ABC-CLIO

Peer-to-Peer Lending and Equity Crowdfunding

A Guide to the New Capital Markets for Job Creators, Investors, and Entrepreneurs

by Kim Wales
Foreword by Garry B. Crowder

 

Public-private partnerships can help meet the capital needs of American small- to medium-sized businesses and investors. They can also foster financial inclusion and economic growth while reducing income inequality.

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Cover image for Peer-to-Peer Lending and Equity Crowdfunding

December 2017

Praeger

Pages 272
Volumes 1
Size 6 1/8x9 1/4
Topics Business/Finance, Investments and Banking
  Economics/Policy

Written by an industry pioneer who has hands-on experience in the brave new world of peer-to-peer lending and equity crowdfunding, this book serves as a resource for investors and entrepreneurs alike and investigates how these alternative mechanisms will increase the financial and operational capacity of borrowers, lenders, buyers, and sellers in the private markets.

More than 60 governments across the globe have established financial inclusion as a policy priority and are vying for access to and use of financial services by households and firms to boost economic growth. A thought leader on securities-based crowdfunding, author Kim Wales explores how women and the millennial generation, the world's largest groups of people, can influence "crowd" direct investment, economic freedom, and economic growth. The book provides building blocks to instruct investors and entrepreneurs about how to leverage social networks and supplies tools to help retail investors—"the crowd"—to understand the language, risks, and rewards of this type of investment.

Providing an indispensable resource for investors and entrepreneurs, Peer-to-Peer Lending and Equity Crowdfunding summarizes past theory as well as current schools of thought related to capital formation and economic growth, explains why creating a secondary market for private placement offerings is essential to stimulating market liquidity, and documents how public-private partnerships using digital finance will enhance financial inclusion and positively impact investing. The book not only describes how crowdfunding works but also explains investment approaches, secondary markets, governance and compliance, transparency, and risk models that are necessary for investors to make informed decisions.

Features

  • Describes the inherent value in democratization of capital and financial inclusion using peer-to-peer credit and equity crowdfunding that can assist private investors, banks, small businesses, and pension fund managers with market participation
  • Documents the necessity for fostering transparency, enhancing risk management, and establishing a secondary market to increase distribution and liquidity
  • Explains how to raise capital, invest, and make a social justice impact using digital finance
  • Highlights how social media connections influence the capital-raising process
Author Info

Kim Wales is the founder and chief executive officer of CrowdBureau®, LLC and Wales Capital, LLC. She has advised and influenced decision making through recommendations to the Securities and Exchange Commission, Financial Industry Regulatory Authority (FINRA), and numerous state and federal government agencies as related to equity- and debt-based crowdfunding. Wales is adjunct professor in economics at the City College of New York (CUNY). Wales is a member of the Zahn Center Board of Advisors; a Board Member of The City College Center for the Arts; a Board Member of the City College Fund; a member of the Heritage Foundation Securities Regulation Working Group; and an Executive Board Member of the Crowdfund Intermediary Regulatory Advocates (CFIRA).

Table of Contents

Foreword by Garry B. Crowder

Preface

Acknowledgments

Chapter 1
Reregulating and Deregulating theGlobal Capital Markets

Chapter 2
Regulatory Reform across Seven Continents

Chapter 3
Securities Crowdfunding and Alpha in Social Data

Chapter 4
Peer-to-Peer Lending

Chapter 5
Market Structure: Women and Millennials

Chapter 6
Behaviors Related to Savings and Investment

Chapter 7
Structured Products

Chapter 8
Underwriting and Valuations

Chapter 9
Primary versus Secondary Markets

Chapter 10
Distributed Ledger Technology for a UniversalCredit System

Conclusion

Notes

Glossary of Financial Terms

Index

Reviews/Endorsements

Endorsements

"In a world full of disruptors, peer-to-peer lending and securities-based crowdfunding have become the most revolutionary. Besides the more traditional methods of fundraising, angel investing was perhaps the only other credible source of funding. Kim Wales's book gives the reader a thorough grounding in peer-to-peer lending and crowdfunding as well as in their possible impact at every level: asset management, individual and institutional investors and regulatory, to name just a few."
—Heidi L. Steiger, Former Executive Vice President, Neuberger Berman, and Former CEO Eastern Region, USBank Private Client Reserve

"A clever marriage of the fundamentals of crowdfunding, regulation, and policy for capital markets development, this book will be helpful to today's and tomorrow's students, practitioners as well as policy makers. Kim Wales's insightful views rest on her deep hands-on experience as a change agent, lobbyist, and advocate."—Laura Bottazzi, Professor of Economics, Bologna University and IGIER, Bocconi University

"This book provides the reader with the context to understand the significant growth in crowdfunding. Kim Wales also gives insightful views as to what it would take for this market to reach the next level. Her recommendations for standardization of contracts, vocabulary, and credit ratings are particularly spot on."
—Ludovic Phalippou, Said Business School, University of Oxford

"Kim Wales has written an impressive book based upon her thorough research and understanding of a critical growth market. Anyone who is looking to the future world of funding needs to read this book."—Emily Youssouf, Adjunct Professor, New York University's Schack Institute of Real Estate

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