Digital Capital Raising - Bulgaria

The country of Bulgaria is projected to reach a total transaction value of US$14.15m in the Digital Capital Raising market market by 2024.
In the same year, MarketMarketplace Lending (Consumer) is expected to dominate the market with a projected total transaction value of US$9.17m.
A global comparison reveals that the United States leads in cumulated transaction value, with US$36bn expected in 2024.
Bulgaria is experiencing a surge in digital capital raising activities, with blockchain technology being increasingly utilized in the capital raising market.

Definition:

The Digital Caiptal Raising segment relates to digital financial services for business customers, and private borrowers. Included are Crowdinvesting models, which focus particularly on start-ups exchanging investment for company shares (equity-based), and Crowdfunding solutions, which are used for non-monetary compensation, for example product launches, music, art & film financing (reward-based). The market also includes bank-independent loan allocation for SMEs (Crowdlending) and for personal loans (Marketplace Lending or so-called Peer-to-Peer lending) through private or institutional investors via online platforms. In view of processing complexity, this market is focused on small and medium-sized enterprises (SMEs), freelancers and private persons. Bank financing is not considered, neither are any financial aspects that reach beyond the scope of small and medium-sized enterprises or donation-based Crowdfunding models.

Structure:

Digital Capital Raising consists of Reward-Based Crowdfunding, Crowdinvesting, Crowdlending and Marketplace Lending.

Additional Information:

The market comprises of transaction values, campaigns, average funding per campaign.

Alternative financing for SMEs and freelancers
Equity-based Crowdfunding (or Crowdinvesting)
Reward-based Crowdfunding (or Crowdfunding)
Alternative lending for SMEs and freelancers (bank-independent loans)
Online marketplaces for personal loan applications and private investors
Peer-to-Peer loans with interest rates depending on internal credit scoring of the platform provider

Traditional bank loans
Traditional venture capital investments by institutional or private investors

The Digital Capital Raising market in Bulgaria has been experiencing significant growth in recent years, driven by several key factors.

Customer preferences: Bulgarian investors have shown a growing interest in digital capital raising platforms, attracted by the convenience and accessibility they offer. These platforms provide a streamlined process for raising capital, allowing companies to reach a wider pool of potential investors. Additionally, investors are increasingly comfortable with online transactions and are seeking investment opportunities beyond traditional channels.

Trends in the market: One of the major trends in the Bulgarian Digital Capital Raising market is the rise of crowdfunding platforms. These platforms allow individuals to invest in a wide range of projects and businesses, giving them the opportunity to diversify their investment portfolios. This trend is driven by the demand for alternative investment options and the desire to support local entrepreneurs and startups. Another trend is the emergence of peer-to-peer lending platforms. These platforms connect borrowers directly with lenders, bypassing traditional financial institutions. This trend is fueled by the demand for easier access to credit and the potential for higher returns for lenders.

Local special circumstances: Bulgaria has a vibrant startup ecosystem, with a growing number of innovative companies looking for funding. Digital capital raising platforms provide an alternative to traditional financing options, such as bank loans or venture capital, which may be more difficult for startups to access. This has led to increased adoption of digital capital raising platforms by Bulgarian entrepreneurs.

Underlying macroeconomic factors: Bulgaria's favorable macroeconomic conditions have also contributed to the growth of the Digital Capital Raising market. The country has experienced steady economic growth in recent years, with low inflation and a stable currency. This has created a favorable environment for investment and has attracted both domestic and foreign investors to the market. Furthermore, the Bulgarian government has implemented policies to support entrepreneurship and innovation, including tax incentives for startups and initiatives to promote access to financing. These policies have helped to create a supportive ecosystem for digital capital raising and have encouraged the growth of the market. In conclusion, the Digital Capital Raising market in Bulgaria is developing rapidly due to the preferences of customers for convenient and accessible investment options, as well as the emergence of crowdfunding and peer-to-peer lending platforms. The local startup ecosystem and favorable macroeconomic conditions have further contributed to the growth of the market.

Data coverage:

The data encompasses B2C enterprises. Figures are based on transaction values / revenues / assets under management and user data of relevant services and products offered within the FinTech market.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending, population, internet penetration, smartphone penetration, credit card penetration, and online banking penetration. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

Crowdfunding is the collective effort of a large number of individuals who network and pool small amounts of capital to finance a new or existing business venture. Each campaign is set for a goal amount of money and a fixed timeframe, each day is counted down and the money raised will be tallied up for visitors to follow its success. The size of the global crowdfunding market is growing and the largest markets are North America and Asia.