According to fonbulucu.com, a group that has rolled up its sleeves to develop Turkey's crowdfunding market, as the development of alternative financial resources in recent years came together with digital interactions created by the pandemic in 2020, the movement area of the sector expanded.
There are different programs that startups in need of crowdfunding turn to for resources. Each of the product-oriented, social enterprise-focused, service-oriented businesses chooses the appropriate platform for itself, which makes it easier to find resources and enables entrepreneurs to identify alternative resources during the pandemic. Similarly in Turkey, it is only a matter of time before the Capital Markets Board (SPK) issues new permits and crowdfunding alternatives become available.
Today, there are more than 2,000 crowdfunding platforms in the world, 10% of which are based in the United States. Some 300,000 new jobs were created from campaigns that were funded in 2019. The effect of this system on employment and production has been enormous. A country that grows its venture ecosystem by even 1% could add billions of dollars to its economy and the main system that supports it is crowdfunding.
With the addition of the share-based crowdfunding system in the first quarter of 2021, it seems that entrepreneurs and investors will come together in large volumes. In 2020, fonbulucu.com received funding requests approaching TL 200 million ($28.5 million) as 1,905 new entrepreneurs and venture companies and 532 new investors registered on the system, resulting in 1,005 campaign requests being created. Following the SPK licensing, these startups will be published and Turkey will have a brand new funding and investment model.
The share-based crowdfunding model offers startups the opportunity to receive investments in return for their shares without being listed on the stock exchange. It offers unique opportunities, especially for startups in their early stages and just beginning to scale. Investors of all sizes, from "home-type investors" who want to capitalize on their savings, to larger institutional investors, have the chance to invest in the unicorns of the future by taking a share of innovative ideas and startups.
While 2020 divided entrepreneurs into two groups – those who turned the pandemic into an opportunity and those who could not survive the crisis – the interest in startups engaged in e-commerce, innovative solutions for COVID-19, material and service production, gaming and digitalization has increased. The crisis revealed the prominence of online platforms in the search for investments while demand for sectors that require contact, those that need people to meet physically, dropped. Science and technology took the lead in the most popular areas – namely health, design, environment, social responsibility and education – becoming the favorite sectors for investors. Fonbulucu.com data also revealed that startups in the game industry, a shining star in recent years, and production technologies in the agricultural field will be more prominent in the coming period and that the activities of Generation Z and female entrepreneurs will increase.
The founder and general manager of fonbulucu.com, Hakan Yıldız, stated that his company beta-launched in 2017. As a crowdfunding platform, they received their first TL 6 million in funding through a tour attended by 18 corporate and individual investors before obtaining the SPK license in the third quarter of 2020. “The system was founded in 2016 to revive the ancient tradition of Anatolia on online platforms, to develop the entrepreneurship and investment ecosystem in Turkey and to spread the capital to the base," Yıldız stated.
"While fonbulucu.com continues its reward and donation-based crowdfunding activities, we have completed our preparations to offer 'Share-Based Crowdfunding' services. We have successfully completed software integrations with the Central Registry Agency, E-Government and Takasbank. On Aug. 14, 2020, we fulfilled all the requirements and applied for an operating permit from the SPK. As fonbulucu.com, we aim to reach a transaction volume of TL 1 billion and 1 million registered members by 2023 when we look at our medium-term targets," he said.
It is very important that institutions and individuals that invest in startup crowdfunding investments conduct independent audits.
Startups should pay attention to the expert evaluation of the product and service they offer and be transparent about the founder, the team and their competencies.
They should definitely look at both positive and negative evaluations about market potential, not the ventures to be invested in.
Indiegogo: The best platform in general ranking, especially in products and services
SeedInvest Technology: The best for entrepreneurs
Mightycause: The best for nongovernmental organizations
StartEngine: The best for investment
GoFundMe: The best for individuals
Patreon: The best for creative professionals
Source: Investopedia 2021
The START program for advanced technology startups, which aims to develop early-stage technology businesses from various categories, kicked off with six months of training support for 28 companies.
The program, implemented with the cooperation of Facebook and Hello Tomorrow Turkey, held an online event for the 28 startups. In his keynote speech at the event, Scientific and Technological Research Council of Turkey (TÜBITAK) Chairperson Hasan Mandal stated that support approaches are on the platforms of large-scale projects, whether in the process of technology development or product development.
Mandal said the START program offers training and mentoring services to technology entrepreneurs operating in the fields of smart cities, digital health, educational technologies, agricultural technologies, and data and cybersecurity and contributes to other important opportunities in the co-entrepreneurship ecosystem.
"Congratulations to the 28 companies that participated in the program. The programs that each of you are in are truly the technologies of the future and the solution-oriented approaches you need," he added.
Apart from 22 startups that took the stage at the event, three experienced investors who invested in advanced technology startups were also in attendance. ScaleX Ventures managing partner Dilek Dayınlarlı, Diffusion Capital Partners' Alper Karagöz and Sankonline fund manager Esranur Kaygın discussed the future of the sectors in the START program application categories, investment situations and investment criteria in these sectors.
The START program will provide training and one-on-one mentoring opportunities from international experts in various fields such as marketing, R&D and innovation throughout the program to startups that qualify to participate in the program.
In addition, entrepreneurs participating in the program will have the chance to join the Deep Tech Pioneers community established for the best high-tech startups from around the world. Sectoral reports will be presented at the end of the program, which includes predictions on technology trends within the scope of the five sectors in the program, and scientific and technology-oriented research of breakthrough innovations in Turkey and the world.
Facebook Turkey Public Policy Department Head Çağatay Pekyörür said about the START program: "Empowering local startups with the power they need to build communities is one of our top priorities. We will strengthen the entrepreneurship ecosystem in our country to solve meaningful problems by providing support to entrepreneurs for their education and growth through this program we have implemented in this direction.”
Hello Tomorrow Turkey founder and Chairperson Timur Topalgökçeli also said that the Turkish entrepreneurship ecosystem is among the fastest-growing in the world. "With START, we designed a special program for the needs of our entrepreneurs who have chosen this difficult path, and we have joined forces of two global institutions specialized in this field," Topalgökçeli continued. "We created an academy based on our own research and data. In this direction, we believe that we, as entrepreneurs, set the limits of our horizons."
