How crowdfunding in Malta thrived through one of the toughest years of our generation 2020: the year that will go down in history as the year of the COVID-19 pandemic, with all the uncertainty and challenges that it brought with it. Practically everyone felt the pinch somehow, including those in the world of crowdfunding. Here’s how ZAAR Crowdfunding helped to keep Malta’s crowdfunding community successful throughout this monumental year.
ZAAR Crowdfunding for the entrepreneurs
Crowdfunding, by definition, offers a way to find alternative funding for a project, cause or idea, bypassing the more traditional financial channels such as bank loans or angel investors. It’s all about giving the power back to the crowd, as well as to the people behind the ideas. In fact, ZAAR Crowdfunding was created by the Foundation for the Promotion of Entrepreneurial Initiatives (FPEI) – a collaboration set up between the Malta Business Bureau (MBB) and the University of Malta – with this concept in mind. The ZAAR Crowdfunding platform exists to promote and support even the smallest entrepreneurial ideas to help them reach their goals. So, when campaigners on the platform told us they were worried that people might not contribute during 2020 due to the situation, we stepped in with different measures to help them, including waiving our fees.
Despite the hardships, the success rate of projects hosted on the platform in 2020 is still impressive, when compared to previous years.
Other donation/reward-based platforms worldwide tend to average only around a 53 per cent success rate annually, pandemic or not. But ZAAR? In 2018 we registered an 80
per cent success rate. In 2019, this went up to 82 per cent. And in 2020, we stayed at 82 per cent.
Although the success rate and the number of the online projects hosted on the ZAAR platform remained high (averaging 28 projects per year over the last three years), the
amount of money these projects raised in 2020 took a slight dip in connection with the events of the year. While in 2018 and 2019 more than €150,000 and €155,000 was raised through the platform respectively, in 2020 this figure hit just over €80,000.
Nevertheless, 2020 was still a busy year at ZAAR. Here’s what we were up to:
- Supporting projects
We received over 140 project leads in 2020, of which 26 translated into published projects on the platform. Meanwhile, we increased promotion of campaigns through
boosted marketing initiatives, social media and newsletters.
- EU Crowdfunding License
The European Commission finalised the text for an EU-wide License for crowdfunding platforms in November 2020. ZAAR is working with the national authorities to prepare for the new regulations that are set to come into force in November 2021.
- The Three Questions Model of Developing Social Entrepreneurs (T3QM) project
The FPEI concluded its work on this project, which is funded by the Erasmus+ programme together with five European partners. The project explored the innovative
‘three questions’ methodology that is proven to create jobs and develop both soft and hard social entrepreneurial skills.
- The CORAL programme
Another Erasmus+ programme, CORAL is a collaboration between the partners dealing with the EU Commission’s Entrecomp Entrepreneurial Competency framework. We have successfully completed the research phase and begun implementing the self-assessment tool for young and new entrepreneurs to test their skills and knowledge, as well as various training materials.
- New Projects
Two of our project applications submitted in 2020 have been approved for 2021. The first, with the Arts Council Malta, will implement various activities to enhance the entrepreneurial mindset locally. An EU project led by the European Crowdfunding Network (ECN) – of which ZAAR is a full member – will meanwhile raise awareness of crowdfunding in disadvantaged groups in the community.
- ZAAR Clinics
The ZAAR Clinics sessions we organised served as a think-tank where interested individuals could learn more about crowdfunding and share ideas.
- ZAAR Investor Club
The ZAAR Investor Club is in the process of being set up, following a survey study carried out by the FPEI in 2019 to establish what would make investors consider
investing in start-ups.
- Supporting related entities
In 2020, ZAAR’s manager Matthew Caruana was a Mentor of the Company Programme at the JAYE Malta Foundation; was the Country Patron at the EU Commissions Fintech and Alternative Finance workshop; and once again shared crowdfunding Insights at the ‘Women Mean Business’ conference, as part of the Malta SME Week by the Ministry for the Economy,
Investment and Small Business (MEIB).
- Equity-based crowdfunding
ZAAR’s work towards becoming an investment-based platform also carried on through 2020. We continued our discussions with the MFSA following the publication of their guidelines and about the possibility of collaboration through the MFSA innovation hub.
ECN working groups
At a European level, we continue to be involved in two working groups with the ECN that deal with investment-based crowdfunding and blockchain.
Through 2020 and into the future, ZAAR’s team is committed to supporting everyone in the crowdfunding community with expertise, experience and dedication.