A Feasibility Study for the Preparation of a Crowdfunding Application seeks to determine the economic viability and feasibility of a business venture, concept, or expansion plans of an existing business in regard to crowdfunding. It delves into the necessary investments, projected returns, and external influences on the project, including State laws, competition, technological advancements, and other relevant considerations.
A Feasibility Study is a guide that enlightens the decision-maker on the potential benefits or anticipated losses of taking up a prospective venture before investing in the same. It attempts to foresee the future as well as anticipating the results of a business idea.
What is crowdfunding?
Crowdfunding is a form of fundraising where a company asks the public for small contributions (usually in exchange for equity in the company), typically via the internet. Crowdfunding has emerged as a popular alternative financing method, allowing entrepreneurs and startups to raise small amounts of capital from a large number of individuals/ investors to finance a new business venture, concept, or the expansion plans of an existing business.
The success of a crowdfunding campaign relies on several factors; therefore, conducting a feasibility study from an unbiased third party is essential to enhance the likelihood of success. Therefore, the Capital Markets Authority in the State of Kuwait obligates all listed and licensed companies to submit a feasibility study for the purpose of a crowdfunding application.
What are the governing references that companies are required to submit for feasibility studies for the preparation of crowdfunding applications?
In accordance with Module Nineteen, “Financial Technologies,” Article 2-3-6 stipulates that:
The Eligible Offer Issuer is required to engage the services of a Licensed Person by the Authority (Investment Advisor or Asset Valuator), or an Auditor registered with the Authority (including Subsidiary Companies) in order to prepare the following:
- A feasibility study of the project and its payments plan.
- Specifying the necessary funding amount and its payments.
- Assessing the value of the stake/share wavered by the Eligible Offer Issuer in the Crowdfunding Offer.
Taking into consideration that the service-providing party is an independent, neutral and is of no affiliation to the platform, agent or the Eligible Offer Issuer.
What is Baker Tilly’s approach for preparing feasibility studies?
Through our approach to preparing feasibility studies for the Preparation of Crowd Funding Applications, we look at prospective ventures from the following perspectives:
- Market Study.
- Business Model to be adopted when executing the Crowdfunding Project.
- Technical Study.
- Management Study.
- Financial Model of the Project and its feasibility.
- Financial and Economic Impacts of the Project.
- Defining the required funding and its payment terms.
- Evaluating the value of the stake/share relinquished by the Eligible Offer Issuer in the Crowdfunding Offer.
A comprehensive analysis of the above elements will assist the decision-maker in concluding the initiation or rejection of the project.
What is the added value to business entities from the feasibility study for crowdfunding purposes service?
- Compliance with regulatory requirements of the Capital Markets Authority.
- Assessing the viability and feasibility of the Crowdfunding Project.
Why Baker Tilly Kuwait?
Baker Tilly Kuwait is distinguished by specialist professional experience and offers the following characteristics carrying added value to our clients as follows:
- Baker Tilly has a license as an asset valuator from the Capital Markets Authority;
- A global consulting firm with a local presence in the State of Kuwait;
- Professional team with in-depth experience in providing investment consultancy services in Kuwait
What are the services provided by Baker Tilly Kuwait?
Feasibility study for the preparation of crowdfunding application.