Businesses that need core and early-stage financing after the 2008 financial crisis have begun to experience difficulties in accessing traditional financing instruments such as bank loans. This has hindered the survival and sustainability of innovative and technology-focused initiatives that have the potential to support economic development. However, recently, alternative financing instruments such as business angel capital and venture capital funds have begun to take place in investors' portfolios in order to facilitate the access of innovative ventures to finance.

Today there is an increase in the use of savings on the internet. Crowdfunding is a new generation of funding tool that allows a large number of people who cannot make a significant impact alone, to fund or donate small amounts to initiatives through internet sites. Crowdfunding is growing rapidly in many countries. Regulations on crowdfunding have been put into force in many countries, such as France, Italy and the United Kingdom, and finally the regulation by the Securities and Exchange Commission (SEC), the regulatory authority of the American Capital Markets, has entered into force since May 2016. When the post-2010 period is examined in Turkey, it is observed that the platforms for crowdfunding have started to be set up but the regulatory infrastructure has not been established and funding has been provided only in the form of donations.

By new regulations, it is aimed to provide a regular investment environment which will facilitate entrepreneurs' access to masses (in other words crowds), and masses to entrepreneurs through internet sites operated by crowdfunding platforms, which will be authorized by the Capital Markets Board of Turkey. The crowdfunding system will be a new financial tool that will help to eliminate the issues of the entrepreneurial companies and primarily the project owners at the early stages, in accessing the finance.

Through this system, it is envisaged that experienced and inexperienced investors come together and direct savings into investment, thus spreading the capital to the base. It is thought that this development will increase the number of entrepreneurs who need early stage financing in all sectors, especially technology-focused investments, which will increase access to finance and provide positive contributions without placing a burden on the economy and public finance.

Crowdfunding is a funding system for people who need core and early-stage financing, and financing costs are very important for these people. For this reason, by the amendments made in Articles 3, 4 and 16 of the Capital Market Law and by the Article 35/A added to the Law, the Capital Markets Board of Turkey (the Board) has given the authority to make the necessary regulations regarding crowdfunding and authorization of the crowdfunding platforms. In addition, crowdfunding and crowdfunding platforms will not be subject to the provisions of the Law relating to publicly held partnerships, public offerings, issuers, explanatory and issuance obligations and investment services and activities, ancillary services and exchanges, market operators and other organized market places. On the other hand, in the event that it is determined that money is collected from people through crowdfunding platforms without permission, the Information Technologies Authority is authorized to prevent access to the related web site by the suggestion of the Board. The activities of crowdfunding platforms and investment processes and rules will be determined by the Board in a secondary manner, thereby aiming to provide a reliable and effective crowdfunding environment.

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