It is shown that more than half of businesses that have succeeded in securities-type crowd funding in 2018 obtained funds from Wadiz. ‘The rich get richer’ phenomenon is becoming more serious within crowd funding market despite improvement in relevant systems.
According to Korea Securities Depository’s (KSD) CrowdNet, 109 businesses out of 191 businesses that have succeeded in crow funding application obtained funds from Wadiz. $17.8 million (20.2 billion KRW) out of $28.5 million (32.3 billion KRW) funding application amount was taken place from Wadiz platform.
Other crowd funding businesses did not come close to Wadiz. Open Trade, Crowdy, and OhMyCompany succeeded in 21, 14, and 11 cases respectively.
Performance of stock firms specialized in small and medium companies was vastly low compared to that of crowd funding businesses. IBK Investment & Securities had the best result by succeeding in 9 cases of applications.
Korea Asset Investment Securities and KTB Investment & Securities succeeded in 8 and 6 cases respectively. Eugene Investment & Securities and Woori Investment Bank succeeded in 4 and 2 cases respectively. IanRoad and Funding4U succeeded in 5 cases and 1 case respectively.
Although Financial Services Commission (FSC) increased crowd funding limit through revision of relevant laws on the 15th of last month, Wadiz was the only one that has benefited from such revision. Actually, after system was improved, two companies that opened applications through Wadiz are having their best performance ever.
Green Plugged, which started funding on the 16th, achieved $706,000 (800 million KRW) in just one day from starting its funding. Doomoolmori, which developed a robo-advisor, has raised more than $884,000 (1 million KRW) as of the 22nd. It is looking into increasing amount of its procurement up to $1.33 million (1.5 billion KRW) since there is enough time until the 14th of February, which is the final date for subscription.
Industries point to scale of crowd funding market as the main reason why Wadiz is practically the only one to succeed in crowd funding market.
“Since participating businesses within crowd funding market are limited, there is a tendency of focusing on products supplied by single business rather than looking for products from various platforms.” said a representative for the industry. “Since relevant systems are improved, crowd funding businesses will look for promising products that can compete with products from Wadiz.”
“South Korea’s securities-type crowd funding market has been showing steady growth and has been a successful source of procurement of new funds for starting businesses.” said Park Hye-jin, who is a researcher from Korea Capital Market Institute. “For crowd funding market to grow continuously and to expand foundation for supplying stable funds, industries need to pay careful attention to a possibility of affecting investors with uneven information.”
Staff Reporter Ryu, Geunil | ryuryu@etnews.com