Equity crowdfunding: does it impact start-up valuation?

Le financement par crowdfunding. Quelles spécificités pour l'évaluation des entreprises ?

Véronique Bessière and Eric Stephany
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Eric Stephany: MRM - Montpellier Research in Management - UM1 - Université Montpellier 1 - UPVM - Université Paul-Valéry - Montpellier 3 - UM2 - Université Montpellier 2 - Sciences et Techniques - UPVD - Université de Perpignan Via Domitia - Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School

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Abstract: Crowdfunding plays an increasing role for seed financing. Compared to traditional ways of fundraising, it introduces two new stakeholders: the platform and the crowd. Both are involved in the selection and the valuation of entrepreneurial projects. This article examines their role and the ensuing valuation process. We discuss the legitimacy of the crowd to assess a financial valuation. Our analysis underlines two kinds of phenomenon. First, the valuation process becomes less and less financial and more affect-driven. We observe an evolution towards a "definancialization" of valuation. Second, the governance of startups is also evolving compared to the one exerted in traditional context in particular by business angels.

Date: 2014
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Published in Revue Française de Gestion, 2014, 5 (242), pp.149-161. ⟨10.3166/rfg.242.149-161⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02015918

DOI: 10.3166/rfg.242.149-161

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