New Academic Research on Crowdfunding

CrowdFund Beat News Wire, PRESS RELEASE
California Management Review Publishes Special Issue on Crowdfunding

Popular opinion suggests that major crowdfunding platforms serve to democratize the process of innovation, enabling entrepreneurs and creators in a way that could not be supported under traditional models. But emerging research paints a more nuanced picture.

The popularity of crowdfunding among entrepreneurs and investors has opened up new opportunities that would not have been possible in the pre-internet era. For example, pre-sales on Kickstarter allow would-be creators to get a sense of demand for their product before investing heavily in development and manufacturing. Other crowd-based platforms like LendingClub actively seek to subvert existing financial institutions by facilitating peer-to-peer lending.

“Crowdfunding offers something other funding mechanisms do not—a way to democratize access to the capital needed to commercialize and distribute innovation.”

As a rapidly emerging and evolving phenomenon, crowdfunding is still being studied extensively. A new collection of articles published in the latest issue of California Management Review highlights the strengths and weaknesses of crowdfunding as it exists today.

 

 

 

In 2014, musician and entrepreneur Jack Conte published a blog post describing the financials of his band Pomplamoose’s 28-day U.S. tour. Conte explained that despite selling out shows at many historic venues, the band actually lost over $11,000 on tour, providing evidence of the decline in the music industry. To combat this trend, Conte founded a new crowdfunding platform, Patreon, that allows supporters to send a defined amount of money to artists each time they release new material. He hoped that this would allow fellow creators to make a living in the new digital economy.

Conte is on the right track. Earlier this month, Patreon raised an additional $30 million in Series B funding. The platform joins a stable of successful crowdfunding websites like Kickstarter and Indiegogo, which have famously funded a wide variety of projects ranging from the production of albums and short films to 3D printers and smartwatches. While Conte’s success cannot be disputed, a major question remains: can crowdfunding become a solution for everybody, or just a handful of outliers?

SPECIAL ISSUE Crowdfunding

In the past, launching a company and shipping a product was something that could only be done by those who had money, or those who could attract investment from venture capitalists. But things are changing. The advent of crowdfunding platforms — internet-based marketplaces that connect those seeking funds with hundreds if not thousands of supporters — has been greeted with enthusiasm by entrepreneurs, policymakers, and the general public alike. Their enthusiasm is understandable: today, normal people can invest in ideas that they think might gain broad appeal. But crowdfunding remains an emerging and evolving phenomenon that is not well understood. Far from a fad, this mega trend is here to stay — and has broad implications across many industries.

 

Tags: , , , , , , , , , , ,

HEADLINE NEWS

Forbes4 Dirty Little Secrets Of Crowdfunding And Why You Should Still Do ItForbesI have supported friends' crowdfunding campaigns over the years, but never envisioned crowdfunding my own entrepreneurial endeavors. Then I met Karen Cahn, creator of iFundWomen, a new crowdfunding p [...]

Mountain XpressFaces in the crowd: WNC crowdfunding initiatives | Mountain XpressMountain XpressEach week, Xpress highlights notable WNC crowdsourcing initiatives that may inspire readers to become new faces in the crowd. This week features a ...and more » [...]

Forbes7 Ways To Generate PR For Your Crowdfunding CampaignForbesAs a contributor to Forbes, I've seen thousands of pitches from companies using crowdfunding platforms like Kickstarter and Indiegogo. The senders are generally in a state of desperation, frantically trying to get me [...]

Equity Crowdfunding: What Kinds of Businesses Are Being Funded?Motley FoolThe Jumpstart Our Business Startups Act -- aka, the JOBS Act -- went into effect last year, opening up the equity crowdfunding industry. In this clip from Industry Focus: Tech, Motley Fool tech analyst Dylan Lew [...]

The Star OnlineCrowdfunding: Crowded with failuresThe Star OnlineHigh profile: Pebble was one of the major successes on Kickstarter with each model of the smartwatch launched on the crowdfunding platform exceeding its funding goals. Unfortunately, that couldn't save the company a [...]

Five garden crowdfunding projects to back this springThe Guardian (blog)Five garden crowdfunding projects to back this spring. From giving women at Yarl's Wood a place to garden, to transforming a Glasgow community's soft drinks habit, these projects are all seeking funds to [...]

EntrepreneurHow to Launch a Successful Crowdfunding ProjectEntrepreneurThis is exactly what Andrew Thomas did. Thomas is the co-founder of Skybell, an interactive video doorbell for your smart home. Thomas went right into the heart of entrepreneurship when he became one of the top 10 [...]

Fraud concerns prompt JustGiving to verify victim crowd-fundingBBC NewsFor the first time, the company has taken direct control of a crowd-funding page, which any individual can set up. Concerns were raised over a fund for the family of Aysha Frade, after a person who set up the page [...]

Eater SeattleBlack and Tan Hall Making Final Push to Open With Crowdfunding CampaignEater SeattleBlack and Tan Hall, an upcoming music venue/restaurant project in Hillman City that aims to unite the diverse neighborhood, is nearly open. The owners are making a final push via GoFundMe [...]

The SunArsenal fan plots sensational crowdfunding campaign to BUY the club from unpopular owner Stan KroenkeThe SunAN ARSENAL fan is taking matters into his own hands in an attempt to BUY OUT the club's majority shareholder Stan Kroenke. Speaking on Reddit, the supporter has prop [...]

CFB Finance

Marketwired

  • Crowdfunding
  • Crowdfund
  • Peer to Peer Lending
  • FinTech
  • Reg A+
  • Reg CF
  • Crowdfunding USA

Press Release

Live Crowdfunding .tv

What's Next Step in Regulation A+ JOBS ACTS Title IIII :L Interview : Steve Cinelli with Brian Korn Securities and Crowdfunding/Peer-to-Peer Lending Lawyer, Watch more video library | Conference | Interview | Campaign Showcase | Research | Education |