Crowdfunding social ventures

Liam and Peter have a post up on the Nesta Impact Investment blog asking whether crowdfunding can work for social ventures. It’s a very good explanation of the issues you might face if you’re thinking about doing it.

We’ve just watched Fairphone do incredibly well by using crowdfunding for pre-sales but I have to admit I’m a bit sceptical about equity crowdfunding at the moment. Ownership is a about much more than raising money. When you’re very early stage you need a very trusting relationship with your investors — one that can’t really be codified in legal speak or a set of terms and conditions — and I worry that’s difficult if you have a large group of investors with different motivations for backing you.

Having said that I don’t have direct experience of a startup that has done it yet — maybe my opinion will change if I get the chance to see how it really works.
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Crowdfunding space exploration

Not a lot of people know that Groupon started out life as a project to try and put a giant inflatable banana into orbit over Texas, but it did. When I first saw Andrew Mason pitch, the idea was called ThePoint and it was essentially an early version of Kickstarter whereby projects would only get funded if they reached a particular target. Â The banana project was going to cost $1.5 million.

Now the dream of putting things into space using crowdfunding seems to be coming true (not inflatable bananas yet, but it can only be a matter of time). There are quite a few projects putting CubeSats, weather balloons and other micro spacecraft into orbit and I met the people behind a project in Bristol last week that is even more ambitious and due to announce in the next few weeks. It seems that not even the most monolithic of industries can resist the crowd.
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