‘Third-Level Survivorship’ in Crowdfunding

Mike Gonzalez April 21, 2013 Comments Off on ‘Third-Level Survivorship’ in Crowdfunding

Editor’s Note: We continue our look at the leading industry research and advisory work that our sister organization massolution is engaged in. The piece below is just a sampling of a presentation from a recent workshop massolution helped to organize for its client, the Multilateral Investment Fund of the Inter-American Development Bank. For more information on massolution and its industry research, go to crowdsourcing.org/research; for services, visit massolution.com. The introductory piece in this series, discussing the ‘engagement effect’ in crowdfunding, is here.
Crowdfunding has already demonstrated its ability to create economic impact in the startup and emerging companies sectors.
It is providing the seed funding that has enabled thousands of new companies to launch. And, small and medium size businesses have been able to raise millions of dollars in growth financing through crowdfunding.
Crowdfunding has changed the lives of many people that successfully raised funds to support caused-based initiatives. Consider, for example, Kerfluffles Marshmallows, which raised over $100,000 — well above the initial $2,000 goal. This success enabled the campaign owner to lease a commercial kitchen space, launch an online store to sell her treats, and hire employees to help with the baking.
In 2011, there were over 1.1 million successful campaigns, raising $1.47 billion worldwide across the four categories of crowdfunding (reward-, debt-, donation- and equity-based). Individual successes such as Kerfluffles Marshmallows and thousands of others have caught the attention of large enterprises and organizations who wish to better understand how crowdfunding can be applied on a much larger scale.
Crowdfunding’s success as a viable, scalable alternative to public and private finance has implications for how governments set jobs policy, frame economic development programs, and leverage public investments. It also affects how companies raise finance, interact with their lead customers, and validate their R&D outputs.
One group thinking about crowdfunding on a mass scale is the Multilateral

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