Record-breaking campaigns on both of the world’s leading rewards-based platforms closed on the very same day last week. The Coolest CoolerKickstarter campaign romped its way to raising around $13m, and Stone Brewing Company smashed Indiegogo’s record with a $2.5m raise.
To give some perspective, Wellesley & Co. recently closed the largest peer-to-peer loan on record – a £10.8m property loan. In doing so Wellesley actually bested its own record – which previously stood at £8.3m. Wellesley aside – the largest peer-to-peer loan ever completed is a £4.12m deal by secured platform LendInvest. It’s not wholly clear what the record raise for an equity crowdfunding campaign is – but it stands somewhere around the £2m mark.
There’s a common perception that the rewards-based crowdfunding space generally deals in pretty trifling numbers. And to be fair there is a vast multitude of £100-£1,000 projects out there. But this pair of records serves as a reminder that a campaign with traction – particularly when listed on one of the major platforms – can take off in a way that is perhaps unique to rewards-based projects.
Because they’re not advertising any kind of financial return whatsoever, rewards-based platforms are free from the regulatory shackles that prevent platforms like Crowdcube and Seedrs from drumming up a social media-led frenzy over individual projects. Rewards campaigns, even of a completely absurd nature, have a unique capacity within the alternative finance world to “go viral” – and thus attract unprecedented amounts of funding.