Equity Crowdfunding

Definition ∞ Equity crowdfunding allows a broad base of smaller investors to fund private companies in exchange for an ownership stake. This method of capital raising democratizes investment access beyond traditional venture capital. It provides startups with a means to secure financing by issuing shares or security tokens to a large number of individuals.
Context ∞ Equity crowdfunding is a significant topic in discussions about alternative financing models and regulatory innovation, particularly in how digital assets might tokenize equity. Regulatory frameworks are still evolving to support and supervise these offerings, ensuring investor protection while facilitating capital formation. News often covers successful campaigns or changes in regulations affecting this sector.