Huffington Post by Mark Fidelman | January 29, 2014

Photo: Huffington Post

If politicians were awarded Olympic medals, then Congressman Patrick McHenry (R-NC) and U.S. Senator Mark Warner (D-VA) would each be given gold in the crowdfunding biathlon for their sheer endurance and fortitude in helping create and deliver on a reasonable bill to allow any business to raise money via private markets. Instead of caving to special interests and Washington bureaucrats, both backed a bill that marks the beginning of a new era in finance.

The recognition that they and 98 other crowdfunding experts received last week for supporting what was previously seen as an impossible dream will help usher in a new wave of innovation and jobs.

But as with anything political, the fight continues. Most of the experts I talked to on the list acknowledged that the new Jobs act is imperfect and will need revisions if it is to be a real force in the future. But most also cited that using social networks and crowdsourcing support for these changes was a sure path to victory.

Related: 2014 Trends for Business Startups and Future Funders

Looking forward, I asked each of them for their thoughts on the path forward, here's what they told me:

1. Slava Rubin, CEO of Indiegogo (#3)

"Since its inception in 2008, crowdfunding remains an emerging industry and largely unknown in many parts of the world. As such, those in leadership positions in the space have a responsibility to collaborate, educate, and share with the public and one another on how best to move forward and revolutionize funding for good. Active engagement of community leaders, whether they're based in the government, the media, or the platforms themselves, is imperative to the evolution and future of crowdfunding."

2. Tim Draper, Venture capitalist; Founder of Draper University (#6)

"If you want to be a thought leader, you need a following. To be followed today, you need a social network. The world has great systems now to have the best ideas reach the most people."

3. Sen. Warner (#8)

"We're still waiting on final SEC rules, but I think there may be some interesting issues that will come up and will need to be resolved over time. We need to get a sense of how equity CF is going to work in the real world. There are a lot of variables."

4. Renaud LePlanche, Co-founder and CEO of Lending Club (#10)

"We're looking forward to watching equity crowdfunding develop -- and
seeing how the players solve the challenges of higher risk endeavors evaluated through unstructured data. Part of what made us successful is the ability to identify quality loans and get to scale (we originated $2 billion last year) so that a greater diversification can be offered to investors and performance becomes more predictable."

"How do you ensure the success and education of investors, absent industry standard metrics to evaluate risk, and how do you provide diversification across thousands or tens of thousands of projects? These are some of the challenges facing equity crowdfunding."

5. Sherwood (Woodie) Neiss, Partner at Crowdfund Capital Advisors (#12)

"The media will have a heyday when equity crowdfunding kicks off. They will tout this as 'Web 3.0' where the business case for the social network has finally arrived. They will try to identify the next Facebook which will really help bring exposure to the industry."

"However, given the caps that exist for companies (e.g., can only raise up to $1 million in 12 months) and investors (e.g., majority will be limited to five percent of their income or net worth), there won't be many herd mentality stories. This will come as a surprise to entrepreneurs who wish to seek funds via crowdfunding and face the harsh reality that although the process of raising capital has been streamlined via technology, raising money is still incredibly hard. There will be many companies (over 80 percent) that never hit their funding target."

6. Congressman Henry (#13)

"My hope is that equity crowdfunding emerges -- at home and abroad -- as a competitive source of capital for small businesses and viable investment choice for Americans. But for that to happen, the crowdfunding community must express its opinion(s) about the SEC's crowdfunding proposal to the Commission during the current comment period."

7. Kevin Steger, Founder of Startup Report (#14)

"The SEC will be slow to adopt the proposed rules around equity crowdfunding. This is already moving at a slow pace and there is no reason to expect that the pace will quicken. We may see equity crowdfunding in 2014, we may not. After the rules are adopted, I expect to see the investment community and start‐up community to embrace equity crowdfunding -- there are a lot of prospective investors who want to play in this space who aren't allowed to do so in the current regulatory environment. The new SEC rules would change all of that."

8. Devin Thorpe, Social entrepreneurship blogger for Forbes (#16)

"As investment crowdfunding blossoms over the next few years, stories of business failures will inevitably emerge. We all need to remember that starting a business has always been and will always be a challenge. Crowdfunding helps to close the funding gaps that entrepreneurs experience, but it generally can't solve operational problems. Let's remember not to panic when we hear the first horror stories. The stories of huge investor wins will not be far behind."

9. Kendell Americo, Founder and CEO of Fund Hub (#17)

"Equity crowdfunding will have a slower start than most people want or hope for, primarily because of the compliance and due diligence requirements the SEC has created. There are alot of hoops to jump through. Once people understand that equity crowdfunding is not as easy as creating a campaign on Kickstarter, but is actually raising money to start a real business and takes planning and an investment of time and money, then the real boom will begin."

10. Josh Constine, Technology journalist for TechCrunch (#23)

"In 2014, mediocre venture capital firms and angels will start to feel the burn of competition from equity crowdfunding competi. If these investors can't add value beyond providing cash, startup may prefer to raise money from the crowd to get an army of evangelists and recruiters."

Continue to the full list and article --> here

The National Crowdfunding Association of Canada (NCFA Canada) is a cross-Canada crowdfunding hub providing education, advocacy and networking opportunities in the rapidly evolving crowdfunding industry. NCFA Canada is a community-based, membership-driven entity that was formed at the grass roots level to fill a national need in the market place. Join our growing network of industry stakeholders, fundraisers and investors. Increase your organization’s profile and gain access to a dynamic group of industry front runners. Learn more eBrochure | Prezi or contact us at casano@ncfacanada.org.

PBS Idea Lab by Rodrigo Davies | December 4, 2013

The rise of civic crowdfunding — the use of crowdfunding to provide services to communities — has led to the emergence of several radical (and not-so-radical) visions of what the process of shaping the world around us could look like in the future.

As some of the earliest examples of civic crowdfunding on Kickstarter show, the process can be initiated entirely by individuals or for-profits. For other platforms such as Citizinvestor, projects need to be initiated by governments. But there’s a big missing piece in the public-private realm that is not adequately captured by either of these models: the organized non-profit space.

Related: Ten tips for running a successful crowdfunding campaign

In my view, the intersection of individuals (the crowd), the public sector, the for-profit and social sectors represents the most fruitful application of civic crowdfunding — bringing together the full spectrum of actors that influence the built environment and the resources that communities share.

Successful non-profits might be wondering whether they need to devote resources to crowdfunding. As one senior fundraiser at a public library-linked non-profit asked me: “Why spend months on an intensive campaign to raise thousands when I can have one in-person meeting with the right individual and raise a million dollars?”

Related:  What really happens after a Crowdfunding Campaign

The need for alternative fundraising methods clearly varies a lot across organizations. But even comfortable non-profits accept that crowdfunding has the potential to deliver a deep engagement between fundraisers and backers. And, as emergent civic crowdfunding models suggest, it has the potential to produce new alliances — creating a space for for-profits, the social sector, the public sector and individuals to be at the same table, working toward a common goal.

So what are the ways that non-profits can interface with civic crowdfunding as it stands? I’d like to propose three methods.

CAMPAIGN MANAGEMENT
The first method is campaign management. The organization takes responsibility for receiving and spending the money, using an existing platform. Two platforms that allow this approach are IndieGoGo and Spacehive; Kansas City-based Neighborly allows non-profits to post projects once they’ve passed through a vetting process. This is the most conventional, v1.0 model, and has been successfully executed by several groups. In April, the Chicago Parks Foundation raised $62,113 for the expansion of the city’s Windy City Hoops basketball social program on IndieGoGo.

The benefit of the “promoter” approach is that it gives the organization complete control over the messaging associated with the campaign. The drawbacks are that the organization also bears all of the risks of failure, and organizations with large existing funding sources will need to justify carefully why they’re asking for additional money.

CURATION
The second method is curation. The organization draws attention to crowdfunding projects that support its values or benefit its community, most likely by hosting a page on an existing crowdfunding website. New York City Council was one of the first organizations to adopt this model by creating a Kickstarter page, and the neighborhood of Tottenham, North London earlier this year partnered with Spacehive to promote projects by the local community.

As a curator, the organization can leverage the best grass-roots ideas in the communities they serve. It is also presumed to have exercised some degree of due diligence on the campaigns it promotes, and so is likely to be held partly responsible if campaigns fail to reach their funding targets or to fulfill their projects.

HOSTING
The third method is hosting. The organization hosts a crowdfunding campaign on its existing site or a dedicated campaign site. This could be a single project page using a widget for a payment platform such as WePay, although the organization would need a manual solution to handle the other affordances of crowdfunding (such as rewards, match-funding and funder profiling) or miss out on them altogether. The Long Now Foundation is using this model for its Salon campaign, which has raised just over half of its $495,000 target. For organizations hoping to host multiple campaigns or projects, the platform would probably be a white-label version of an existing paid service or an open-source solution, such as Catarse. Catarse is the most robust open-source codebase that is freely accessible, and has been used by 17 platforms to date.

Continue to the full article --> here

The National Crowdfunding Association of Canada (NCFA Canada) is a cross-Canada crowdfunding hub providing education, advocacy and networking opportunities in the rapidly evolving crowdfunding industry. NCFA Canada is a community-based, membership-driven entity that was formed at the grass roots level to fill a national need in the market place. Join our growing network of industry stakeholders, fundraisers and investors. Increase your organization’s profile and gain access to a dynamic group of industry front runners. Learn more eBrochure | Prezi or contact us at casano@ncfacanada.org.