The Age of Crowdfunding

Adam Haeder

 

Since kickstarter.com became the poster child for crowdfunding websites with it’s launch in 2009, the idea of directly asking internet­enabled citizens to support your project/gadget/movie/art/idea with their dollars is on everyone’s radar. Why embrace the old model of courting venture capital firms, or, worse yet, actually having to talk to a bank to get a loan for your venture? Just convince the public that what you’re doing is worthwhile, and for a small fee, they can help you bring it to light.

 

Crowdfunding is not a new concept ­ in 1884 the pedestal that holds the Statue of Liberty had to be crowdfunded when the American Committee for the Statue of Liberty ran out of funds. Six months and $100,000 later, over 125,000 people had donated money, with an average donation totaling less than a dollar, and Lady Liberty had a place to stand.

 

So even though we’ve seen the concept around in one form or another for more than a century, it’s been changed in revolutionary ways by that great equalizer, the internet. With a few clicks, the web­savvy potential donor can find literally thousands of products or projects to donate money to, on sites such as the aforementioned kickstarter.com, IndieGoGo, Fundly, GoFundMe and Hatchfund, to name just a few.

 

What does the funder get out of this? Often, they get some special access or recognition for their efforts. If you’re backing a pending product or gadget, your contribution might entitle you to a beta or early release version of the device. If it’s an art project you’re contributing to, you might be mentioned on the artist’s website or in a press release, or perhaps even get a signed copy of an original from the artist themselves. However, it seem that in most high­profile campaigns, the funders are simply doing what the economists keep telling us that the fair market does so well: they are voting with their dollars. The list of most funded projects on the larger crowd­funding sites is a telling glimpse into what’s hot, not necessarily right now, but maybe 6 months from now. For example, the Hatchfund.org Most Popular page (http://www.hatchfund.org/projects) has examples of the most popular up­and­coming art projects. The Pebble Watch project opened for funding on April 11, 2012, and has raised over $10 million from over 68,000 people. Apparently there are a lot of people that really want a smartwatch that can sync with their smartphone. Since early 2012, Apple, Samsung and Sony have all announced smartwatch products, with only Sony’s available at the moment. Similarly, the most funded project in the Technology section is the Form 1 professional 3d printer, started in September 2012. 3d printing is all the rage in the DIY­maker section of the tech world now, and as these devices break the $500 price barrier, they are getting more and more mainstream exposure.

 

So keep an eye on these crowdfunding sites as you’re looking to see what’s hot in technology, movies, art or fashion in the coming months. You might find the next big thing waiting to get to market. And you might even have the privilege of helping them get there.

 

For more information about AIM’s crowdfunding platform, visit http://www.hatchfund.org