Have you always wanted to carry out a project but couldn’t find the financing? Or on the contrary, do you have savings but without knowing where to invest in the collective interest? Crowdfunding is the solution in both cases ! Project initiators or altruistic investors, alternative financing meets your needs and respects your values. With its rapid growth, crowdfunding has now become indispensable, even in Monaco! Close-up on its operation and main actors. 

Crowdfunding? Another way of saying participatory financing

Crowdfunding isn’t the easiest word to pronounce for people who aren’t native English-speakers. This is the English word used to describe participatory financing.

This alternative financing method is attracting growing numbers of followers, both project initiators and investors. In France, participatory financing or crowdfunding already has more than 20 platforms that are promoting the social and solidarity-based economy. Even communities can use this type of financing.

Whatever the domain, crowdfunding is the new way to finance a project. The figures given by KPMG and the Financement participatif France (FPF) association speak for themselves: crowdfunding is confirming its growth, with +20% funds collected in 2018. 

> More on the Crowdfunding barometer in France

Monaco isn’t escaping the trend: the first crowdfunding platform was set up in 2015 with the authorisation and endorsement of the Government of the Principality. Since then, it has been a great success within Monaco and well beyond its borders! And that’s quite justified, since one of its strong points is its observance of crowdfunding values, notably with a philanthropic charter.

This platform works with project initiators and financial backers, providing them with a quality service. It safeguards investments by choosing viable projects through a selection process, while guiding project initiators during their campaign to bring together as many people as possible around their initiatives.

The crowdfunding principle

The principle of crowdfunding or participatory financing is simple: bringing together financial backers (generally individuals) and project initiators in order to give concrete shape to their projects. It is thus a question of financing a project by the greatest number of people : however small, each amount counts!

Initial contacts are established through online crowdfunding platforms. These are known as “Fintech BtoBtoC” (Business to Business to Consumer). Project initiators describe their projects and the financing that they need to bring them to reality. Contributors choose to finance them collectively by paying the amount they wish in support of the projects.

This fundraising tool is often used as a supplement to other more traditional financing methods, such as bank loans or micro-credits.

Crowdfunding values 

Contributors opting for crowdfunding or alternative financing don’t do it by accident. It’s first and foremost a human and collective adventure. The process of investing in a project by crowdfunding can go well beyond financial aspects. Indeed, it’s a direct commitment made with a project initiator. Many people also see it as an opportunity for high returns that can’t be found within the classical financial market.

Whether from the viewpoint of project initiators or investors, crowdfunding is a means for expressing true human values:

  • – Proximity. 

Project initiators start with their circle of friends and family, with the circle getting bigger as the crowdfunding campaign advances.

Investors can support a local project, or something special on the other side of the world.

  • Involvement.

Project initiators have to make every effort to convince. After all, the money doesn’t grow on trees! They have to bring together a large community to support the project, morally and financially.

Investors actively involve themselves by financing a project that they like and have chosen.


  • Sharing and solidarity. 

Project initiators and financial backers are on the same wavelength: an altruistic attention to others is at the heart of their efforts.

  • – Disintermediation.

Crowdfunding is part of a strong trend in all domains: operating in a short circuit or even directly, and avoiding intermediaries as much as possible. This is true in distribution (direct sales at the farm) and in financing!

But it’s important to find the right crowdfunding platform that also shares these values! This is the case of the only Monaco-based crowdfunding platform. Fully aligned with the values of the Principality, HRH Prince Albert of Monaco stresses the importance for the general interest of this new and fully transparent type of financing. As such, project initiators and contributors have a safe intermediary to put them into contact, via a reliable and committed platform.

So crowdfunding is for whom? 

A crowdfunding platform brings together project initiators and investors. But who exactly are they? Could you promote a project, or even finance one?

Project initiators that use crowdfunding

In terms of crowdfunding, all types of projects can be proposed. However, they have to be “real” projects, with a collective, humanitarian or artistic scope, and not just an individual desire or a vague idea! So don’t bet on crowdfunding if you want to finance a personal project such as buying yourself a house!

Project initiators include the creators of start-ups, entrepreneurs, associations, and directors of small companies (SME). They have insufficient funds to create, take over or develop a business and/or are looking for alternative financing that provides them with visibility in addition to funds.

They turn to crowdfunding in order to:

  • Entirely finance their projects that are considered too “outside of the box” or “special” by traditional financing establishments.
  • Obtain additional financing.
  • Create a community of potential users or customers in order to test their projects on the market.

Investors and crowdfunding methods  

Projects can be financed via crowdfunding in several ways:

  • a gift, with or without some consideration,
  • a loan,
  • an investment.

Crowdfunding platforms generally offer several financing methods:

Gifts: reward-based crowdfunding

This is the most widely-known type of crowdfunding.

Investors make:

  • A gift with nothing in return. They’re keen on the project and absolutely wish to support it. They believe in the product and want to give it their backing.
  • A gift with some consideration. The symbolic reward might be a pen with the company logo, a magnet…
  • A pre-order. They “buy” a product or service that will be marketed or proposed once the entire sum has been gathered from multiple donors.

This type of crowdfunding is perfect for testing how the market will receive a product or service. Another benefit of gifts is that it increases the project initiator’s own funds, and helps to create leverage for other financing (bank loans, subsidies…).

Loans: Crowdlending

Investors provide crowdlending or a participatory loan with or without interest. Such loans are used to finance expenses (liquidity needs) that can’t be covered by banking establishments.

Investments: Crowdequity

This involves an equity investment in the company, with different statuses:

  • A capital investment (remunerated in the form of dividends or capital gains).
  • A bond-based investment (remunerated via interest).
  • An investment with royalties (known as “royalties crowdfunding”) (commissions on the turnover).

Crowdfunding of this type is primarily used to support an innovative project, or one that has been rejected by traditional financial backers. Investors may be entitled to tax benefits.

Would you like to give meaning to your investment? Think about crowdfunding! Are you looking for financing for your humanitarian, ecological or artistic project? Think about crowdfunding! In Monaco, like elsewhere, the future is bright for crowdfunding, notably thanks to a platform that is devoted to successful projects and investments. Let’s work together to make the world a better place for all.