A BREADTH OF INDUSTRIES WITHIN THE FRENZY OF CROWDFUNDING

By RYAN SCHELLHORN, CrowdFundBeat Guest Editor,

July 1, 2015– The past twelve months was a year of growth for the crowdfunding industry, where many record-setting and equity-based crowdfunding campaigns took place. In fact, according to a report by CNBC, crowdfunded projects have conducted fundraising totaling to $662 million in the first quarter of 2015.

The fund-raising mechanism behind the crowdfunding frenzy wasapproved last year. The businesses within this sphere engage in a range of operations and span a plethora of industries, most prominently in the food and beverage, biotechnology, software, health and fitness, music, and real estate industries.

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Food & Beverage

One of the successful companies within the food and beverage industry is craft brewer Renaissance, one of the first companies to raise money through equity crowdfunding in August of this year. Conor Roberts, a public relations executive that invested $2,000 in Renaissance, explains that “Building up of a sense of community around the business is something those companies can do quite well.”

Renaissance has become a poster-boy for the beverage industry’s movement toward equity crowdfunding. Evidently, this method of capital raising allows for companies like Renaissance to develop communities around their company. Taking a stake in the funding of the business both deliberately and inadvertently spreads word about the business, and the shareholders of the company garner more supporters of the company. This in turn creates a positive feedback loop as more and more people become not only personally but also financially invested in the company.

Health & Fitness 

The health and fitness industry has also seen elevated involvement in the crowdfunding mushrooming. Seedrs, is a London-based crowdfunding platform focusing on businesses in the health, sport, and wearable technology spaces.

Music & Entertainment

The music industry is another prominent player within the equity crowdfunding space. Quincy Jones, a veteran of the music production industry, is the latest celebrity to turn to the merging crowdfunding platform. Jones, along with other executives of his New York-based company called Playground Sessions, has raised $810,000 so far for the company through the crowdfunding. Playground Sessions teaches piano to students through a virtual medium. Neil Young is another musician that has entered the crowdfunding realm but working to raise money on a music campaign.

Biotechnology

The biotechnology industry is another sector that has seen a growth in capital raising from crowdfunding platforms. The standard route for biotechnology companies and other life sciences businesses striving for growth conventionally involved contacting venture capital firms. But the new SEC rules under the JOBS Act now allows startups to receive investments from large pools of investors, any many tech companies have cashed in on the looser regulations. For example, a Welsh biotech company founded by a Nobel laureate has claimed a UK record for crowdfunding in the life sciences sector after raising almost 700,000 pounds. This crowdfunding platform has essentially allowed the company to provide a new model for financing medical research. In addition, Health Tech Hatch and Medstartr have gotten some attention for their efforts to use crowdfunding for health technologies.

Technology

Crowdfunding has also seen massive success in the software industry, with many explosive SaaS products taking off like wildfire. For example, Oculus Rift and the Pebble Watch are all byproducts of the crowdfunding movement.

Groundbreaker is a software product that also represents crowdfunding growth in the real estate industry. Groundbreaker is a real estate crowdfunding platform provider and has announced that they are transitioning their white label service to a full SaaS(software as a service) product. Crowdfunding for real estate is quickly growing into its own, as some industry watchers expect the industry to boom over the 12 to 24 months. The industry captures a perfect marriage, coupling the efficiencies of technology with a tangible asset. Accredited investors may today invest in high quality real estate anywhere around the country.

Conclusion

Crowdfunding has emerged as an effective alternative to venture capital as a way of gaining financing and jumpstarting businesses. In essence, equity crowdfunding democratizes ownership and investment in projects. Many celebrities have already taken action to show their support of the growth in crowdfunding platforms. In fact, Andy Murray joined the Seedrs Advisory Board, representing the first partnership where a public figure teamed up with an equity crowdfunding platform, heralding a significant milestone in the development of the equity crowdfunding industry.

Evidently, this newfound crowdfunding platform has helped stimulate the growth of business across a breadth of industries such as food and beverage, biotechnology, software, health and fitness, music, and real estate.

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HEADLINE NEWS

Marketplace.orgCrowdfunding for your lifeMarketplace.org"When I took that phone call, and I learned that this was just going to completely uproot my whole life, I'd say I spent maybe 10 seconds or so only freaking out about myself and whether or not I would die. And then imm [...]

The HinduYoung Moroccans change lives with crowdfunding - The HinduThe HinduAccess to funding is vital for young Moroccan companies. Two young men have recently developed an application that enables projects to get financed by ...and more » [...]

TIMEA Crowdfunding Effort Launches to Commemorate Khadija Saye, Artist Killed in London InfernoHyperallergicOn Saturday, friends and supporters of the artist Khadija Saye — who died in the devastating Grenfell Tower fire in west London last week — launched a crowdfunding campaign to c [...]

Santa Ynez Valley NewsTrikke Tech consolidates operations in Buellton, launches ...Santa Ynez Valley NewsTrikke Tech Inc. has consolidated all its operations at a new location in Buellton and launched a crowdfunding campaign to help the company expand and ...and more » [...]

CBS NewsNow you can crowdfund a 529 college savings plan - CBS NewsCBS NewsIt's getting easier to have friends and family add their contributions to these accounts for college savings.and more » [...]

ForbesThis $130 Million Fund Is Leading The Way In Real Estate CrowdfundingForbesWhen people think of crowdfunding, the first word that jumps to mind is Kickstarter. But crowdfunding is not limited to supporting the next card game or independent film. Crowdfunding is becoming a viable [...]

Forbes"Make Yourself Available" - An Audio Entrepreneur's Tips For Successful CrowdfundingForbesIt takes a brave individual to launch Bluetooth speakers and headphones into a crowded audio market. Take a stroll around your local consumer electronics stores and you' [...]

WMFD.comLegislation Permitting Intrastate Equity Crowdfunding PassesWMFD.comCOLUMBUS, OH - State Representative Mark Romanchuk (R-Ontario) Thursday applauded the Ohio House for approving legislation that permits, in certain circumstances, intrastate equity crowdfunding, with the goal [...]

Business InsiderCrowdfunding for medical expenses - Business InsiderBusiness InsiderAlmost half of the money raised on crowdfunding sites like GoFundMe and YouCaring is going toward medical expenses. Medical campaigns make up $930 ...Americans Losing Health Insurance Turn To Crowdfund [...]

PC GamerAshes of Creation launches 'Summer Crowdfunding Extension ...PC GamerThe ambitious MMO Ashes of Creation was successfully crowdfunded in just one day last month, before ultimately accumulating a staggering $3271809—this ...and more » [...]

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