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Jan Wyllie

The wisdom of crowdfunding: business's quiet revolution [20Oct11] - 0 views

  • In recent years, hundreds of crowdfunding sites have sprung up worldwide, covering everything from games and mobile apps to performing arts and businesses, including a number in the UK such as Crowdcube and Crowdfunder.
  • Rubin outlines four key reasons why people contribute to crowdfunding projects: "The first is because they care about the person, or the cause, or the campaign. The second is because they want the product or the experience. The third is because they want to be part of something bigger than themselves. And the fourth is because they want profit. The first three are serviced on Indiegogo in a dynamic way; the fourth is illegal right now [in the US, although not in the UK]."
  • "I have very little doubt that 10 years from now, crowdfunding will be embedded into the financial fabric of the world, just in the way credit cards are
Jan Wyllie

Shareable: Crowdfunding and the Law [13Oct11] - 1 views

  • these laws now make it almost impossible to invest in small businesses in our communities and pretty much compel us to invest in the New York Stock Exchange. In the name of protecting investors, securities laws now make it very difficult to raise money with crowdfunding.
  • Failure to comply with these requirements can, at a minimum, result in having to return all your investors’ money. At worst, there could be civil and even criminal penalties.
  • Ask for donations!
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  • people sometimes offer “perks” in exchange for contributions. To our knowledge, none of these offerings has been subjected to scrutiny by securities regulators to date, but it is possible that even the offering of a perk in exchange for a donation could convert these offerings into securities in the eyes of some state governments.
  • There are two crowdfunding web sites that have spent tens of millions of dollars in legal fees so that they can offer crowdfunding opportunities that are compliant with state and federal securities laws. These are Prosper and Lending Club.
  • A proposed bill, HR 2930 (McHenry), would exempt offerings of up to $5 million with a maximum of $10,000 or ten percent of net worth per investor and would exempt such offerings from state-level registration requirements. Meanwhile, President Obama recently proposed a similar exemption.
Marc-Alexandre Gagnon

Crowdfunding Can Help You Sell a New Product or Idea | SBA.gov [11Aug11] - 0 views

  • While the phenomenon is not new, it is still not a mainstream concept and therein lies it beauty.
  • Three things to consider for taking your project to the crowdfunding street:
  • you have to be able to complete the whatever-it-is because the nature of crowdfunding demands completion.
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  • Do you have an audience?
  • Have you really crunched all the costs?
  • Make sure, per point number two, that you can deliver.
  • Crowdfunding isn’t a new sales channel, but it can certainly help you test a new idea or product in a short amount of time.
  • You’ll still have to “sell” the idea to this crowdfunding audience, however, most of the people who participate understand that they are helping someone else achieve their dreams.
Jan Wyllie

Kickstarter School - Kickstarter - 0 views

  • What are you raising funds to do? Having a focused and well-defined project with a clear beginning and end is vital.
  • Rewards are what backers receive in exchange for pledging to a project. The importance of creative, tangible, and fairly priced rewards cannot be overstated.
  • Every project’s primary rewards should be things made by the project itself.
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  • four common reward types
  • Copies of the thing
  • Creative collaborations
  • Creative experiences
  • Creative mementos
  • To date the most popular pledge amount is $25 and the average pledge is around $70.
  • Actual value considers more than just sticker price.
  • Projects must set a funding goal and a length of time to reach it. There’s no magic formula to determining the right goal or duration.
  • Funding comes from a variety of sources — your audience, your friends and family, your broader social networks, and, if your project does well, strangers from around the web.
  • Because funding is all-or-nothing, you can always raise more than your goal but never less.
  • Projects can last anywhere from one to 60 days, however a longer project duration is not necessarily better. Statistically, projects lasting 30 days or less have our highest success rates
  • making a video is a challenge worth taking on. It says you care enough about what you’re doing to put yourself out there. It's a small risk with a big reward.
  • videos must be 1000MB or less and have a file type of MOV, MPEG, AVI, MP4, 3GP, WMV, or FLV.
  • for most projects, support comes from within their own networks and their networks’ networks.
  • A nice, personal message is the most effective way to let someone know about your project. Send an email to your close friends and family so they can be first to pledge, then use your personal blog, your Facebook page, and your Twitter account to tune in everyone who’s paying attention.
  • Don’t be afraid to take your Kickstarter project out into the real world
  • Project updates serve as your project’s blog. They’re a great way to share your progress, post media, and thank your backers.
  • treat your project like a story that is unfolding and update everyone on its progress
  • don’t forget about all the people that helped make it possible. Let backers and spectators watch your project come to life by sharing the decisions you make with them,
  • The story of your project doesn’t end after it gets shipped out. You still have a captivated audience that’s cheering for you.
  • Remember to take shipping costs into account before you start your project.
Jan Wyllie

Crowdfunding Nation - 0 views

  • Kickstarter notes that it took 16 months to reach the first 200,000backers, while the last 200,000 signed on in only three months. Funding projects ishabitual, according to Kickstarter’s figures. Out of 1,013,725 total backers,166,823 have funded two or more projects, 66,676 have backed three or more, and23,601 have backed five or more.
  • Kickstarter revealed some usefulinsights on what types of projects get the most traction on their creative-orientedplatform. Music, film and video are the clear frontrunners
  • With such growth, critiques are inevitable. Perhaps most common is the fearthat we’re in a crowdfunding “bubble”.
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  • The Emergence of TribeSourcing 
  • New platforms will therefore includemechanisms that enable projects within a particular community to be evaluated, voted upon and supported. They will also include collaboration features that enablemembers in the larger ‘tribe’ to provide non-financial support:
  • It is a fundamentally empowering process that engages people inmeaningful action
  • What started out as a cool way tosupport your local band by getting their first recording out to their fans has evolvedinto a recognizable platform for bypassing bureaucratic institutions and taking action straight to the crowd
Marc-Alexandre Gagnon

FAQ: What startups should know about the U.S. crowdfunding bill | VentureBeat [05Nov11] - 0 views

  • On November 3, the U.S. House of Representatives passed H.R. 2930 (the “Entrepreneur Access to Capital Act”), a crowdfunding bill that will allow startups to offer and sell securities via crowdfunding sites like Kickstarter, as well as social networking sites such as Facebook and Twitter.
  • this change could be huge for startups and lifts certain securities law prohibitions that have been on the books since the 1930s.
  • the North American Securities Administrators Association (NASAA), a trade group for state regulators, has been lobbying very hard against the House Bill to prevent the preemption of State law and to reduce the maximum investment amount per investor.
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  • Until the crowdfunding bill becomes law, startups should avoid selling stock or other securities via crowdfunding sites or social networking sites.
  • For example, as a recent Wall Street Journal article pointed out, the crowdfunding site ProFounder “drew scrutiny from California securities regulators and was recently forced to abandon its original mission of providing online sales of equity stakes in small businesses.”
  • Any companies that raised funds via Profounder now run the risk of having violated applicable federal and state securities laws by utilizing an unregistered broker-dealer.
Jan Wyllie

Steve Case: It's Crazy You Have To Be An Accredited Investor, But Don't Have To Be An "... - 0 views

  • His crowdfunding proposal would require the government to relax the rules around accredited investors (i.e., wealthy individuals) being the only ones allowed to invest in private companies. Some crowdfunding proposals out there would allow anyone to invest up to $10,000 in a private company without being an accredited investor. “It seemed crazy to me that you have to be an accredited investor to invest in a company,” says Case, “but you can go to Las Vegas and lose $10,000 at the table in an hour but you don’t have to be an accredited gambler to do that.”
Jan Wyllie

Shareable: The Motorhome Diaries: The Dance of Crowdfunding [14Oct11] - 0 views

  • Crowdfunding, by its very nature, demands that we set aside both our egos and our insecurities. We must humble ourselves enough to ask for support from others while fully believing that we are worthy to receive the offerings that come.
  • My goal was to raise money to buy and renovate an old motorhome to live in so that I could cut my overhead and live within my minimal means.
  • So, I laid out my terms: For every $20 someone contributes toward my motorhome fund, I will volunteer one hour of my time to help a non-profit of their choosing.
Jan Wyllie

Shareable: What You'll Need to Run a Successful Crowdfunding Campaign - 0 views

  • Find A Crowd
  • It’s about getting a lot of people involved in your cause. So you’ll need a crowd of people who want to see your project succeed.
  • Tell A Good Story
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  • . What is it that you’re trying to do? Why should they care about it? What will they get out of the experience that makes it special to them?
  • Create Value for the Community
  • carefully consider just what your community values
  • Use Social Media Tools
  • Talking with the crowd is ongoing, dynamic, and sometimes outright intense.
  • Get Your Fans to Spread The Word
  • You’ve got to ask more of your fans AND do it in a way that helps them feel good
  • Follow Through on Your Promises
  • You’ve got to deliver the rewards, stay in contact with your fans while you create your killer product, and get it out in the world like you said you would.
Jan Wyllie

Shareable: Of The Crowd: Q&A W/ Kickstarter's Daniella Jaeger - 0 views

  • Projects don't need to be flashy, they just need to have personality—soul. A strong project has a clear focus, and making a personal connection is key, which is why a video is essential. The value of video cannot be overstated! And then, inspired rewards.
  • we are dedicated to a site that's completely devoted to creativity.
  • Backing a project on Kickstarter is a combination of commerce and patronage.
Jan Wyllie

The Kapipalist Manifesto, The Principles of Crowdfunding - 0 views

  • Crowdfunding is based on the following principles: 1. Your Friends Are Your Capital Your social network friends and contacts can help you to raise capital. 2. Your Friends Make Your Dreams Come True Any of your contacts can make a contribution, no matter how small.Together they will help in achieving your every wish, project, and dream. 3. Your Capital Depends on the Number of Friends Many contributions can build big capital.The more contacts you have, the greater your chances of reaching the amount you need. 4. Your Capital Depends on Trust Contribution doesn't happen automatically. Even if you contact a large number of people,you must still gain their trust, especially if you don't know them personally. 5. Your Capital Grows by Word Of Mouth Your friends can contribute by giving money, but also by spreading the word.This will help your social network grow, and increase the probability of reaching your goal.
Jan Wyllie

Micropatronage Sweet Spot: The micro-price of micropatronage [27Sep10] - 0 views

  • Because prices can be set across a range, price sensitivity can be explored. But crowd-funding patrons are creatures of the market here as everywhere. Provide too many options, and the potential contributor faces too much choice, and may leave without posting a contribution.
  • The $50 tier dominates, bringing in almost 25% of all earning. Surprisingly, $100 is a not too distant second at 16%. $25 brings in a healthy chunk too, but the overwhelming conclusion from this data is that people don't mind paying $50 or more for a project they love.
  • The lower priced levels are also significant. Reward tiers under $25 constitute a combined 38% of pledges and 10% of dollars raised on Kickstarter. $10 rewards are the third-most popular (ninth in dollar contributions to the site), and $5 rewards are the sixth-most popular (seventeenth in dollar contributions).
Jan Wyllie

Shareable: Crowdfunding Nation: The Rise and Evolution of Collaborative Funding [12Oct11] - 0 views

  • Be realistic, and make sure you’re setting the goal at something achievable — if you can’t hit that total, you’ll be walking away with nothing but squandered good will.
  • Moreover, the collaboration enabled by peer-to-peer social lending and funding platforms represents a unique opportunity presented by The New Sharing Economy.
  • Crowdfunding will continue to evolve. Services such as Sprowd aim to make it a credible way to fund startups. Congressional Bill HR2930 could make it easier for businesses to raise equity from investors through campaigns.
Jan Wyllie

Why Crowdfunding is Bad for Business (Opinion) [23Dec11] - 0 views

  • Startups don't just need money -- they need expertise. In the current scheme of things, investors often provide that expertise. They became wealthy because they know something about how to run a successful business.
  • But in a crowdsourced model, no one investor has substantial money in the venture. So there's no one who could insist on a board seat as part of their deal, or otherwise make an entrepreneur take their ideas seriously for how to grow the business. That makes the startup a riskier venture, both for the investors and the entrepreneur.
Jan Wyllie

Crowd-Funding Campaign Lessons Learned: What You Need to Know (1) [31Dec11] - 0 views

  • Kickstarter emphasizes project-based funding campaigns, and the projects they accept generally need to have a definite end-date and clear metrics for completion and success. For businesses just starting out (like ours), the lack of an “end” to your vision may preclude you from qualifying. But where Kickstarter focuses on funding projects to completion, IndieGoGo promotes the broad funding of ideas, from for-profit businesses to not-for-profit causes to creative endeavors.
  • We went with IndieGoGo—we didn’t meet Kickstarter’s project-oriented criteria—and we were charged 9% on the contributions we received (a fee that gets kicked down to 4% if the campaign reaches its funding goal).
  • make sure someone on your team can have a strong, dedicated focus on the campaign—it won’t take off without it.
Jan Wyllie

Crowd-Funding Campaign Lessons Learned: What You Need to Know (2) [31Dec11] - 0 views

  • A majority of our contributions came from people we know. Our enthusiastic team of Tweeters, Facebookers, and staff who supported the campaign and alerted their friends and followers brought us a strong a first-tier network of funders.
  • The IndieGoGo staff selects campaigns they believe exhibit a high “GoFactor” to highlight on the first page of results
  • There are loads of articles on the web with ideas for perks from successful campaigns, but keep in mind that those benefits should be thoughtfully tied to your core project.
Jan Wyllie

Crowd-funding: We need to scrap the dumb SEC rule that prevents small businesses from r... - 0 views

  • The hope is that crowd funding will give kitchen-table investors the ability to buy in to a much broader range of opportunities, and will give start-ups access to a whole new pool of capital—the money sitting in every American’s checking or savings account. Advertisement placeAd2(commercialNode, 'midarticleflex',false,'') One site that is experimenting with something like this is SlowMoney, profiled by journalist Amy Cortese in her 2010 book Locavesting. SlowMoney facilitates investment clubs that evaluate proposals from farmers and other purveyors of local agricultural goods
  • It gives a massive pool of investors—basically everyone—access to a wide range of companies. And it gives that wide range of companies access to a massive pool of investors.
Jan Wyllie

Crowd Funding for Photography Gets Off to Shaky Start [29Mar11] - 0 views

  • Despite travails, van Houtryve sees a lot of promise. “It’s an intuitive model,” he says. “Backers have started to pose relevant questions. As my project proposal has made its way through social networks and attracted support from strangers, I’ve made some really fruitful new connections. In addition to generous funding contributions, several individuals have stepped forward with key contacts and very precise and helpful advice. I have already managed to make stronger photos due to their input. This is a pleasant shift over the lone-wolf existence.” The attraction of an initiatives such as Emphas.is are their transparency.
Jan Wyllie

Getting A Share- Equity-Based Crowdfunding [19Dec11] - 0 views

  • crowdfunding is different to many funding models in that it is based on the widest possible participation and tapping into “The Long Tail.” To do this, it has to reduce the barriers to participation, so it must reduce the friction and cost in the process and leverage the power of the networked engaged world where individuals are less constrained and able to re-imagine themselves into new roles, in this case as investors.
  • For the entrepreneurs looking for investment, you need to register also and submit a proposal, which then undergoes a checking process on the part of Crowdcube, who will decide to accept or reject it into the portfolio on offer.
  • So, the real innovation in crowdfunding beyond tapping into your tribe or casting the net a bit wider comes with the advent of turnkey platforms that open the field up to much wider groups of investors beyond the “certified high net worth” individuals- in other words, you and me.
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  • The model that Crowdcube operates requires that, as an investor, your register with the site and deposit an amount of money into a Crowdcube account. Once done, you can review the offers and bid on the portfolio of projects on the site.
  • e arguments for the regulation are primarily founded in the notion of risk mitigation and fraud prevention.
  • Minimum amount to be raised is currently £5,000, and there is no maximum, although Crowdcube suggest £150,000 as a typical maximum.
  • Minimum investment is £10, and transaction costs for companies raising money are relatively limited by comparison to a traditional equity sale process. Set legal costs are passed on to the entrepereneur, and Crowdcube takes a fee.
  • An alternative model is used by Symbid in the Netherlands, where they use a cooperative vehicle as the collecting mechanism for the investment- so pooling the individual contributions into a sole legal entity that invests in the entrepreneur. The idea of being in a club or community or having some buffer between the investor and entrepreneur seems key to meet the various restrictions in different geographies.
Jan Wyllie

The Crowdfunding Revolution: Making Your Choice [05May11] - 0 views

  • Crowdfunding is a natural fit for an independent game developer who needs to connect with an audience and secure funding at the same time; rather than having to "prove" your game to a publisher, you're "proving" it directly to your customers, and you don't have to go out on a limb funding it yourself with no idea of whether or not you'll sell enough copies to recoup your investment.
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