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What is CrowdSourcing and Business Process CrowdSourcing

posted Aug 27, 2012, 11:48 AM by David Khorram   [ updated Aug 27, 2012, 12:15 PM ]

Ok, You know what it means   Business Process Outsourcing  or BPO  . In IT industry , this means having access to staff that are contractors ( 1099 )  all over the USA via website such as http://www.fieldnation.com/  , http://www.onforce.com/      or many others .    This has changed. In Networking age you have access to the "Crowd " and you create "Crowd capital " or "Social Capital " .... ( Social Media expert they call this Social Media ROI ) 

Now,  you can have access to "Common crowd"  ( http://www.redbeacon.com )  or "expert crowd"  ( http://www.asonesource.com   - It deployment nationwide ) . This is called  Business Process CrwodSourcing. or BPC.

Watch this video   - http://goo.gl/x4zBJ

Just remember you know all about this but in "Information age" ..

In who wants to be a millionaire , the challenge is place to the contestant, he usually ask the "expert " for help  but collective audience response is % 85 more accurate than the expert . This is called "crowd collective intelligence "  . This is again not new , what is new then ?.... The supper computer in  our pockets ( cell  phone ) connecting all of us . 

I hope this covers it .  If you be interested I can show you the way to be relevant to all this information on daily bases ..  You know if you get update on any particular topic for more than a year , the you can be an expert on that topic .. This called collective CloudCrowd ! 

Watch this video :



As you see power is with crowd .   Crowd = 1.5 billion internet users in the world 


Crowdfunding Is a Tool to Change the Dynamics of Economic Downturn

posted Aug 8, 2012, 10:53 AM by David Khorram

Posted from : http://www.sbwire.com/press-releases/crowd-funding-register-event/sbwire-157706.htm

Santa Ana, CA -- (SBWIRE) -- 08/08/2012 -- Innova Global Technology and Irvine Chamber of Commerce are happy announce that the seminar and conference on CrowdFunding is to be conducted on 8-9-2012. Some of the luminaries from the field of Finance, Commerce and Business are slated to grace the conference and speak on topics of high significance. 

Among the speakers are Joseph Greco, Ph.D., Finance Professor- Mihaylo College of Business and Economics, Bryan Gianesin, Business and Securities Attorney, Gianesin Law Firm, Steve Gutierrez , Business Consultant - CrowdFundingMentors.com and Daniel Gutierrez, CEO & Co-Founder FundaGeek LLC. They are to bring up some pertinent points regarding capital and funding during the economic slowdown.

Select Business owners and Thought leaders are invited to participate in this summit which is sure to be of great value-add to entrepreneurs, start-up business owners and investors. Some of the key areas of deliberation and discourse are going to be non-traditional capital acquisition, the JOBS act, and whether it will bring any changes in the way employment generation and business is resourced for the future. 

Complete enactment of the JOBS act by 2013 will be a point of discussion.

Invitees stand to gain a lot in terms of fine-tuning their organizations’ vision, mission and objectives. Some of the current and short-term goals can also be revamped in line with the fresh approach that one gets to see at this summit. The agenda of the program itself gives a clear idea of what a participant can expect to gain by the time the conference concludes. Registration can be done online by visiting the following URL:CrowdFundingRegisterEvent.

The main objective of the program is to offer business people up-to-date information and expert views on Crowdfunding, giving ideas on how to raise capital, plan for budgeting from non-conventional resources and non-accredited investors. It has particularly sound ideas for small businesses to develop and improve their current business practices. There are also wise lessons and business principles to be absorbed from these talks.

Those interested in speaking at the conference are also welcome. A form can be filled out to enter their session ideas. This particular part of the session is open to the public, whereas the conference to be held at Irvine, California is only for those who have been sent invitations.

Register and get a unique take on conducting business, raising capital, and formulating business strategies. Contact http://www.crowdfundingconferenceseminar.com/contact-us or visitwww.CrowdFundingConferencesSeminar.com for additional information on the conference.

Equity Crowdfunding Portal EarlyShares.com Plans Nationwide Educational Roadshow Will Hit 24 Cities in 24 Weeks

posted Jul 7, 2012, 7:52 PM by David Khorram

Posted from:   http://www.marketwatch.com/story/equity-crowdfunding-portal-earlysharescom-plans-nationwide-educational-roadshow-2012-06-18

-Will Hit 24 Cities in 24 Weeks --First Stop TechWeek Chicago, June 22 To Co-Sponsor Popular Start-Up Competition --Winnings Will Include Up To $100,000 In Cash and Prizes As Well As The Opportunity to Raise $250,000 on EarlyShares.com at No Charge

MIAMI, June 18, 2012 /PRNewswire via COMTEX/ -- EarlyShares.com, the premiere Portal for Equity Based CrowdFunding, announced today that it will be going on a national roadshow by visiting 24 major cities in 24 weeks aimed to educate and raise much needed awareness about the JOBS Act and the benefits of equity based crowdfunding.

EarlyShares.com goal in each city is to bring this to the attention of the American people at the local business and entrepreneurial level in an informing, engaging and easy to understand way. They want to help everyone understand how to make this new form of investing work for them.

EarlyShares.com's roadshow begins in Chicago, Illinois on June 22nd where they are co-sponsors and participants in TechWeek, a week-long technology event. At the conference, EarlyShares is co-sponsoring TechWeek Launch, a start-up competition where one winning company will receive up to $100,000 in cash and prizes from conference sponsors. The winning company will also have the opportunity to raise an additional $250,000 on EarlyShares.com at no cost. That means simply that EarlyShares.com will waive all success fees (approx. $15,000) . Further, EarlyShares.com co-founder Maurice Lopes will also participate in a panel discussion on crowdfunding along with four other esteemed industry experts including Bill Hubbard, JD CPA, Director Chicago Chapter NLCFA (National Crowdfunding Association) who will provide a local perspective on crowdfunding; Sara Hanks, JD, Co-Chair of SEC Regulatory Committee and CEO at Crowdcheck who will cover the due diligence aspect of crowdfunding; and Douglas S Ellenoff, JD, Partner at Ellenoff Grossman & Schole LLP who will cover the legal aspect of crowdfunding.

"TechWeek Chicago is a great way to kick off the roadshow. The major 5-day event allows startups to gain valuable market awareness, and we're excited to be there and provide crowdfunding education," states Lopes.

Other cities currently lined up are StartUp Weekend (San Antonio, TX) on July 20, JOBS Act Investment Summit 2012 (Santa Clara, CA) on July 25, and New York City for eLuminate Network's TM Pitch CrowdFunding Conference 2012 on July 30th.

About EarlyShares.com

Formed in 2011, EarlyShares.com is the leading online equity crowdfunding portal. The company has created a secure, user-friendly platform to connect Entrepreneurs and the new investor class, average Americans. For entrepreneurs, EarlyShares provides a cost-effective way to fund their startups or expanding businesses. For average Americans, EarlyShares is a way to support great ideas and create new jobs by investing as little as $100 in companies they see potential in.

SOURCE EarlyShares.com

Want to raise a million dollars online? Then you want to hear about the JOBS Act and next year's big thing: crowd funding.

posted Jul 4, 2012, 8:24 PM by David Khorram   [ updated Jul 4, 2012, 8:24 PM ]

Posted from:  http://www.moneytalksnews.com/2012/07/04/crowd-funding-more-money-for-small-business/

Looking for ways to fund your startup? Join the crowd. Seriously.

Traditionally, small businesses have gone to banks for loans, but that’s tough to do these days. The stock market might be too big. And while there are special microloans for small business, what if that’s not enough money?

Try “crowd funding” – a new option for entrepreneurs coming as soon as next year. If the term sounds familiar, it probably is: Crowd-funding websites like KickstarterRocketHub and Indiegogo have been in the news recently for charity fundraisers and products people want to see.

And because of a new law called the Jumpstart Our Business Startups (JOBS) Act, funding portals like these will soon be able to offer small businesses something like a small-scale public offering: They’ll be able to raise cash directly from consumers in exchange for partial ownership.

In the video below, Money Talks News founder Stacy Johnson offers a quick overview on crowd funding and talks to a small business co-founder about how she might use it. Check it out, and then read on for more details…


As entrepreneur Miyah Haag suggested, small businesses could soon use crowd-funding sites to pay for everything from marketing to production. But how does it all work? And where did the law come from? Let’s tackle the latter first…

The JOBS Act

The idea for the bill initially grew out of recommendations from President Obama’s Startup America initiative last year – and was drafted by Republicans in the House of Representatives. It received rare bipartisan support and passed in April.

The law does a lot more than allow crowd funding. It also loosens many business regulations and makes other ways to raise capital easier. The U.S. Securities and Exchange Commission, the part of the federal government responsible for watching over Wall Street and enforcing securities laws, is still trying to figure out how this new fundraising model is going to work and how to protect investors. They’re currently establishing rules for business crowd-funding. (You can comment on the SEC’s website or read what others are saying.)

It’s not clear what the rules will be or when exactly they become effective, but since the law gives the SEC nine months to develop those rules, it will probably happen early next year. And we do know a few things already, based on the legislation itself

  • You can’t crowd-fund through your own website – only through approved portals.
  • Funding portals can’t directly handle the money and will need to register as a broker, find one, or use a bank.
  • They also won’t be able to make recommendations or promote particular projects, as some crowd-funding sites do now.
  • Investors who make less than $40,000 a year will be limited to investing $2,000 a year. Those who make $40,000 to $100,000 a year will be limited to investing 5 percent, and those who make more are capped at 10 percent with a maximum annual investment of $100,000.
  • Entrepreneurs who hold more than a 20 percent stake in the business they’re fundraising for will be subject to background checks by the funding portal.
  • Businesses with fundraising goals of more than $100,000 will have to submit tax returns and financial records. Those looking for more than $500,000 will also have to have those professionally audited.

How crowd funding works

You can already see crowd funding in action, just not for small businesses. Right now, websites like Kickstarter (which has seen more than $200 million in pledges and funded about 20,000 campaigns) let creative people looking for capital list projects (ranging from products to music and art) with a financial goal and a time limit. People who want to support those projects can back them by pledging a donation of their choosing.

If the project reaches its goal in the set timeframe, it gets funded with all of the money it raised, minus a cut for the platform, even if it’s way in excess of the stated goal. If it doesn’t meet the goal, the project gets nothing and the backers keep their money.

Get ready for crowdfunding 2.0

posted Jul 1, 2012, 12:28 PM by David Khorram

Posted from :  http://www.crainsnewyork.com/article/20120629/SMALLBIZ/120629864 

Since mid-June, Ben Powell's Manhattan firm, Motive LLC, has attracted more than $12,500 from 370-plus backers for its product, a stylus to handwrite notes and draw on the iPad.

Like other small businesses that have won over supporters through Kickstarter, a crowdfunding site for companies seeking to raise money online from individuals, Mr. Powell rewards backers with small gifts. Motive, for example, provides everything from a single black stylus for a donation of $20 or more to 10 styluses in a choice of four colors and a black leather Apple iPad Smart Cover for $500 or more.

With the passage last April of the Crowdfund Act, startups and small businesses now have the option of luring investors to back them by selling stock or raising capital through debt in their firms. The Securities and Exchange Commission is currently working on the rules for equity and debt-based crowdfunding, including how companies can use social networks to promote their capital-raising drives. The SEC is slated to present the new regulations in mid-January.

Considering the new options in crowdfunding? Here are some tips.

Be realistic. Crowdfunding isn't for every company. Before you invest time in it, consider how long it will take for you to bring your product or service to fruition and deliver a return to investors. That will affect how many takers you get for your offering. “It's about matching backers' investment timeline with the company's development timeline,” said Jason W. Best, a principal in Crowdfund Capital Advisors, which is headquartered in San Francisco and has a Manhattan office.

In the past, many small backers of crowdfunded ventures have been attracted by the small rewards that they get for making a donation, such as a signed CD by an artist they have supported. Entrepreneurs should consider “whether their product would be attractive as a reward,” noted Mr. Best. Do background checks. The law requires corporate officers to submit to securities-fraud and criminal-record checks, so companies need to do their own due diligence first to ensure there are “no bad actors” involved in the firm's crowdfunding efforts, said Mr. Best, who also serves as the co-founder of Crowdfund Intermediary Regulatory Advocates, a Manhattan-based self-regulating association for the crowdfunding industry and co-chair of the Crowdfunding Professional Association in Salt Lake City.

Prep the paperwork. To drum up investors, you'll need to be prepared with financial statements, a comprehensive business plan that includes how much capital the firm needs to achieve its objectives and a budget delineating how the money will be allocated, according to Sang Lee, founder and CEO of Return on Change, a Long Island City, Queens, firm with an equity crowdfunding site geared to socially conscious ventures and technology startups. “Transparency is key,” said Mr. Lee. “If you are spending money on nice monitors because your graphic designer needs them, put it out there. Don't try to be coy.”

Craft a compelling pitch. On crowdfunding websites, pitches abound—but investors are drawn to those that focus on the “why” of a new product and its impact on “society and the world,” said Brian Meece, CEO and founder of the 2-year-old RocketHub.com, a Harlem-headquartered crowdfunding site. Providing such information “will resonate” with contributors, he said.

Create a communication strategy. Small-fry investors' questions, complaints and suggestions can consume vital company time, so it's critical to manage their expectations. Keep them in the loop with monthly emails and quarterly newsletters, and assign a point person to handle investor relations. “You want to always speak with one voice,” said Mr. Best.



Read more: http://www.crainsnewyork.com/article/20120629/SMALLBIZ/120629864#ixzz1zOubtgFI

Crowdfunding - What succeeds, by how much and how often ?

posted Jul 1, 2012, 8:15 AM by David Khorram

Posted  from ;  http://gigaom.com/2012/06/28/analyzing-kickstarter-what-succeeds-by-how-much-and-how-often/

Analyzing Kickstarter: What succeeds, by how much and how often


When it comes to crowdfunding platforms, the biggest (or at least most well known) kid on the block is Kickstarter. So when the company announced last week it would release stats on the projects within its platform, the analyst in me got all excited. Like many, I’ve wanted more granular data on the breakdown of projects as well as which ones do better than others.

Using the baseline data Kickstarter provided, I did some analysis to better understand what projects succeed, the distribution of successful project categories by size, and at what point in the funding a project’s likelihood of success starts to go up significantly. Below are some of those results.

What categories rule today?

Below is a visual representation of how big each category is both in terms of successful projects and the funding raised. The size of the circle indicates relative size of aggregate funding for successful projects per category, while the vertical placement indicates how many successful projects each category has. While total project counts are even bigger than what’s shown here (there have been a total of 57,292 completed projects as of June 26), the chart does a good job of illustrating how each category is performing for projects that ultimately reach their funding target.

Total Successful Projects and Funding (US $ Millions) by Category

When you take a look at which projects rule, there is no doubt that music and film/video are the big dogs. This is not a surprise, given Kickstarter’s history and how the music and movie communities have been some of the earliest artist segments to embrace crowdfunding.

The interesting thing about looking at chart above, you start to understand, visually, how some categories tend to get bigger overall average funding. Design, for example, has only had 674 successful projects completed as of June 26, but the total funding raised for the category was $40 million, a much bigger aggregate revenue number (as indicated by the size of the circle) for other categories with a similar number of completed successful projects.

Distribution of projects by funding reached

Now, it should be noted that certain big projects – like the Pebble Watch project (which reached over $10 million) – tend to blow up the average project size, but even without the Pebble watch project, successful projects within design are more likely to be in a higher funding band than the average.

Percentage Distribution of Successful Projects by Funding Size 

Looking at the chart above, one can see that design, games and technology projects tend to have a higher share of their successful projects fall into the $20,000 and above, whereas some categories – like theater and art – see 90 percent of their projects fall under $10,000. Not surprising, when you think about it, as some types of creative work requires, quite simply, less capital.

The 30% rule, visualized

Yancey Strickler has written before about the 30% rule of Kickstarter, which in my conversation with other crowdfunding platforms seems to hold true, and often is the threshold when strangers outside of a fundraiser’s immediate network start to contribute to a campaign. With this in mind, I though it was very interesting that when I mapped out the the distribution of unsuccessful projects, the rule of 30% became very clear in the data.

Distribution of Unsuccessful Projects by Funding Threshold 

What happens, as can be seen by the above visualization, is that once projects hit that 20 percent funded threshold, they tend to hit a wall. And, by applying the rule of 30 percent, it becomes clear that once projects get over the hurdle of 20 percent funding and reach 30 percent or more of their funding target, the chance of reaching the funding goal grows exponentially. This is proven by the simple fact that there are a total of approximately 5 thousand projects that got past 20 percent of the funding target but didn’t succeed, but there are a total of over 25 thousand successful projects.

What this illustrates is that once you get around 30 percent funded, chances are much much higher (at Strickler points out) that you are going “jump the moat” to the promised land of successful projects.

If you’d like to see more analysis of Kickstarter’s data, the slides can be found here in SlideShare.

Wanted: small sums of money to finance young companies. Click here to invest

posted Jun 26, 2012, 10:06 AM by David Khorram   [ updated Jun 26, 2012, 10:07 AM by Unknown user ]

Posted from :  http://www.economist.com/node/21556973


PEBBLE, a watch that displays messages from the wearer’s iPhone, may not be a record-holder for long. The $10.3m raised last month from 68,929 people after Pebble’s inventors posted a pitch on Kickstarter, a “crowdfunding” website, dwarfed the previous high of $3.3m set in March by Double Fine Adventure, a video game (see chart 1). Until February, no project had raised $1m. Now seven have. This “feels like an inflection point”, says Yancey Strickler, a founder of Kickstarter, a site where anyone with an idea can ask the crowd for small sums of money that, added up, can bring it to fruition.

Crowdfunding is booming. A report by Massolution, a research firm, forecasts that $2.8 billion will be raised worldwide this year, up from $1.5 billion in 2011 and only $530m in 2009 (see chart 2). There are over 450 “crowdfunding platforms”, including four in China, up from under 100 in 2007, with Kickstarter America’s largest. This month Indiegogo, its closest rival (though global and with a broader mix of projects), secured the biggest chunk of venture capital so far for crowdfunding.

The effect of this has perhaps been most marked in the creative arts: around 10% of the films shown at the Sundance and Cannes festivals this year were crowdfunded, says Mr Strickler. Charity is benefiting, too. But America’s recent Jumpstart Our Business Start-ups (JOBS) Act is raising hopes that crowdfunding will also transform the way in which firms raise capital. Duncan Niederauer, the boss of NYSE Euronext, claims that, properly done, it “will become the future of how most small businesses are going to be financed”. Is the hype justified?

From fad to finance

Talk of crowdfunding as a short-lived fad has largely ceased, as evidence mounts that lots of people value personal engagement with projects they help to finance. “People increasingly want humanity with their technology,” says Caterina Fake, an early investor in Kickstarter. Hitherto people have opened their wallets for three main reasons: “caring about the person or company; wanting the product; or being part of a community,” says Slava Rubin, a founder of Indiegogo. Adding profit as a motive will bring fresh challenges.

Raising money from strangers requires a lot of effort to gain their trust. One indicator of credibility is “social proof”: projects that can raise 20-40% of their target amount from online “friends and family” do far better at getting strangers to contribute, says Mr Rubin. Videos also help. Campaigns with them raise over twice as much as those without.

Then, at least in the absence of a financial profit, there are the perks projects offer. These can range from “psychic rewards” such as being mentioned in a film’s credits to more tangible benefits: Emmy’s Organics, a firm singled out by Barack Obama when he signed the JOBS Act, tempted punters with promises of baked goodies.

Crowdfunding is well suited to industries that create intellectual property, says Hal Varian, Google’s chief economist. Instead of today’s approach of restricting access to content using copyright, crowdfunding facilitates an alternative, whereby the creator agrees to provide content if enough people commit themselves to paying for it. Mr Varian argues that this overcomes the free-rider problem, a particular pain for makers of online content because it can often be reproduced at zero cost.

Google has experimented by crowdfunding the development of new fonts for websites, at around $3,000 a time. It is a good way to test consumer demand, says Mr Varian. Mr Rubin expects more big companies to use crowdfunding, extending the recent trend for “co-creating” products with customers. GM, say, might crowdfund different tweaks to its vehicles, to see which ones customers want. Firms could let staff seek crowdfunding for their ideas and offer a top-up if they hit a target.

For big companies, raising money matters less than gaining information about customers or even good PR. For many smaller firms, money matters most. A small Main Street business trying to borrow $50,000-100,000 “cannot get that money from any bank in this country right now,” says Mr Niederauer. CircleUp, a new firm that raises equity for small business from a restricted crowd of sophisticated “accredited” investors (rather than the general public), sees a huge funding gap for firms with revenues of under $10m in industries such as consumer products. Since its launch in April, CircleUp has already beaten its targets for this year.

But what if firms could raise money from anyone? Fred Wilson, a prominent venture capitalist, calculates that if Americans used just 1% of their investable assets to crowdfund business they would release a $300 billion surge of capital. But will regulators, who worry about Joe Sixpack being ripped off by unscrupulous fund-raisers, allow the crowd in? The Securities and Exchange Commission (SEC) is trying to come up with rules to implement the JOBS Act. Some fear that it will impose onerous requirements on firms raising equity from the crowd.

Crowdfunding firms differ on the merits of this. Kickstarter has decided not to confuse its mission by adding the profit motive. “In Congress, everyone said the JOBS Act would mean Kickstarter for start-ups. But we are not going to do it,” says Mr Strickler. Indiegogo, by contrast, is keen. Prosper, a peer-to-peer lending firm, is undecided. SeedUps, an Irish start-up, is developing a three-tiered crowd—accredited investors; friends and family; and everyone else—to be ready for a launch in America once the SEC’s new rules take effect. In Britain, Crowdcube enables people to deploy up to £5,000 ($7,758) before having to register as sophisticated investors. In similar spirit, the JOBS Act tries to protect the public by limiting their investment in crowdfunding.

Fears of fraud may be overdone. Crowds may be harder to cheat than individuals. “On eBay, to sell something fraudulently, you need only fool one person. On Kickstarter, you have to fool a couple of thousand,” says Mr Strickler. Robert Litan of the Kauffman Foundation, a think-tank, believes experts will be able to add “proof of concept” to social proof. Perhaps leading venture-capital firms will return to financing baby start-ups, which they long ago abandoned. They would boost crowdfunding if, say, they lent their reputations to young firms and promised to invest later if they met certain targets. With so much promising experimentation in the works, Mr Litan says, “let’s just hope the SEC doesn’t kill it off before it gets

CFIRA Hosts Symposium to Jump Start Development of Crowdfunding Regulations

posted Jun 26, 2012, 9:20 AM by David Khorram   [ updated Jun 26, 2012, 9:20 AM by Unknown user ]

By: Dara Albright

NowStreet is proud to be helping organize the Crowdfunding industry's inaugural regulatory symposium

Inaugural symposium of lawmakers and crowdfunding experts to be held July 13 in Washington, D.C.

 

New York, NY -- (SBWIRE) -- 06/25/2012 -- Crowdfund Intermediary Regulatory Advocates (CFIRA) will hold a symposium in Washington, DC on July 13, 2012 to bring together lawmakers, regulators, and crowdfunding advocates. As the leading advocacy group for the crowdfunding industry, CFIRA invites these key constituents to come together and discuss the rules that will govern equity crowdfunding under the JOBS Act.

The JOBS Act, formally known as the Jumpstart Our Business Startups Act, became law on April 5, 2012, and opened the door for equity crowdfunding. The JOBS Act will enable small businesses to offer up to $1 million in equity to small investors through online crowdfunding portals. The JOBS Act gives the Securities & Exchange Commission (SEC) 270 days from April 5, 2012, to create rules that will govern equity crowdfunding. CFIRA is inviting key lawmakers who were instrumental in the passage of the JOBS Act, the SEC, and representatives from the Financial Industry Regulatory Authority (FINRA) to participate in the symposium. 

"We want to bring together regulators and legislators so they can build out the detailed regulatory framework for crowdfunding," said Freeman White, a member of CFIRA’s Executive Committee and CEO of Launcht. "The symposium is to help the SEC and FINRA continue their coordination and for the congressional sponsors of the JOBS Act to reiterate the legislative intent for the JOBS Act.”

“What we're really trying to accomplish is to help the regulators appreciate that they don't have to fear crowdfunding under the JOBS Act," said Dara Albright, a founding member of CFIRA and an organizer of the symposium.

Earlier this week, CFIRA's regulatory team met with members of the SEC to identify and review key issues in formulating regulations for crowdfunding. Key topics and developments included:

- review of CFIRA's suggestions on how issuers can advertise investment offerings using Facebook, Twitter, and other social media tools, which the SEC agreed to review. On May 21, 2012, CFIRA provided the SEC with recommendations on such solicitations; that letter can be reviewed at http://www.cfira.org/?p=168.

- The right for crowdfunding portals to refuse certain offerings, such as offers that may involve unlawful products, or offers that violate a portal's policies, like offers that may involve pornographic goods or services. Under discussion is a proposal that funding portals may refuse certain offers if the portal notifies users in advance of its criteria.

- Criteria that the crowdfunding portal may use to identify fraud.

- Whether the rule-making process and the crowdfunding provisions of the JOBS Act should apply to peer-to-peer lending and debt-based securities.

- CFIRA's proposal that search functionality on a funding portal, such as when users may search for offers related to a particular industry or business category, should not be deemed a form of investment advice.

- What advice crowdfunding portals may give to issuers who might post offerings on crowdfunding portals.

- CFIRA’s proposal that funding portals should be permitted to rely on representation and warranties that investors comply with the JOBS Act. CFIRA and the SEC also discussed the possibility of providing additional safe harbors to funding portals that voluntarily participate in a data program in which portals can verify an investor’s compliance with the law.

CFIRA agreed to follow up on the SEC's request for more input to discuss clearing and settlement procedures in closing crowdfunding transactions on funding portals. “To be clear, CFIRA’s role for the next 190 days of the 270-day rule-making period is, specifically, to serve as a voice of the industry with the appropriate regulators and to provide continuing regulatory education to the industry,” said Candace Klein, chair of CFIRA and founder of SoMoLend.com, a debt-based crowdfunding platform.

This week, CFIRA also urged members of the industry to provide assurance that their crowdfunding portals do not inadvertently—or prematurely—make equity offerings via a crowdfunding platform until the SEC adopts its rules. “CFIRA is committed to working with the SEC during the rule-making process and to informing the public that securities-based crowdfunding is neither legal nor permitted until this rule-making process is concluded,” said D.J. Paul, a member of CFIRA’s Executive Committee and co-founder and Chief Strategy Officer of crowdfunder.com.

Those interested in learning more about CFIRA can visit http://www.CFIRA.org. CFIRA also welcomes comments at CFIRA’s LinkedIn Group page.

Additionally, each Monday, those interested can join the CFIRA leadership group for a Live Chat at 9 am PDT / 12pm EDT / 5pm BST on Crowdsourcing.org. Post any questions to the group or topics you would like the group to address here:http://www.crowdsourcing.org/question/add. Follow this link to register or to read more about the Live Chat session: http://www.crowdsourcing.org/chat.

About CFIRA
Crowdfund Intermediary Regulatory Advocates, or CFIRA, was established following the signing of the Jumpstart Our Business Startups (JOBS) Act. CFIRA is an organization formed by the crowdfunding industry’s leading platforms and experts. The group will work with the Securities & Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and other affected governmental and quasi-governmental entities to help establish industry standards and best practices. For more information, visit http://www.CFIRA.org.

http://www.sbwire.com/press-releases/cfira-hosts-symposium-to-jump-start-development-of-crowdfunding-regulations-150129.htm

 

 

CONTACT: press@nowstreetevents.com

 

IS THERE A CRISIS IN VENTURE CAPITAL ?

posted Jun 24, 2012, 6:41 PM by David Khorram   [ updated Jun 24, 2012, 6:44 PM by Unknown user ]

Posted from : http://crowdfunding.trampolinesystems.com/

The global venture capital industry is currently in the most severe crisis of its history. According to Dow Jones VentureSource total investment fell by 36% in 2009. Outside the USA the picture is even bleaker with a fall of 51%. A consensus is emerging that this is a structural change, not just a cyclic phenomenon. A June 2009 report by the Kaufmann Foundation predicted that total assets under management by venture capital firms will contract by 50% from $24 billion to $12 billion over the next few years.

At the same time as the overall sums are shrinking, the pattern of investment is also changing. Funds have increased allocations to existing portfolio companies and focused new investments on lower-risk segments of the market. On the one hand funds are making small bets on seed-stage ventures. On the other hand they are making big investments in late-stage businesses that are either profitable or close to profitability. According to research by Deloitte:

“We’re seeing reduced investment levels as firms either invest smaller sums in very early-stage companies, or invest traditional sums in fewer and much later-stage companies. The middle ground has been largely vacated.

These changes are opening up a chasm in the £500,000 to £2 million financing range. Innovation is urgently needed to provide entrepreneurs with alternative ways to raise sums in this range. Trampoline believes crowdfunding is the best solution to bridge this funding gap and will become an established technique in the venture landscape.

CROWDFUNDING IN A NUTSHELL

Crowdfunding is an alternative approach to raising finance. It’s evolved over the last decade, first in the film and music industries, then in journalism and now in venture finance. Unlike traditional models which rely on large commitments from one or two institutions crowdfunding is based on raising smaller sums from lots of people, who may be linked by social networks or shared interests.

Wikipedia defines Crowdfunding as:

“an approach to raising the capital required for a new project or enterprise by appealing to large numbers of ordinary people for small donations. While such an approach has long precedents in the sphere of charity, it is receiving renewed attention from entrepreneurs such as independent film makers, now that social media and online communities make it possible to reach out to a group of potentially interested supporters at very low cost.”

This page provides examples of crowdfunding initiatives plus links to articles talking about crowdfunding.

EXAMPLES: MUSIC INDUSTRY

  • SellaBand is a service for musicians and bands to promote their work in an effort to gain “believers” who will help to fund the production and distribution of an album. Believers must raise $50,000 in order to graduate the artists into contractual agreements. Believers can earn money back from ad revenue used in tandem with giving away the music for free online at sellaband’s site.
  • Bandstocks provides a financial model for artists seeking an alternative to major labels. Funds for production and promotion are raised through “band stocks” purchased by fans in £10 units. Investors receive a copy of the album plus royalties from sales. Patrick Wolf is the most prominent artist to use the platform to date, raising £100,000 to release his album “The Bachelor” after leaving his contract with Polydor.
  • ArtistShare is a service for musicians to fund their projects outside the normal recording industry. It utilises micropayments to allow the general public to directly finance, and in some cases gain access to extra material from an artist. In 2004 Maria Schneider became the first artist to win a Grammy with an album distributed exclusively over the Internet. Distributed through ArtistShare she received four nominations for her albumConcert in the Garden and won Best Large Jazz Ensemble Album.
  • I Am Verity raised $80,000 from 2,000 fans in 25 countries to release an album and donate to women’s charities in South Africa.

EXAMPLES: FILM INDUSTRY

  • Artemis Eternal – Upcoming sci-fi short film being produced independently by Jessica Mae Stover. The user is invited, via the web, to donate (from $1 to $100) and join “The Wingmen” (whose members hail from students to homemakers to NASA employees and filmmakers) and help to crowdfund the project.
  • A Swarm of Angels is a project to utilize a swarm of subscribers (Angels) to help fund, make, contribute, and distribute a feature film using the internet and digital technologies. It aims to recruit earlier development community members with the right expertise into paid project members, film crew, and production staff.
  • “The Cosmonaut” is a feature film in which members of the public are invited from to become a “producer” with a minimum investment of €2. The project is licensed under Creative Commons’ Attribution-Sharealike so anybody can edit, remix, copy and freely distribute all the film materials which the creators have committed to publish in unedited HD.
  • IndieGoGo is an online social marketplace connecting filmmakers and fans to finance independent films. The platform provides filmmakers with tools for project funding, recruiting, and promotion; while enabling the audience to discover and connect directly with filmmakers and the causes they support. Since launching at the Sundance Festival in 2008 several projects have been financed through the platform.
  • Tangent is a video series whose production budget is partially paid for by its viewers. Through micro-funding, Creative Commons licensing, and shared IP ownership the project aims to establish an alternative financial model for online video.
  • Open Five is a Memphis-based film project raising $8,000 through crowdfunding to finance production.

EXAMPLES: OTHER INDUSTRIES

  • Spot.Us is non-profit pioneering community-funded journalism. Journalists pitch stories on the website which are then selected and financed through crowdfunding.
  • BeerBankroll is building a community-managed brewing company where members will make many of the business decisions. Members pay a subscription of $50 per year .
  • Blender Foundation is an Amsterdam-based venture that develops widely-used 3D animation software. Having started life as a commercial venture Blender raised €100,000 through a crowdfunding process and switched to an open source model.
  • Cameesa is the first site breaking into ‘Crowdfunding Fashion,’ where it encourages participation in the clothing creation process. Members decide which designs to print on T-shirts by supporting them financially. Once a design is 100% funded, the members who supported the design get a special edition of the t-shirt and earn a revenue share each time that design is purchased.
  • ActBlue is a US Federal Political Action Committee that enables individuals, local groups, and national organisations to fundraise for the Democratic candidates of their choice.By providing all the technical, financial, and compliance systems, ActBlue enables every progressive organization and individual to make the most of their networks, rapidly raising otherwise untapped millions for Democrats in the closest races.
  • Create A Fund allows both individuals and organizations to collect money online. The site tightly integrates with services like PayPal and Facebook to ensure a cohesive donor experience from start-to-finish. Fund creators get customizable ‘Donation Pages’ where donors can keep tabs on a fund’s progress, leave comments and invite others.
  • First Giving is a service that allows fundraisers to create online person-to-person fundraising pages for any US non-profit. The funds are directly transferred to the non-profit which differentiates firstgiving from other services.
  • PledgeBank while not exclusively for funding has often been used to crowdfund for projects and charities.
  • Fundable is a service allowing for the creation and management of fundable “group action” pages where pledges can be accepted. If a campaign does not reach its goal within a set time (14 or 25 days), then all pledges are negated and no money distributed.
  • Kickstarter is a New York start-up that helps other projects raise small amounts of finance through crowdfunding.

Links

A selection of articles discussing crowdfunding:

TIME Magazine article on crowdfunding (September 2008)

Business Week article on crowdfunding (July 2008)

Washington Post article on crowdfunding (August 2006)

NPR programme on crowdfunding in the music industry (September 2004)

Wikipedia article on crowdfunding

Crowdfunding Brings Start-Ups More Than Money

posted Jun 24, 2012, 9:07 AM by David Khorram   [ updated Jun 24, 2012, 9:07 AM by Unknown user ]

Repost :  http://it-jobs.fins.com/Articles/SBB0001424052702303448404577412632361774006/Crowdfunding-Brings-Start-Ups-More-Than-Money?goback=%2Egde_4415199_member_121774495 

Crowdfunding isn't just about the money.

Start-ups that use this kind of broad financing also get some valuable insight about how to run their businesses. While crowdfunding was once thought to just attract one-off projects for artists, recently founded sites like Kickstarter, IndieGoGo and Rockethub let founders test drive a part of their business model or create a prototype for a new product.

"Entrepreneurs are our fastest growing category," says Brian Meece, chief executive of Rockethub, which launched two years ago.

Not sure how to reap the benefits of crowdfunding opportunities? Here six advantages of crowdfunding your project:

You'll get proof of concept

Users speak with their wallets on crowdfunding sites, which can be the best indicator on whether they like or hate your idea or product.

"While money is a critical component, the biggest benefit is the validation of your idea," says Sherwood Neiss, Miami-based co-founder of start-up Exemption, a crowdfunding advocacy group. Sometimes the good news can give you more self-confidence to keep going rather than to move on to your next idea, especially if there's a pricey prototype involved.

Pebble Technology Corp., which makes a watch that works with iPhone and Android to receive data and use apps, set a new record when raising more than $10 million on Kickstarter this month. With more than 68,000 backers participating in the campaign, it's a definite green light for the makers and functions as proof of concept for any future venture capital funding the company pursues, says Rahul Bhagat, head of operations at Pebble.

You'll learn what potential customers really think

Not only can backers fund the project, the small ownership perks associated with each campaign can help you get valuable feedback on what works and what doesn't. "It's kind of like a mega focus group," says Steve McGuigan, co-founder of BitBanger Labs. "Potential consumers have more input into the product at an earlier stage."

Bitbanger's Lucid Dreaming Mask raised more than $550,000 on Kickstarter through crowdfunding. The mask tracks when someone is in deep REM sleep. Among other things, the company's 6,300 backers suggested the mask be made thinner.

Pebble's Bhagat says that they learned what customers value in the watch through the comments section. "Battery life, outdoor readability, and cost seem to be major driving factors in the backing," he explains. "In addition to that we have great market research that shows what features and apps people want and what they're willing to pay for."

You'll get a lesson in sales and marketing

Whether building your online video to earnestly explain your idea or communicating with potential backers, entrepreneurs find that crowdfunding lets them develop their marketing and sales experience. Not only do entrepreneurs need to come up with a good idea, they need to sell their project while tapping in to the social capital of their community, points out Rockethub's Meece. Thinking about your sales and marketing messages early on can help you continue to develop your project with the customer in mind.

You'll know the size of your costumer base

Especially if you're making a pricey product, knowing exactly how many people are buying your product is key, says Pebble's Bhagat. "It is very painful to over-produce product because you've used up capital that is just sitting as inventory," he points out. When contributing money to the campaign, users made contributions that covered the cost of a Pebble watch and pre-ordered the product directly from Kickstarter, each paying $99 for the watch, which has a retail price of $150.

You'll get organized early on

Having investors to report to means you'll need to create a short version of your business plan from the beginning, says Neiss. As the process continues, you'll need to share more and more of your internal plans with those who have contributed in an efficient manner and learn which information to keep private. After your idea is funded, you'll need to file your plans with the Securites and Exchange Commission. Having to constantly report your progress and keep track of your spending helps entrepreneurs establish "organization skills that are good for any business," says Neiss.

You'll get ideas for future projects

Crowdfunded projects give start-ups insight into what customers would like to see next, says Christopher Williams, coordinator at Barrio Works, a neighborhood ministry in Phoenix that built a campaign on Indiegogo. "You get to learn about the types of folks who are interested in your project [and] what other types of projects they are interested in," he says. "Hopefully [you are] satisfying customers who will be happy to buy from you again in the future."

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