Assignment Task:
Task:
- Real Estate Crowdfunding in The Developing Economy
- By
- Anathi Mpanza
- 220160724
- Submitted in partial fulfilment of the requirements for the degree
- Honours in Property Valuations and Management
- In the
- Department of Finance and Investment Management
- Of the
- College of Business and Economics
- At the
- University of Johannesburg
- Supervised by
- Mr Kelvin Ng
- 14 July 2021
- Table of contents
- TOC \o 1-1
- Introduction PAGEREF _Toc \h 3
- Case Studies PAGEREF _Toc1 \h 3
- Data Collection PAGEREF _Toc2 \h 4
- Structure of the interviews PAGEREF _Toc3 \h 4
- Data analysis PAGEREF _Toc4 \h 5
- References PAGEREF _Toc5 \h 6
-
- IntroductionCrowdfunding usually targets companies that generally fit the prototype of small and medium-sized enterprises (SMEs) and start-ups, that is, similar companies that have the most difficulty in obtaining financing in developing countries. According to data from the World Bank (2021), 47% of SMEs and 41% of medium-sized enterprises in Africa regard access to financing as a major obstacle to growth, and financial institutions in developing countries tend to choose investment locations carefully. Compared with potentially dangerous innovators or unknown startups, they prefer stability and safety. Small and medium-sized enterprises in developing countries, or even a particularly entrepreneurial person, can bypass formal financial institutions or even microfinance programs (which can provide them with credit, but usually charge higher interest rates than traditional financial institutions) to obtain financing. This methodology section therefore aims to examine the trend of real estate and crowdfunding in South Africa by using two case studies and a sample population.
- Case StudiesAn overlapping case study design was adopted to evaluate and fully comprehend the concept of real estate and crowdfunding and its connections. The notion of crowdfunding is extremely complicated and, in many cases, context dependent. The case study technique allows for the examination of a wide range of data in order to define background settings and understanding of the state (Mitchell and Rich, 2020). Two case firms with similar contexts of real estate initiatives in South Africa but differing in the crowdfunding designs used and the type of real estate, were chosen to demonstrate the factors that motivate different types of funders, impact decision-making habits, and eventually drive marketing performance. Most importantly, the case studies were handful in stating and explaining the trends of REC in South Africa and how they affect the Real Estate market.
- Data CollectionNumerous data collection methods can be used with the case study approach (Berbegal?Mirabent, 2013). As such, the data was gathered from a sample population of 16 experts was collected through systematic sample with each volunteer participating through informed consent. They were divided into two groups: real estate and crowdfunding experts more specifically from managerial and financial sectors. The first group of interview sessions involved executives from the case studies: Reality Africa’s Chief Executive Officer and The People’s Fund’s Executive officer.
- The second portion of participants included six persons from crowdfunding platforms as well as four persons from two real estate platforms and four personnel from two crowdfunding associations. The idea was to have a variety of expert from different parts of the country as possible.
- Structure of the interviewsThe interviews were conducted in a semi-structured format and were conducted in person or over the phone. Most of the interviews were conducted between 17 March and 29 May 2021, with a few extra interviews taking place on 30 February 2021. Most of the interview sessions were taped and transcribed.
- Data analysisDesk research utilising information from the firm's and crowdfunding platform's websites and in-depth interviews were used to analyse the cases. The phenomenon of real estate crowdfunding in developing countries was explained using a theoretical framework that combined real estate investment theory with crowdfunding campaign performance studies.
- The interview sessions were recorded, and the information was organised and summarised by subject. Premised on the professional analysis of the crowdfunding society and the evaluation of the present circumstance using the conceptual method for analysing the capability of the crowdfunding market, conclusions about current demand, and assertions about the advancement of the real estate crowdfunding market in South Africa have been suggested.
- ReferencesBerbegal?Mirabent, J., 2013. Doing Research in Business and Management: An Essential Guide to Planning Your Project20131Mark Saunders and Philip Lewis. Doing Research in Business and Management: An Essential Guide to Planning Your Project. Harlow: Pearson Education 2012. 233 pp., ISBN: 978?0?273?72641?8 (paperback). Management Decision, 51(6), pp.1311-1316.
- Mitchell, A. and Rich, M., 2020. Business School Teaching of Research Methods – A Review of Literature and Initial Data Collection for Undergraduate Business School Students. Electronic Journal of Business Research Methods, 18(2).
- World Bank, 2021. World Bank SME Finance. [online] World Bank. Available at: <https://www.worldbank.org/en/topic/smefinance> [Accessed 12 July 2021].
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