Crowdfunding, or so-called social funding, is a modern method of raising money for an investment using an online platform tool such as Kickstarter. In practice, the investor asks members of the online community (donors) for financial support in exchange, for example, for shares or stocks in a flagship project.
The value of crowdfunding is the international nature of the business initiative’s reach, provided that the business initiative is presented in an accessible and transparent manner to a wide audience.
Donors are not obliged to fund the project in a regular and predetermined manner, and all transactions are done on a voluntary basis. Most start-up developers use an external investor.
An example of a real estate crowdfunding model used for a development venture is investment or equity crowdfunding, where donors receive shares in a construction project company in exchange for financial support (raising capital from a dispersed group of small investors).
Operating companies for real estate crowdfunding are capital companies (limited liability company, joint-stock company, simple joint-stock company) or partnerships with elements of capital regulation (limited joint-stock partnership), of which the simple joint-stock company is the optimal solution due
to the flexibility of handling and selling shares.
The developer, as an operating entity and having the relevant know-how to make a successful investment, is the beneficiary of additional profit through, for example, being a holder of preference shares or stock options.
The basic normative governing crowdfunding are:
(i) Law of 7 July 2022 on crowdfunding for economic ventures and assistance to borrowers (Journal of Laws 2022, item 1488),
(ii) Regulation (EU) 2020/1503 of the European Parliament and of the Council of 7 October 2020 on European providers of crowdfunding services for business ventures and amending Regulation (EU) 2017/1129 and Directive (EU) 2019/1937.
20 January 2023.
