for equity. As well, Title IV was implemented, which gives issuers a ‘mini-IPO’ option and encourages equity platforms to publicly solicit non-binding expressions of interest.
