Crowdfunding is undoubtedly a rapidly growing part of the social business movement, with billions invested worldwide in a whole range of projects. The Czech Republic and other central-eastern European countries are not perhaps what you would imaging as a thriving place for crowdfunding, but a recent report by the Prague branch of the Aspen Institute reveals otherwise.
The report was looking at the Visegrad (V4) countries in particular, which consists of the Czech Republic, Hungary, Poland and Slovakia. The report revealed that over the last three years, something like 24 million crown (roughly £700,000) had been raised through various crowdfunding projects in the Czech Republic.
Of course, this sum isn’t huge by any stretch, with the report suggesting that many international looking enterprises use global platforms for their crowdfunding, hence the small sum generated by purely native platforms. For instance, the Czech based game Kingdom Come raised over £1 million via a recent KickStarter campaign, so dwarfed the domestic efforts on its own.
The Czech’s are however leading the way when compared to their peers in the V4. Most of the native crowdfunding efforts in the country have focused on arts and community based projects. Most of the technology focused endeavours have tended to use global platforms such as Kickstarter and Indiegogo.
The report highlights the important role the operational environment plays in establishing crowd based platforms. For instance, it suggests that crowdfunding has struggled to develop in Hungary due to the relatively low levels of trust in public affairs.
The burgeoning market in Czech still requires some significant support however for it to reach anything like the levels we see in Britain and America. It’s with that in mind that the Aspen Institute produced a how to manual alongside the report for anyone looking to build a crowdfunding campaign.
The report reveals that there are a number of legal issues surrounding financing commercial projects in Czech currently.
“Now we are getting into the more complicated field of equity funding where you offer funders equity or profit. That’s quite a tricky field when it comes to the Czech legal environment because with it come many legal difficulties, and there have not been any major projects here,” they say.
Hopefully, as the industry grows, the country will be encouraged to undertake many of the same reforms that have been undertaken in other countries over the past few years.