Reward-Based Crowdfunding - Ukraine

The Reward-Based Crowdfunding market in Ukraine is projected to reach a total transaction value of US$756.90k in 2024.
When compared globally, it is evident that the United States leads with a transaction value of US$465m in the same year.
Ukraine's Crowdfunding market is gaining traction as a popular choice for capital raising among tech startups and social enterprises.

Definition:

Reward-Based Crowdfunding is a financing form independent from financial institutions, location of the campaign creator or investor. Reward-Based Crowdfunding campaigns can be initiated for a wide range of different purposes such as product launches, art-, music- and film-financing, software development, scientifc research etc. Usually there is a financing goal defined by funding volume and time to reach this goal for every campaign. The campaign creator publishes engaging content (e.g. photos, videos, text) that explain the goal and motivation of the fundraising. Almost everyone can participate in reward-based crowdfunding campaigns as an investor. The only prerequisite is a valid payment account.

Additional Information:

Key players in the reward-based crowdfunding campaigns are Kickstarter and Indiegogo.

Reward-based Crowdfunding
Pre-financing of products, art, music and films, software or scientific research
e.g. Kickstarter, Indiegogo

Traditional venture capital investments
Equity-based Crowdfunding (see Crowdinvesting)
Lending-based Crowdfunding (see Crowdlending)

The Crowdfunding market in Ukraine has been experiencing significant growth in recent years, driven by changing customer preferences and local special circumstances.

Customer preferences: One of the key reasons behind the development of the Crowdfunding market in Ukraine is the growing preference among customers for alternative funding sources. Traditional banking services have become less attractive due to stricter regulations and limited access to credit. As a result, individuals and businesses are turning to Crowdfunding platforms as a way to raise funds for their projects or ventures.

Trends in the market: A major trend in the Crowdfunding market in Ukraine is the rise of reward-based Crowdfunding. This type of Crowdfunding allows individuals or businesses to offer rewards or incentives to backers in exchange for their financial support. This trend can be attributed to the increasing popularity of creative projects, such as art, music, and film, which often rely on Crowdfunding to finance their endeavors. Additionally, equity-based Crowdfunding is also gaining traction in Ukraine, as investors seek opportunities to invest in promising startups and businesses.

Local special circumstances: Ukraine has a vibrant startup ecosystem, with a number of innovative and high-potential companies emerging in recent years. However, access to traditional funding sources, such as venture capital and bank loans, can be limited for these startups. Crowdfunding provides a viable alternative for these companies to raise capital and bring their ideas to life. Furthermore, the low cost of living and relatively low wages in Ukraine make it an attractive destination for Crowdfunding campaigns, as the funds raised can go a long way in supporting projects and ventures.

Underlying macroeconomic factors: The development of the Crowdfunding market in Ukraine can also be attributed to underlying macroeconomic factors. The country has experienced significant political and economic challenges in recent years, including the annexation of Crimea and the ongoing conflict in the eastern regions. These factors have resulted in a need for economic diversification and the promotion of entrepreneurship. Crowdfunding has emerged as a key tool in supporting the growth of small and medium-sized enterprises, as well as fostering innovation and creativity in the country. In conclusion, the Crowdfunding market in Ukraine is developing rapidly due to changing customer preferences, local special circumstances, and underlying macroeconomic factors. The rise of alternative funding sources, such as Crowdfunding, is enabling individuals and businesses to access capital in a more efficient and flexible manner. As the market continues to evolve, it is expected that Crowdfunding will play an increasingly important role in supporting entrepreneurship and driving economic growth in Ukraine.

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.