NAVIGATING UNCHARTED WATERS: A STUDY OF EQUITY CROWDFUNDING IN INDIA

Abstract

It is said that necessity is the mother of invention. After the financial crisis of 2008 hit hard, the dire economic conditions necessitated small businesses and start-ups to find out alternatives to the conventional paths of financing their business ideas. Fortunately, with the advancement of technology and the increasing use of the ubiquitous internet, people realized its potential of being a great marketing tool. Although, the idea of asking the members of one’s local community, to contribute towards the advancement of any cause or business venture that one seeks to promote, is not exactly new, but in the era of internet, when the same funding is sought after, through online platforms and social media, transcending beyond the limits of one’s local community to the world at large, it is understood to be Crowdfunding. This paper is a study of the concept of crowdfunding and attempts to analyse and comment upon the regulatory regime present, if any, in the Indian legal framework in this regard.