Crowdfunding to finance local business ideas and projects in Malta
Malta Business Bureau and University of Malta to launch Malta’s first Crowdfunding Platform
The University of Malta and the Malta Business Bureau signed a collaboration agreement to work on making crowdfunding a reality for hundreds of individuals and entrepreneurs that have brilliant ideas for innovative projects and businesses, but lack the finances to make it a reality.
Crowdfunding is a fast growing alternative means to raise funding for projects or ventures by raising many small amounts of money from a large number of people.
Explaining MBB’s interest in this area, president Mario Spiteri said that the Malta Business Bureau has been keen on introducing crowdfunding to Malta ever since it was recommended in a report it published on market gaps in access to finance in Malta.
“The outcome of that report clearly showed that the Maltese credit market needs a diversification of financial instruments – particularly for start-ups – because this part of the business lifecycle is not being catered for by the more established credit institutions. Furthermore the traditional instruments they provide such as bank loans and overdrafts are not necessarily the appropriate financing they should be after at this stage of their development,” Spiteri said.
University Rector Juanito Camilleri said that the University had been following the development of crowdfunding internationally and understood the potential it has to finance businesses at an early stage, when they require it the most.
“I am excited to see this project come to fruition as it will complement the University’s efforts to encourage entrepreneurship among students, following the successes of the Masters in Knowledge-based Entrepreneurship and the TAKEOFF Business Incubator, launched recently. Crowdfunding will surely boost innovation and entrepreneurship, particularly if the local as well as international community are encouraged to participate actively,” Camilleri said.
Crowdfunding platforms are mechanisms that take the form of a website that allows would-be sponsors to make offers to funders and help the two parties interact. Entrepreneurs and businesses can utilise the platform to promote their ideas, raise funds, conduct market research on their product, and interact with potential customers.
In addition to its yearly contribution towards the TAKEOFF Seed Fund Awards, the Ministry for the Economy, Investment, and Small Business saw the potential in introducing crowdfunding to Malta, and will be partially sponsoring the setting-up and running of the platform in its early stages.