The Prospect Of "Internet+Crowdfunding" Is Promising. Smes Face Financing Difficulties

According to incomplete statistics, as of June 30, 2015, there were at least 198 Internet crowdfunding platforms launched in China, of which at least 35 had closed down or showed no signs of operation, and 11 had undergone business transformation, accounting for 23% of the total number of platforms.

With the substantial increase in the number of platforms and the layout of crowdfunding industry by e-commerce giants, technology media, and traditional financial institutions, the overall scale of the crowdfunding industry is expanding rapidly. At the same time, the market share of some platforms in the industry is far ahead, ranking the first echelon.

"I think standing Internet plus It will make China's economy fly. " On March 5, Premier Li Keqiang proposed to formulate the "Internet Plus" action plan in the government work report for the first time, and formally established it as a national strategy. The Internet has gradually jumped out of the category of an industry and is becoming a new engine of the national economy.

In response to the Prime Minister's call, China E-Commerce Research Center took the lead in publishing "Internet" think tank series books among major think tanks in the country. This article is selected from the first systematic and panoramic practical work of revealing the "Internet+industry" - "Internet+: industrial outlets". According to the current nationwide Xinhua Bookstore, Airport CITIC Bookstore, Tmall, JD, Dangdang, Amazon China, Suning E-shop, Taobao, WeChat Store, and Paipai, all major O2O channels are popular, ranking top in the best seller list. The following is a preemptive trial reading of the book:

Financing difficulties are the bottleneck for the development of SMEs in China. The vast emerging market countries like China generally have difficulties in financing SMEs and innovation and entrepreneurship in new areas. After years of development, the traditional financing channels have formed a relatively complete system, including strict regulations on credit system, risk assessment, credit products, etc. For small and medium-sized enterprises, these rigid regulations often bring many practical problems such as difficult financing, high cost, high threshold and so on.

The average private financing cost of SMEs in China is about 20%, and some even reach more than 50%. Financing is difficult and expensive, and small and micro enterprises face difficulties that affect their survival and development. There are many reasons for the financing problems of small and micro enterprises. Difficult and expensive financing are two different levels of problems: difficult financing refers to insufficient availability of funds. Financing expensive means that the cost of capital is high, which can mean that the cost of capital is higher than it should be, or that the cost of capital exceeds the affordability of the enterprise. The former is mainly caused by the difficulty in financing, and the latter may also be caused by the high overall level of capital interest rate.

　　 Difficulty in financing small and micro enterprises, innovation and entrepreneurship in new fields is the "new normal"

The distribution of bank credit resources is unbalanced. The traditional credit products of banks cannot meet the needs of enterprises. On the other hand, for security reasons, banks are more willing to focus on large and medium-sized enterprises with large assets and strong profitability. Banks do not pay enough attention to the financing needs of small and micro enterprises, the threshold of credit conditions is set too high, and the institutional products are single.

The threshold of the securities market is too high. At present, the equity financing of small and micro enterprises is still in the initial stage of exploration. The number of small and micro enterprises eligible for equity financing is small, the scale is small, and the financing time for listing is long, the cost is high, the procedures are many, and the control is strict, which makes it difficult for most small and micro enterprises to rely on the capital market for financing.

The financing guarantee service platform is not perfect. China's guarantee industry started late, the credit guarantee system is not perfect, the number and types of guarantee funds are difficult to adapt to and meet the financing needs of small and micro enterprises, and the credit enhancement function and guarantee amplification function of guarantee institutions have not been fully played, leading to financial institutions - small and micro enterprises - guarantee institutions are not well integrated in the financing process of small and micro enterprises.

The bottleneck of self development is the inherent factor leading to the difficulty of financing. First, the management foundation of small and micro enterprises is relatively weak, the property rights are excessively concentrated, the internal decision-making lacks flexibility, and the mechanism is rigid. Second, small and micro enterprises have high operational risks, few physical assets, low technical level and weak wind resistance, which affect their own capital accumulation and credit financing. Third, the poor credit concept and prominent moral hazard of small and micro enterprises have led to the inability of financial institutions and potential investors to accurately judge the operational and financial risks of small and micro enterprises. Fourth, small and micro enterprises themselves lack the necessary collateral, which directly affects the review and issuance of credit for small and micro enterprises by financial institutions.

The government support is insufficient. For a long time, the government has attached great importance to the development of large enterprises and the construction of large projects, ignoring the support and support for small and micro enterprises, especially in the aspects of policy guidance, financial support, and tax incentives. It has not built a better and more platform for small and micro enterprises.

　　 "Internet+crowdfunding": Internet financing mode provides unlimited possibilities

The difficulty of financing for SMEs has always been a historical problem. In recent years, the development of Internet finance has become the biggest opportunity for Internet finance enterprises to serve small and micro enterprises. Internet finance itself serves the traditional financial industry and fills the gap that traditional finance cannot solve. Small and micro enterprises are an important channel to provide more employment opportunities, and their services and employment opportunities in China are disproportionate. The lack of physical outlets in Internet finance has reduced costs to some extent; On the other hand, after data accumulation, small and micro enterprises can be scored and granted credit by automated means. Internet financial enterprises can provide certain services to small and micro enterprises by using Internet technology.

Crowdfunding as a new type of Internet financing The mode is more open than the traditional financing mode, and the commercial value of the project is no longer the only criterion for obtaining funds. As long as the project is popular with the public, the first fund for project startup can be obtained through crowdfunding, and generally the scale of the first financing is not large, providing unlimited possibilities for more people who are engaged in small business or creative work.

　　 Characteristics of crowdfunding mode compared with traditional financing

Big data application and cost reduction Internet crowdfunding can use big data application development after data accumulation to reduce costs, automatically score SMEs' credit, and quickly seize SMEs' financing market with the help of Internet fast online credit, crowdfunding and other models. This brings different profit models and financing channels to Internet financial enterprises and small and medium-sized financing enterprises. For traditional financial institutions, their complicated risk control system and credit reporting model will also be impacted to a certain extent, forcing them to carry out systematic innovation and transformation while ensuring safety.

The threshold is low and the participation is strong. As long as you have ideas and creativity, you can initiate projects. Anyone who is interested in a project can sponsor the project, and these two have nothing to do with identity, status, occupation, age, or gender.

Most of the investors are ordinary people. Most of them are ordinary grassroots people, and only a few are companies, enterprises or venture investors. The project has a variety of crowdfunding directions. For example, the project categories on the domestic roll call website include design, technology, music, film and television, food, comic, publishing, games, photography, etc. The project focuses on creativity. The initiator must first make his/her creativity (design drawings, finished products, planning, etc.) demonstrable before passing the review of the platform, not just a concept or an idea. Creative people who predict market demand can strengthen communication with investors to understand their needs and suggestions for new products, while investors will not be prejudiced against the sponsors because of their background, origin and resources. They are enthusiastic about the sponsors' projects and give them encouragement, criticism and suggestions. The initiator can collect these suggestions and produce a product suitable for most people. Cheap market promotion supporters are the best first group of consumers and loyal supporters. At the same time, they can also drive potential consumers around them, attract another group of fans, and develop and promote a broader market.

　　 New opportunity - break the policy bottleneck and present the backbone of supervision

On November 19, 2014, Premier Li Keqiang presided over the executive meeting of the State Council, which put forward for the first time the idea of "establishing a rapid mechanism for microfinance in the capital market and carrying out pilot equity crowdfunding", and decided to further take strong measures to alleviate the problem of high financing costs of enterprises. In the afternoon of December 18, the Management Measures for Private Equity Crowdfunding (Trial) (Draft for Comments) drafted by the Securities Association of China was released, which defined the legal orientation, business boundaries, platform threshold and other categories of equity crowdfunding, In particular, the investment threshold of investors has been clearly set (personal financial assets shall not be less than 3 million yuan or the average annual income of individuals in the last three years shall not be less than 500000 yuan), and the cumulative number of investors shall not exceed 200. Previously, the regulators further affirmed the role of equity crowdfunding in alleviating the high financing costs of enterprises, bringing another vitality to the equity crowdfunding market. The release of the opinion paper ensured the neutrality of the crowdfunding platform and the positioning of intermediary services, and made clear the difference between the equity crowdfunding platform and the illegal one. But whether the high threshold will turn equity crowdfunding into a giant game and reduce the market vitality. On March 11, the General Office of the State Council of China issued the Guiding Opinions on the Development of Mass Entrepreneurship Space to Promote Mass Innovation and Entrepreneurship (hereinafter referred to as the Guiding Opinions), which pointed out that in order to promote the new trend of mass innovation and improve the venture investment and financing mechanism, the Internet equity crowdfunding pilot will be carried out to enhance the service ability of crowdfunding for mass innovation and entrepreneurship. The implementation of the Internet equity crowdfunding pilot project has received policy support, which may usher in new opportunities and opportunities for domestic crowdfunding.

　　 Crowdfunding "rises with wind and water"

According to China Electronic Commerce According to the monitoring data of the Research Center (100EC. CN), there were 889 global online crowdfunding platforms in 2013, and the industrial scale has grown from 530 million dollars in 2009 to 5.1 billion dollars, up 88.9% from 2012. By the end of June 2014, 1423 domestic crowdfunding platforms had raised funds in the first half of the year, with a total amount of 187910700 yuan; It is predicted that by 2025, the scale of crowdfunding in China will rise significantly, reaching US $460-50 billion, accounting for about 1/6 of the total US $300 billion of crowdfunding in the world, and 1/2 of the total US $90 billion of crowdfunding in developed countries. More and more entrepreneurs began to rely on crowdfunding platforms to raise start-up funds for their projects.

In China, by the end of 2013, the number of small and micro businesses in China had exceeded 55 million, and the credit demand was about 22 trillion yuan, while the national financial institutions only invested 13 trillion yuan in loans to them. At the same time, the number of corporate and individual deposits exceeded 100 trillion yuan. China urgently needs new investment channels, and crowdfunding is a good financing channel.

To raise funds successfully, you need certain skills. Different types of fund-raising platforms are suitable for different products. Whether you intend to establish a fund-raising platform or raise funds on the platform, the current crowdfunding model includes equity based crowdfunding crowd-funding)、 Equity based crowdfunding, reward based crowdfunding crowd-funding)、 And Donate based crowdfunding.

From the above figure, we can see that the number of financing events of equity crowdfunding mode is higher than that of incentive crowdfunding mode, which shows that the development of equity crowdfunding mode in China is growing rapidly and has become one of the principle ways of Internet and Internet enterprise financing, and on the other hand, incentive crowdfunding is still in its infancy in China, with huge development space. According to the monitoring data of China E-Commerce Research Center (100EC. CN), in the first half of 2014, there were 1423 financing events on domestic crowdfunding platforms, with a total amount of about 187910700 yuan raised. There were 430 equity crowdfunding events, and the amount of platform financing was about 155.63 million yuan; 993 incentive crowdfunding events, 108000 investors actually participated, and the platform raised about 32.287 million yuan, accounting for 82.82% and 17.18% respectively.

At present, China's crowdfunding is mainly manifested in the instrumental application of finance to Internet technology. The crowdfunding platform is a platform for providing financing information in the process, and is still in the primary stage of Internet financing development. Crowdfunding is also typical of the bottom of a financing channel.

The development of equity based crowdfunding in China is weak, and only two angel based crowdfunding platforms, Dajiatou and Angelhui, are relatively successful. However, it is believed that after the promulgation of the laws on crowdfunding regulation in China, especially the laws on equity crowdfunding regulation, equity crowdfunding platforms will increase significantly, and the platform model will become more mature, attracting more angel investors.

　　 Problems in the initial stage of crowdfunding development:

Lack of innovation, the project is difficult to impress investors. The biggest reason why crowdfunding failed to develop was that the innovation environment and creativity in China were relatively limited, especially the number of high-quality projects. Only 3% of the projects submitted by the financiers on the crowdfunding website have passed, and 97% will be screened out. Therefore, the domestic crowdfunding industry has a big gap with the United States, Britain, Australia and other European and American countries in terms of innovation or technology content.

People's income is low and investors are scarce. The low level of people's income and low awareness of crowdfunding also have a greater impact on crowdfunding dilemma. Crowdfunding is a kind of financing mode with middle and high levels. It supports crowdfunding. Its return is not real money, but it is more meaningful and valuable, such as spiritual value and the value of making friends. However, due to the small number of white-collar workers in China, the low overall income level, and the lack of awareness of crowdfunding, only a few people are willing to invest in crowdfunding projects, so this road has a long way to go.

It involves illegal fund-raising, which makes people afraid. Crowdfunding is a public oriented fund-raising model. According to relevant domestic laws, it is very easy to be labeled as illegal fund-raising. As soon as the U.S. JOBS Act was introduced, the market immediately experienced explosive growth, liberating productivity in both directions, allowing start-ups to raise funds from individuals, and allowing individual investors to invest in start-ups, which greatly liberated productivity and production relations. But there is no such policy in China at present.

The platform has a high degree of similarity, and many monks have little porridge. Domestic crowdfunding websites are extremely similar. Even though some websites are nominally focused on crowdfunding of a certain type of creativity, they are still similar websites because they do not form unique website experience and product logic under their subcategories. When talking about foreign crowdfunding, I think about kickstarter; When it comes to domestic crowdfunding, there are many different opinions, and none of the websites can win. Entrepreneurs do not know which website to publish their ideas on, and investors do not know which one to look for interesting projects.

　　 "Internet+crowdfunding": the future of crowdfunding in China

The crowdfunding model is the same as the P2P model. As an attempt of Internet financial innovation in recent years, its growth will inevitably lead to a situation of "muddling through the sand", which will inevitably go through a process of great turbulence. Therefore, it is necessary to speed up the research on Internet financial supervision, learn from overseas practices in crowdfunding supervision, implement supervision on investors and financing entities, strict access to crowdfunding platforms, and define regulatory measures.

In China, a number of crowdfunding websites such as crowdfunding websites have developed rapidly, and crowdfunding has become an important field of Internet finance. Compared with the "baby army" like Yu'e Bao and the popularity of P2P online loans, the scale of crowdfunding, the third wave of Internet finance, is still relatively small in China. In the view of some researchers, crowdfunding has a disruptive financing capability, but when this capability can become a reality has become the focus of discussion. Crowdfunding is inherently characterized by helping more young people realize their dreams through crowdfunding. However, the development of the domestic crowdfunding industry still faces various challenges. The development of China's crowdfunding industry should actively seize the opportunity of internationalization.

On July 1, 2014, JD Financial's crowdfunding business "Gather" officially appeared. This is another Internet giant entering the crowdfunding field after Alibaba Entertainment Treasure and Baidu. Baidu's crowdfunding project is once again operated by Baidu Financial Center, which is an early step into the film industry, and has a driving role in driving the development of the domestic cultural industry. Although the "Entertainment Treasure" launched by Alibaba's digital entertainment business group is covered with insurance, its core is crowdfunding. Entertainment Treasure is not strong in personal investment, but it is entertaining, similar to foreign product crowdfunding.

　　 Typical case: JD crowdfunding: "three dads" ignite the "under the sky" air purification market

On October 21, 2014, JD set a new record for the highest amount of crowdfunding: on the 29th day of the launch of the "three dads" dedicated air purifier for children, the amount of crowdfunding exceeded 10 million, becoming JD's first ten million level crowdfunding. Three dads air purifier is an intelligent air purifier focusing on children's air purification market. Dai Saiying, the founder, said that the original intention of manufacturing the product was to add a layer of security to his unborn child.

In September, the three dads also received a round A financing of $10 million from Gao Rong Capital and a quotation resource of $1500 from Focus Media. The success of the three dads is inseparable from the help of the media and capital.

Only two months after the launch of the JD crowdfunding platform, there have been 7 projects raising more than one million yuan, setting a record for the efficiency of domestic crowdfunding platforms. This shows the advantages of JD platform resources and hundred million level consumer traffic. The smart hardware project has been recognized and supported by more and more investors. With the launch of the three dads' "zero particle" smart air purifier project, I believe that more people with dreams will come to JD crowdfunding platform to launch their dreams, and more people will support entrepreneurs with dreams.

The haze weather has ignited the air purification market, and the love for children behind the "three dads" has even touched the hearts of parents. As small household appliances, air purification products have the characteristics of low entry threshold and large market demand, so it is easy to open the market with low cost. The three dads' products built a business model suitable for themselves by using product feelings, adding story color to entrepreneurship, matching the market user view, product view and participation view, and finally won the market.

Equity crowdfunding and equity crowdfunding are two legs of JD crowdfunding. The launch of equity crowdfunding does not mean that equity crowdfunding will be ignored. Equity crowdfunding will expand more projects to popular culture, life aesthetics, and public welfare. More and more people's lives will be affected by JD crowdfunding. Crowdfunding is bound to become an innovative and high-quality lifestyle.

　　 Sing Bar Maisong: Change the traditional KTV drainage mode through equity crowdfunding

Targeting market segments: crowdfunding model has gradually become known to the public, equity crowdfunding platforms and equity crowdfunding projects are increasing, and large Internet enterprises are also eager to try. A few days ago, the equity crowdfunding platform "crowdfunding" announced its official operation. Compared with the numerous crowdfunding websites in the market, crowdfunding only focuses on the field of eating, drinking, and having fun in the same city, which is closely related to people's lives. KTV still has a strong demand in an environment where public consumption is banned, rent rises, and entertainment choices are more. In the future, KTV groups will be more segmented in terms of age, identity and occupation, focusing on 18-35 year old office workers and students, and still have a large market.

　　 O2O Mode service: One of the ways for KTV to survive in the Internet era is to transform the traditional KTV's store opening mode, survival form, and dividend sharing rules, while consolidating the mobile Internet end users, and even allowing these users to go offline to drive offline KTV consumption from online. The "debut" of crowdfunding guests will cooperate with Singing Bar. On March 5, Sing Bar's Maisong ktv Chongwen store will be launched into crowdfunding, with 46% shares to be sold and 3 million yuan to be raised. In order to allow more investors to participate, the amount of crowdfunding for each investor is set between 5000 yuan and 50000 yuan.

Cross border cooperation prospect: Singing Bar has 220 million registered users. At present, three Singing Bar Myzong KTVs have been opened, and the passenger flow has been considerable without diversion. According to the CEO plan of Sing Bar, if online users are guided and converted to offline stores for consumption, the development prospect of Sing Bar ktv will be very promising.