How Crowdfunding Works in Romania?

Author:Madalina Balau
Pages:311-316
SUMMARY

Crowdfunding is increasingly becoming a good solution for entrepreneurial ventures to obtain funds, being facilitated by internet and social networks, and it is also spreading in Romania as well. The current paper aims to explore this alternative for financing in Romania in order to understand better its evolution until now, whether if it is viewed as suitable for business as well, and to compare ... (see full summary)

 
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Social Innovation and Social Economy
311
How Crowdfunding Works in Romania?
Mădălina Bălău1
Abstract: Crowdfunding is increasingly becoming a good solution for entrepreneurial ventures to obtain
funds, being facilitated by internet and social networks, and it is also spreading in Romania as well. The
current paper aims to explore this alternative for financing in Romania in order to understand better its
evolution until now, whether if it is viewed as suitable for business as well, and to compare the advices
offered for entrepreneurs in Romania versus those on famous crowdfunding sites such as Kickstarter and
Indiegogo. In order to achieve this we explored websites offering crowdfunding in Romania and the
information they offer entrepreneurs, we iden tified the types of most successful campaigns and we compared
advices offered to those existing on international websites, renowned for their success. The marketing
strategy and the plan ning of the campaign seem to be essential for its success and this paper highlights in its
conclusion some lessons Romanian entrep reneurs could learn from international crowdfunding campaigns
and the growing scientific literature available on this subject.
Keywords: Crowdfunding; social networks; marketing and business plan.
JEL Classification: M13
1. Introduction
Crowdfunding represents a unique category of fundraising, facilitated by the Internet, but since this
field is just emerging it can be found in a state of evolutionary flux. Thus, crowdfunding is an open
call for the provision of financial resources in form of donation or in exchange for some form of
reward (Schwienbacher & Larralde, 2010) but it can also refer to peer-to-peer lending (Lin &
Viswanathan, 2013) and fundraising initiated by fans of a music group (Burkett, 2011).
Crowdfunding refers to the efforts made by entrepreneurs or groups of individuals who want to fund
their start-ups, by collecting relatively small contributions from a relatively large number of
individuals using the internet, avoiding the usual financial intermediaries.
In Romania, crowdfunding is at its beginning, so the aim of the paper is to find an answer to several
questions related to this kind of solution for obtaining funds: (1) What types of projects are successful
in crowdfunding in Romania? (2) What advices are offered to entrepreneurs for a successful
crowdfunding campaign on each website? (3) Is there a focus on the business perspective in the
initiatives or is the not-for-profit perspective prevailing? (4) What are the recommendations for
entrepreneurial ventures offered by international crowdfunding websites and what additional
recommendations are offered?
1Senior Lecturer, PhD, Department of Economics, Danubius University of Galati, Romania, Address: 3 Galati Blvd., Galati
800654, Romania, Tel.: +40372361102, Corresponding author: madalina.balau@univ-danubius.ro.

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