Efficiency of crowdfunding as institution of global market for venture capital

Abstract

The paper discusses the effectiveness of crowdfunding institution. Crowdfunding is the result of evolutionary institutional changes in the global venture capital market. The crowdfunding institution has lower transaction costs and allocates risks more evenly in comparison with the institutions of business angel and venture fund. Regression models of the effectiveness of global fundraising campaigns with the help of three types of institutions were designed. Comparison of models makes it possible to conclude that crowdfunding as an effective mechanism for organizing venture transactions, which significantly expands the audience of investors and projects that attract investments in the early stages.