Should You Crowdfund with Clients?


BY Lauren Barack, Think eTrade revolutionized online financials? Welcome to crowdfunding — the ability to for anyone to invest in nearly any kind of option or entreprise over the Internet at any time. “Crowdfunding is essentially an very old ancient concept,” says Jason Best, co-founder of Crowdfund Capital Advisors, advising investors and entrepreneurs on soliciting funds through crowdfunding. “What new is the ability to publicly solicit via social media. It’s going to a very big change.”  Nearly anyone who spends time on the Internet is familiar with Kickstarter — the online site that offers rewards to crowds of users who kick down (usually) small sums of capital to help launch a new satellite, self-cleaning shirt or an all-natural licorice company. The firm is expected to tip $1 billion in funds raised sometime in 2014.  Crowdfunding however is different. Here’s there’s no promise of a key chain, vintage postcard or a rainbow array of sweets once the project is funded and completed. Here the reward is un-promised — an investment made in a small business or start-up that may pay a return — and more likely will not. After all, 50 percent of small businesses fail in the first five years according to the U.S. Small Business Administration. To date, investors have long had the opportunity to invest in a friend’s new bar, a sister’s catering business or an uncle’s new bike shop, but not through general solicitations.

But Title III of the 2012 Jobs Act, should open the doors to allow companies to solicit investments from literally anyone — accredited or not. It’s now in a 90-day comment period expected to close in January 2014. Online firms are lining up, getting ready for what they believe is bound to turn investing on its ears. There’s even talk of launching an accreditation for reps through the nascent National Crowdfunding Association, says its executive director David Marlett. Yet, even some of crowdfunding’s biggest cheerleaders are asking: Is this the right investment vehicle for everyone?


ForbesThe Ultimate Pre-Launch Crowdfunding ChecklistForbesCrowdfunding is not limited to the platform where you launch your campaign. Instead, it has become a valuable way to transform your idea into a mainstream business. In order to head in that direction, you must execute a number [...]

The AustralianIgniteme heats up crowdfundingThe Australian“The only other comparable film that raised money through crowdfunding would be Crocodile Dundee, but not all funding came from the crowd.” Mr Morello said the idea behind the platform was relatively simple — giving new and bud [...]

DVS Gaming (registration) (blog)Crowdfunding: How Does it Help Indie Developers?DVS Gaming (registration) (blog)2012 is when crowdfunding really blew up, prior to 2012 the average amount of money devs would receive could range from 10k-100k. By today's standards, that's stil [...]

The MemoCrowdfunding has become a 'monster' argues its greatest criticThe MemoBrown has become a thorn in the side of this blossoming industry, even more so as it's clear his blog is now even read by regulators at the Financial Conduct Authority. The Memo sat down with [...]

U.S. News & World ReportNo Cash for Hate, Say Mainstream Crowdfunding FirmsU.S. News & World ReportThe block on mainstream crowdfunding is just the latest blow to far-right activists operating online. In the last 24 hours, neo-Nazi website the Daily Stormer had its domain regi [...]

LivemintFinding the right balance on crowdfundingLivemintSecurities market regulator Sebi (Securities and Exchange Board of India) has been trying to get a handle on digital platform-based crowdfunding since at least 2014, when it issued a cautiously positive consultation paper. It fl [...]

Crain's Cleveland Business'Smaller' gifts can go long way for Clinic's crowdfunding platformCrain's Cleveland BusinessFor an institution accustomed to securing multimillion-dollar donations, Cleveland Clinic's latest fundraising effort has some relatively [...]

Australian Brews NewsBrewery crowdfunding effective overall: PozibleAustralian Brews NewsEquity crowdfunding by breweries overseas has been effective overall, despite some high profile failures, according to Pozible. The largest reward-based crowdfunding platform in the Asia Pacific, [...]

FortuneUncensored Social Network Gab Raises $1 Million in Crowdfunding CampaignFortuneA crowdfunding campaign for Gab, a Twitter-like social network that touts its commitment to freedom of speech, surpassed $1 million yesterday. The company claims it is politically neutral and committ [...]

Crowdfund InsiderIsraeli Crowdfunding Platform ExitValley Self Crowdfunds, Plans UK ExpansionCrowdfund InsiderThe digital platform to book parking anywhere raised $2 million – a portion of that, $270,000, reportedly came from ExitValley. To date the self-crowdfunding offer has raised [...]

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