A Research About Crowdfunding Pricing Mechanism Based On Two-side Market

Crowdfunding is an important part of Internet financing, and play an important role in the whole financial system. Now more and more people start to know Crowdfunding as a financial tool, and Crowdfunding platforms are founded rapidly. As a new thing, there are many things to do to make it perfect, but it exposed a lot of problems for immature operation mechanism and imperfect business model. A large number of Crowdfunding Platforms are forced to stop their business, contrasting to the prosperity of Crowdfunding markets. There is no doubt that Crowdfunding Platforms are very important, it’s necessary to strengthen the theoretical study of the Crowdfunding Platform for the healthy and stable development of Crowdfunding.Crowdfunding Platform is the subject in this paper, and platform pricing is a point of this study. This paper do some research on platform profits and some related questions.Firstly, this paper have an overview of Crowdfunding in details based on a literature review of the definition of different perspective on Crowdfunding. There are three elements of Crowdfunding:entrepreneur, Crowdfunding funders and crowdfunding platform. I build the basic framework of the Crowdfunding business models based on these elements. Then I classify different Crowdfunding models depending on the way of returns, including donation-based Crowdfunding, awards-based Crowdfunding, loan-based Crowdfunding and equity-based Crowdfunding. Secondly, this paper do a detailed feasibility studies to prove the two-sided characters of Crowdfunding platform from the matching of supply and demand, network effects, decentralization and risks. Finally, based on two-sided market theory, this paper build a two-sided market model of Crowdfunding, the study found that the cost of management, network effects and effects of market participants is the main basis for pricing platform, and the same time the platform managers should also consider price sensitive, risk, project effection and other factors in pricing.The contribution of this study is to think Crowdfunding Platform pricing from the perspective of two-sided market, on the one hand providing some guidance to Crowdfunding platform operators during the operation, also it broadens the way to study Crowdfunding.