One of the thought leaders in alternative finance & crowdfunding, Victoria Silchenko met up with Crowdfund Insider to talk about alternative finance. Of the whole interview, which is accessible here, Oliver* reports an excerpt on equity crowdfunding and a metaphysical question.
One might assume that after so many years of anticipation and quite rich coverage by the media the crowd, AKA the new generation of financiers, would rush to platforms that offer a piece of equity rather than t-shirts.
However we’ve got a very slow start where May – October 2016 the crowd invested just a little over $11 million (with WeFunder as the leading platform controlling 70% of market share).
I’ve found this fact to be quite fascinating asking myself a metaphysical question: are we all motivated by a keen desire to help “bring creative projects to life” rather than investing with a goal of potentially making some money?
So the companies that are raising capital and pitching themselves to equity CF platforms should remember that when it goes to start-up financing, people are rather looking for impactful and Good companies. With a capital G. Just ask millennials—who will account for 75% of the workforce in 2025. There are plenty of reports confirming they are not motivated by money but rather impact and sustainability.
Meanwhile, from what I observe the platform owners have an extremely hard time finding high quality projects – in fact, most of the platforms have recently started to offer so called “scout programs” with up to $2,500 in fees for a company referral.
But I am still optimistic and you know why? Because I believe wiring the public finance and investment possibilities via the Internet is a very natural – and crucial step in the new digitalized economy and we needed to re-write the rules. The key thing to remember – for the first time in financing history, the founders and entrepreneurs can build their brand’s loyalty via customer stock ownership.
(Via: Crowdfund Insider)