Providing a Business Model of Crowdfunding in Iran

Abstract

The most important support for knowledge-based start-up businesses is their financing, as the most important challenge of those businesses lies in the financing stage. With the advent of Web 2 and social networks, crowd funding has risen as the latest method of external financing. So far, many exploratory empirical studies have examined various aspects of this method mostly based on the features of advanced countries and superior crowd funding platforms in the world. Hence, it is necessary to study crowd funding and to develop the method in Iran too. This paper aims to provide propositions, crowd funding business models, and a typology of actors of this method in Iran by analyzing the exploratory empirical data obtained from active crowd funding platforms in the country. The analysis is conducted of the empirical data of five active platforms and 307 campaigns. The results show that the internal platforms, although recently launched, have been able to attract 24771 funders and to raise approximately 20,379,773,066 Rials. The success rate of crowd funding in Iran is 54 percent, and platforms with reward and donation models have the highest success rates. Since this paper is an exploratory study based on empirical data, only nine propositions have been made.

Keywords

• crowd funding
• web 2.0
• exploratory empirical study
• business model