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Crowdfunding Components & Risk Assessment

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TaimoorZ
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Re: interesting idea
TaimoorZ   2/19/2013 6:22:12 AM
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"I think it's early in the arc of crowdfunding for our industry, however, Adapteva Kickstarter project was a success, so I anticipate more."

@Brian: Did these companies receive multiple rounds of funding through the crowdsourcing methods? Did the confidence from the investors remain stagnant throughout? Also, what about the quality of returns on such projects?

TaimoorZ
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Re: We need a Better measure of ROI
TaimoorZ   2/19/2013 6:20:49 AM
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I think the problem with issuing shares to the public is that the company needs to be a public-listed entity if it wants to float a large number of shares in the market. Normally, companies tend to be private for the initial period and later go for IPO once they're successful. This is why I believe the crowfunding idea cannot work with the shares model.

TaimoorZ
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Timing Issue
TaimoorZ   2/19/2013 6:18:40 AM
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@Brian: Don't you think convincing the public about a certain idea and then gathering funds from them can take a considerable amount of time? Would it not be much quicker to get funding from a single VC or a few of them? Have the companies you mentioned faced this issue?

Brian Fuller
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Re: interesting idea
Brian Fuller   2/18/2013 5:48:18 PM
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@flyingscot, the only two examples I've come across so far are Adapteva and Elliott Small's endeavor, both referenced in the story.

I think it's early in the arc of crowdfunding for our industry, however, Adapteva Kickstarter project was a success, so I anticipate more.

Let us know if you come across any!

 

FLYINGSCOT
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interesting idea
FLYINGSCOT   2/18/2013 4:46:44 PM
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I have heard of crowdfunding for things like small personal loans to higher risk people but never really seen crowdfundind applied to successful electronics companies.  Are there any good examples of companies that started this way and are now at the next stage of company development?

Brian Fuller
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Re: We need a Better measure of ROI
Brian Fuller   2/18/2013 3:10:00 PM
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Ashish, excellent suggestion. I'll put that on my list of posts for the week... 

Thank you!

 

tech4people
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Re: We need a Better measure of ROI
tech4people   2/18/2013 3:07:34 PM
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Brian,

Can I make a request?

Can you do a a followup post for this Blog on the topic of  Obama's JOBS act?

I believe Crowdfunding plays a very vital role in that act.

Many Thanks

Ashish.

 

Brian Fuller
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Re: We need a Better measure of ROI
Brian Fuller   2/18/2013 3:03:23 PM
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Ashish, I think that's part of it, but the other driver is the fact that VCs just aren't funding electronics ideas the way they used to. Semi/electronics startups are seen as more expensive propositions (compared with pure software plays) with longer return cycles. 

But I think your shares concept is a good one once the community figures out the legal issues surrounding that. Right now it's a lot easier if your "shares" come in the form of a prototype or early-access product. 

 

prabhakar_deosthali
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Re:
prabhakar_deosthali   2/18/2013 12:11:41 AM
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I do support the idea of crowd funding as it provides the required capital to convert an idea into a salable product . As against the venture funding or equity allotment, there will be no undue pressure or interference from the crown funding to the creative design team and that gives the total freedom for the tech people to work their way to the product.

tech4people
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Re: We need a Better measure of ROI
tech4people   2/17/2013 10:18:10 AM
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Mr Roques,

I like the idea too.

It just adds more variety to the list of Fund-raising Option available to American Entepreneurs today.

That's just the way I look at it.

If you have actually given a Sales Pitch to a VC or Angel Investor;then you know how difficult it to raise funds from those two sources.

Also,now with Banks having reduced Lending to unconventional sources sharply since the recession started in 2008;They have become more selective in which assets they invest in.

In that scenario it makes sense for Crowdfunding to pick up atleast some of the Slack that these VCs have given up on.

 

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