Equity Crowdfunding in the Eurasian Economic Union (EAEU)

• Main Authors: A. S. Shaghikyan, H. N. Hayrapetyan
• Format: Article
• Language: Russian
• Published: Government of the Russian Federation, Financial University 2020-06-01
• Series: Финансы: теория и практика
• Subjects: finance technologies; equity crowdfunding; crowdinvesting; eaeu; early stage financing; raising capital; venture capital; private equity; investors; crowdfunding platforms
• Online Access: https://financetp.fa.ru/jour/article/view/1007

The aim of this article is to provide a comprehensive research and analysis about fundraising through equity crowdfunding or crowdinvesting compared to venture capital and other forms of equity financing in the Eurasian Economic Union member countries. The relevance of the research is conditioned with the fact that equity crowdfunding is one of the fastest growing capital raising platforms and has become a popular financing option for start-ups and early-stage companies. Analyzing generally accepted methods for evaluating early-stage companies, the authors propose to use the venture capital method combined with scenario analysis for determining the value of companies in order to raise funds on equity crowdfunding platforms. The statistical data of the EAEU countries were researched on macroeconomic development, stock markets, fintech, etc. This market is expected to grow year by year, but results show that for now it is still underdeveloped in the Eurasian Economic Union member states. The conclusion is that several regulatory and institutional reforms can enable the growth of equity crowdfunding, thereby diversifying potential sources of equity financing for start-ups and early-stage companies. The suggested approach can be applied by regulators.