Abstract

Purpose – Paper aims is to describe, analyze and to increase the knowledge of the emerging crowdfunding phenomenon. This can be defined as the practice of funding a project or venture by raising a lot of small quantities of money from a huge number of people. Even though the number of academic studies has been increasing, the coverage of the population is relatively weak and not well understood by entrepreneurs and individual investors.

Design/Methodology/Findings – The research can be classified as an exploratory research. It focuses on how the crowdfunding works. The research addresses the following research questions: What is crodwfunding? Which are the main characteristics of this phenomenon? Wihic are the principal strengths and the main weaknesses of crowdfunding? The findings expose purposes, characteristics, roles and tasks, and investment size of crowd-funding activity.

Practical implications – The findings have implications for service managers interested in managing crowd-funding initiatives and to improve the activity of the consumers.

Originality/value – The paper analyses a new emergent phenomenon. It aims to define the user/costuemr’s role from co-creation to investment.

Introduction

The availability of money is indispensable for the functioning of an enterprise. The finance department is the corporate function which deals the phase of funding and as part of the management cycle has as its object the dynamics of capital. The object of the finance function can be traced back to three questions:

– What is the total volume of capital means that firm must commit?

– What specific investments the firm has to make?

– Which are the sources where capital must be obtained?

The lack of capital is ne of the most important obstacle to growth that can’t be always satisfied by recourses of othe people (family and friends) or financial operators. The management of the capital factor, since the acquisition to the time of its use, will require a decision-making focused on quantitatively and qualitatively capital resources observed both in their origin – sources – and in their destination – uses. Funds can differ in the different stages in a company’s life cycle (Figure 1).