In the current frosty economic climate, many entrepreneurs and artists are finding themselves in a funding wasteland, waiting for fiscally brighter days when grants and investors are less tight-fisted. Thanks to the growing movement in crowdfunding, websites that match projects with a variety of investors, entrepreneurs and creatives can once again find the cash they need keep their dreams afloat.
For artists, Kickstarter is the online version of a fairy godmother. Artists propose a project to the public, and individuals can pledge any amount starting at $1 and increasing to more than $500. Every project sets a fundraising deadline. If the project meets its funding request within the allotted time, then the funders are charged and the project is underway. If the fundraising goal is not met, then no money changes hands, and the project proposal is removed from the site. Some of Kickstarter’s current projects include Words without Borders, an online magazine hoping to publish an issue on Afghani literature, and Chicken Fat 2011, a documentary on the MAD Magazine cartoonist, Will Elder. Because of Kickstarter, funding for these projects isn’t just a pipe dream; it’s a probability.
As helpful as Kickstarter is, entrepreneurs outside of traditional creative fields will have better luck finding crowdfunding at sites designed specifically for them. Seedsup, for example, connects entrepreneurs with investors willing to put up the initial cash needed to launch a business. Seedups entrepreneurs propose a business plan and have 90 days to connect with the website’s 51 investors, using interactive tools such as webinars to promote themselves. Founded in Ireland, the website is designed to help generate capital for small investment projects between €10,000 and €250,000. Still only in beta, the site uses algorithms to connect its investors with like-minded entrepreneurs the way interested singles review profiles on dating sites.
Kickstarter and Seedups are just the beginning of the crowdfunding revolution. Like all other innovations, crowdfunding technology will no doubt evolve to meet the needs of the public that uses it. In what areas is there still a great need for crowdfunding? How do we better connect investors with talented innovators struggling to bring their ideas to public?