TITLE:
Crowdfunding: Genesis and Comprehensive Review of Its State in Africa
AUTHORS:
Oloutchègoun Josias Lawrence Adjakou
KEYWORDS:
Crowdfunding, Entrepreneurship, Funding, Equity, Debt, FinTech, Equity Gap, Africa, Economic Development, Developing Countries
JOURNAL NAME:
Open Journal of Business and Management,
Vol.9 No.2,
March
16,
2021
ABSTRACT: In developing countries, the topic of crowdfunding is still in its
infancy because Europe; Asia and North America have monopolized almost all the
researchers’ attention. Nevertheless, the number of scholars stressing the fact
that investigations should be conducted on the economic impact of crowdfunding
in developing countries where financial systems are still struggling is incredibly increasing. But before getting to that point, as Gajda and Walton
stated, “An analysis of primary and secondary data; in-depth assessment of live
projects and statistical analysis could provide more insight (…) how to make
crowdfunding more accessible to entrepreneurs in the developing world” (Gajda & Walton, 2013: p. iii). Drawing on this and the fact that none of the extant literature about
crowdfunding in Africa has provided statistical assessment of existing
platforms on the continent; how much crowdfunding has been adopted and
sustainably implemented across various region on the continent, this paper’s
main goal is to depict and describe the current situation of crowdfunding in Africa. Known as proven and accepted methods
used for growing topics in the field of entrepreneurship, this paper used
exploratory and descriptive methods. This paper provides everyone in
need of clear understanding of crowdfunding’s origin; how it evolved; its level
of penetration and use in Africa, with the necessary information. The study
came to conclude that in West and North Africa only 22% and 33% of the
platforms created in the span of 2012 to 2020 are still operating. East Africa
and South Africa are doing far better as respectively 70% and 55% of their
crowdfunding platforms are still operating. The study also found that French
Speaking countries struggle a lot in implementing and sustaining crowdfunding platform.
West Africa performs very poorly as rarely the projects listed on the scarce
platforms still operating manage to gather more than 2% of their funding goals.
The study also came to the conclusion that by May 2020, 64% of the crowdfunding
operating in Africa are foreign based.