Crowdinvesting, also known as equity crowdfunding, is a growing trend in the investment landscape worldwide. It allows individuals to invest in early-stage companies or projects in exchange for equity or other forms of financial return. In Kenya, the crowdinvesting market is also experiencing significant development, driven by several factors.
Customer preferences: Kenyan investors are increasingly drawn to crowdinvesting due to its potential for high returns. With traditional investment options offering limited returns, crowdinvesting provides an opportunity for individuals to diversify their investment portfolio and potentially earn substantial profits. Furthermore, crowdinvesting allows investors to support local businesses and projects, fostering a sense of community and pride.
Trends in the market: One notable trend in the Kenyan crowdinvesting market is the emergence of platforms that cater specifically to local entrepreneurs and projects. These platforms understand the unique needs and challenges faced by Kenyan businesses, making it easier for entrepreneurs to access funding. Additionally, there has been a rise in sector-specific crowdinvesting platforms, focusing on industries such as technology, agriculture, and renewable energy. This trend reflects the growing recognition of the potential for growth and innovation in these sectors in Kenya.
Local special circumstances: Kenya has a vibrant entrepreneurial ecosystem, with a high number of startups and small businesses seeking funding to fuel their growth. However, accessing traditional financing options can be challenging for these businesses, as banks often require collateral and have strict lending criteria. Crowdinvesting provides a viable alternative, allowing entrepreneurs to raise capital from a large pool of individual investors. Additionally, crowdinvesting platforms often provide mentorship and support services to help entrepreneurs succeed, further enhancing the appeal of this funding option.
Underlying macroeconomic factors: Kenya's strong economic growth and increasing middle class have contributed to the development of the crowdinvesting market. As more individuals have disposable income, they are looking for investment opportunities that offer higher returns than traditional savings accounts or real estate. Crowdinvesting provides a way for Kenyans to participate in the growth of local businesses and potentially earn significant profits. Furthermore, the government of Kenya has implemented policies and initiatives to support entrepreneurship and innovation. This includes the establishment of innovation hubs and incubators, as well as the creation of funds and tax incentives for startups. These efforts have created a conducive environment for crowdinvesting to thrive, as entrepreneurs have access to resources and support to turn their ideas into successful businesses. In conclusion, the crowdinvesting market in Kenya is experiencing significant development due to customer preferences for high returns and support for local businesses. The emergence of platforms catering to local entrepreneurs and sector-specific investments reflects the unique needs and opportunities in the Kenyan market. The vibrant entrepreneurial ecosystem and supportive government policies further contribute to the growth of crowdinvesting in Kenya.
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.
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