Digital Capital Raising - Ukraine

The country in Ukraine is projected to reach a total transaction value of US$7.75m in the Digital Capital Raising market market by 2024.
In 2024, MarketMarketplace Lending (Consumer) is expected to dominate the market with a projected total transaction value of US$3.83m.
When compared globally, the United States leads with the highest cumulated transaction value of US$36bn in 2024.
Ukraine's digital capital raising market is gaining traction, with blockchain technology playing a pivotal role in facilitating efficient and transparent fundraising processes.

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 Ukraine is experiencing significant growth and development.

Customer preferences: Customers in Ukraine are increasingly turning to digital capital raising platforms to fund their projects and businesses. This shift in preference can be attributed to several factors. Firstly, digital platforms offer convenience and accessibility, allowing individuals and businesses to access capital from anywhere at any time. Additionally, these platforms often provide a wider range of funding options, including crowdfunding, peer-to-peer lending, and digital asset offerings, giving customers more flexibility in choosing the right financing solution for their needs.

Trends in the market: One of the key trends in the Digital Capital Raising market in Ukraine is the rise of crowdfunding platforms. These platforms allow individuals and businesses to raise funds from a large number of people, often through small contributions. This trend is driven by the increasing popularity of social media and online communities, which make it easier for projects to reach a wider audience and attract funding. Crowdfunding also allows individuals to validate their ideas and gauge market interest before fully launching their projects, reducing the risk of failure. Another trend in the market is the growing interest in digital asset offerings, such as Initial Coin Offerings (ICOs) and Security Token Offerings (STOs). These offerings allow businesses to raise capital by selling digital tokens or securities to investors. This trend is fueled by the potential for high returns and the ability to reach a global investor base. However, it also presents regulatory challenges, as authorities seek to ensure investor protection and prevent fraudulent activities.

Local special circumstances: Ukraine has a vibrant tech startup ecosystem, with a growing number of innovative companies emerging in various sectors, including fintech, e-commerce, and software development. These startups often face challenges in accessing traditional sources of funding, such as banks or venture capital firms. As a result, they turn to digital capital raising platforms to secure the necessary funds for growth and expansion. The government has also recognized the importance of supporting these startups and has implemented various initiatives to foster entrepreneurship and innovation.

Underlying macroeconomic factors: The development of the Digital Capital Raising market in Ukraine is also influenced by macroeconomic factors. The country has a large population of tech-savvy individuals, with high internet penetration and smartphone usage. This provides a fertile ground for the growth of digital platforms and the adoption of new technologies. Additionally, Ukraine has a relatively low cost of living and labor, making it an attractive destination for outsourcing and offshoring. This has led to the emergence of a skilled workforce and a thriving IT industry, which further supports the growth of the Digital Capital Raising market. In conclusion, the Digital Capital Raising market in Ukraine is experiencing rapid growth and development. Customers are increasingly turning to digital platforms for their funding needs, driven by convenience, accessibility, and a wider range of financing options. Crowdfunding and digital asset offerings are among the key trends in the market. Ukraine's vibrant tech startup ecosystem and supportive government initiatives further contribute 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.