Among the many new technology products and services revealed at this year’s CES, perhaps none has gotten more press coverage than Dish’s new Sling TV service. As multiple outlets have reported, this $20 per month subscription service gives subscribers access to TNT, TBS, CNN, Food Network, HGTV, Cartoon Network, Adult Swim, the Disney Channel, ESPN and ESPN2 — without the… Read More
Rubber Band Gatling Gun is on Its Way Before we get to anything else, do you remember about a year ago when I backed that Kickstarter rubber band gun project? No, not THAT little rubber band…Read More →
There are major changes afoot in advertising technology at the moment, but not everyone has realized how transformational these changes are. Indeed, analysts have talked about four types of business models in the ad tech ecosystem, but have not discussed the underlying innovation that is driving the more leveraged of these models. Read More
Editor’s Note: Thinking about starting a crowdfunding campaign but don’t know where to begin? Check out the advice column below from Rose Spinelli, a crowdfunding campaign consultant who runs The Crowdfundamentals and was named as a top 100 crowdfunding thought leader. Rose is answering questions from the crowd about raising cash via rewards-based crowdfunding. You can submit your own questions to Rose via tweet, Facebook or Google Plus comment, or leaving it in the comments below. You can find her previous tips here.
The question, via Twitter:
Andrew Heard: Hey Rose, thanks for the info on crowdfunding for an event. Can you speak about the importance of launch parties and themes next?
Throwing launch parties is an underutilized crowdfunding strategy. Maybe that’s because crowdfunding happens online and face time can seem antithetical to that. Plus, by definition, it’s going to be local. But ignoring the idea is a missed opportunity, it’s great that you’re exploring this option.
Live events can technically serve as “soft launches,” with your friends, family and supporters getting the kind of buy-in you want right out of the gate. Moving forward in your campaign, this could be crucial to garnering endorsements from invitees’ circles, perhaps even providing the kinds of introductions to influencers that are so coveted in crowdfunding.
I know Heard from LinkedIn groups and on social media so contacted him for more deets.
Here’s how he further elaborated on his question:
I’m wondering about the logistics and/or problems of throwing a physical launch party. For example, is it better to throw a free party to shore up personal connections or throw a party with a price and use the money to make the campaign better?
Free vs. paid entry?
I definitely would not charge to attend. People might interpret a door charge to be their contribution, or just feel that they’ve already done their part. The idea is to lure and excite. So while you should try to get as much donated as possible, make sure to plan a line item in your budget for food and beverage costs, party space, if necessary — and anything thing else you might plan to keep the proceedings fun while keeping the promotion of your campaign front and center all the while. And if you get the word out to local reporters and bloggers, offering free canapés and cocktails just may tip the scales in favor of attendance.
The other potential landmine of a door charge is how exactly to apply that money you receive at the party to your campaign. Sure, you could tack it on to your total take, but you would likely be collecting cash or checks, right? If so, you won’t be able to add it towards your crowdfunding campaign goal because platform rules don’t allow project creators to contribute to their own campaigns, which is essentially how it would look to the platform if you, say, pocketed the cash and checks and used your personal credit card or Amazon or PayPal accounts to cover it. That’s a no-no.
Best of both worlds?
One fun thing you can consider doing, however, is to project your live campaign from your computer and offer folks an opportunity to sign in as themselves, pull out their own credit cards and contribute on the spot! You could make it a fun countdown kind of thing. (Think fundraising a là PBS or NPR.)
Heard also added:
I’m looking into partnering with a charity for the launch parties and possibly the campaign itself to give charitable tax receipts for the tickets, etc. but I’m worried about the effect it might have on my core supporter’s ability to contribute to the actual campaign.
Who cashes in?
We’ve already established you shouldn’t charge for your launch party so you won’t be able to offer charitable tax receipts. (And in my opinion, people don’t go to fundraising events just to nab a tax receipt.)
I happen to know that Heard’s project is an inspirational web series in which Heard plays a superhero who gives to charities through crowdfunding, which is great. But even so, this is your night, and it is in your charities’ best interest to support your efforts so that through your success you can help raise money for them in the future. So the money should go into your coffer and your charities, if representatives attend, should be fundraising on your behalf that night.
Here’s a cautionary tale: You’ll want to carefully read your platform’s guidelines to make sure you are abiding by its rules or risk being shut down.
A while back I wrote a blog post that involved a filmmaker who held a live event. He’d invited a local politician who decided to attend because the filmmaker was Latino, as was the politician, who wanted to speechify about how great it was that a young Latino was finding great success in his industry.
Except Kickstarter clearly states that project creators cannot endorse political parties. The filmmaker insists he did not endorse the politician, and whether this was the reason the campaign was shut down remains a mystery — because Kickstarter stayed mum, as they can be maddeningly wont to do. You can read the whole sad story here.
The moral of that story is, Keep your eyes open (and your nose clean by the platforms’ standards) and not only can you hope for a great campaign kickoff but some potentially lucrative ripple effects.Read More →
When Amazon launched its $199 connected speaker Amazon Echo last month, which plays music, news, radio and more as well as respond to commands and queries via its included virtual assistant technology, it also came with a dedicated mobile app for configurations and other settings. The app was initially available only for Amazon’s Fire OS and Android, but not iOS. Instead, iPhone and… Read More
Amazon and Google might be chest-thumping about their respective drone delivery programs but the technology is still years out from being feasible in dense urban environments. Dr Mirko Kovac, director of Imperial College London’s current aerial robotics lab, suggests it could be as far out as a decade. Read More
The next frontier of hardware is in your kitchen. Drop hopes to be a part of that connected experience with a kitchen scale and an iPad app that uses Bluetooth technology to take you step-by-step through hundreds of curated recipes.
It’s an Irish invention that has been on pre-sale all summer long. It’s now available for purchase in the U.S., the U.K., Canada and Europe for $99.95. Read More
The following is a guest post from Scott Picken, the founder and CEO of Wealth Migrate, a global real estate crowdfunding portal. Disclosure: Wealth Migrate is a client of Crowdsourcing.org / Massolution.
In 1999, Warren Buffett was quoted as being a skeptic of the hyped-up technology stocks everyone was piling into. Explaining his reticence to jump on the bandwagon, he pointed out that over 2000 car makes became available “in an industry that had an incredible impact on people’s lives. If you had foreseen in the early days of cars how this industry would develop, you would have said, ‘Here is the road to riches.’” In the end, however, only three major auto manufacturers prevailed.
That year, everyone believed that the internet would change business forever, and the increasing number of tech IPOs and skyrocketing stock prices were testaments to this. However, as Buffett had alluded to, valuations of these companies were not based on fundamentals or tried-and-tested business principles.
At the time, many investment bankers and analysts indicated these principles didn’t matter as much anymore, that times had changed. Well, we all know how this story ended: the “dot-com” bubble burst in 2000-2001 and only a select few tech companies, like Amazon and eBay, survived the fallout. Buffett knew that the auto industry provided a cautionary warning, but few had paid attention to history.
Real Estate and Crowdfunding: A Match Made in Heaven?
It is one thing to be in front of a monumental industry change, but another to understand the fundamentals of that industry and to execute on the opportunities it presents. Today, investment crowdfunding has taken off in the US, UK, Europe, Australia, Asia, South Africa, and other markets around the world, opening up access to capital and allowing investors more control than ever over their portfolios. Real estate is one of the most popular industries among new crowdfunding platforms catering to investors searching for ever-higher yields. The coupling of crowdfunding and real estate investing from a marketing perspective makes complete sense.
However, as with most new technological advances, there are skeptics who believe this new way of raising money online is problematic and investors will end up bilked out of their investment capital. With memories of the real estate market collapse of 2007-2008 still fresh, crowdfunding for real estate has become a particular target for the naysayers.
Unfortunately, they have a point.
There are now thousands of crowdfunding platforms around the world, many of them dedicated to real estate. Moreover, a September report industry analysts Crowdnetic showed that two of the three top sectors for “accredited investor” crowdfunding raises under Title II of the JOBS Act in the US are real estate related, proving real estate crowdfunding’s growing popularity.
Having spoken at multiple real estate crowdfunding conferences around the US and the world, I’m increasingly hearing certain verbiage and trends in this space that are cause for concern. First, the conflation of the terms “curating” and “due diligence.” It is true that a reputable real estate platform will perform due diligence on every opportunity and therefore be “curating,” in a sense, the best deals on their site. However, as the last internet bubble showed, it can be tempting to find ways to take shortcuts or make the numbers sound more impressive than they are in order to attract venture capital, which could well happen under the guise of “curation.” This article is a clarion call to industry leaders, founders and other stakeholders to not let that happen.
Secondly, a key area that is a cause of concern is that many, if not most, real estate platforms do not have “skin in the game,” as some like to call it. These platforms act as matchmakers between investors and syndicators without putting their money into their own deals. It would follow, then, that the interests of such platforms could gravitate toward trying to upload as many deals as possible in the immediate short term, as this is how they generate revenue. Meanwhile, investors are primarily interested in how much money they make in the long run. Therefore, interests are not aligned between the parties, which could give platforms an incentive to offer riskier deals than they normally would present to investors. Speculators are not investing based on the fundamentals and in all this excitement, many have forgotten the basis upon which wealth is created and preserved in real estate.
While the market is still on the rebound, this dynamic will be fine. As a billionaire real estate investor once told me, “Even a turkey can fly in a hurricane.” In real estate, there is a long tail of two to five years. If you buy something on eBay, you know within a few days if the supplier has integrity and whether you can keep doing business with them. In real estate, it can take several years to establish this kind of relationship. When the market turns, platforms whose interests are not explicitly aligned with their investor communities will be tempted to blame their own real estate syndicators and sponsors. Meanwhile, investors will be left to fend for themselves. Regulatory authorities are likely to play a major part in the aftermath, as has happened to the traditional banking sector with Dodd-Frank and other rules and regulations.
What Investors Should Look For in a Platform
Those real estate crowdfunding sites that had substantial real estate experience prior to the advent of crowdfunding will be the ones who most likely can ensure that they are building quality marketplaces. Portals like Prodigy, Fundrise, Carlton, CoAssets, and Wealth Migrate (of which I am the founder and CEO) are all run by teams of people who originally specialized in real estate and then embraced technology.
These platforms do not focus necessarily on securing deals with the best name recognition or publicity value, but keep an eye on the fundamentals: the quality of the partners, CAP rates, management teams, vacancy trends, financing metrics, IRR, macro- and microeconomic considerations, sector trends and most importantly, managing risk and wealth preservation. They are less worried about crowdfunding a ‘sexy’ hotel and would rather focus on investments that are going to offer long-term growth and income.
Even before we launched our global platform, we found success for ourselves and our investor base by focusing on areas that were weathering the recessionary years better than others. Australia, for example, never officially entered into a recession, and its real estate values actually started rising while other countries’ property markets collapsed. Armed with this knowledge, a philosophy of partnering with locals to benefit from their expertise, and implementing a proprietary system for managing project risk, we were able to achieve great success.
Where Do We Go From Here?
Real estate crowdfunding has by far and away had the greatest growth since the SEC amended Regulation D rules in September 2013 to allow for general solicitation of accredited investors in the US. While the market grows, early adopters should be cognizant of the inherent risks in this industry, think carefully about each platform’s due diligence process, and assess whether its business model incentivizes its management to truly have their investors’ best interests in mind.
Wealth Migrate’s founders and management team have facilitated 10,780 international investments and been trusted to invest $1.34 billion internationally for over three decades. We are passionate about educating both investors and real estate providers on safety and what they need to know, which is why we have actively engaged with Massolution (Crowdsourcing.org’s sister firm) to develop a comprehensive real estate crowdfunding industry report, scheduled for release at the end of this year. We will also be presenting our findings at some of the biggest global real estate conferences like MIPIM Asia 2014 and MIPIM Europe 2015.
Just like the automobile revolutionized transportation, crowdfunding is going to revolutionize real estate investing. The more quickly both seasoned and new real estate investors understand how the process works, the faster they can use it to their advantage, diversify their holdings and benefit from still-recovering real estate markets around the world.
Scott Picken is the founder and CEO of Wealth Migrate, the leading global real estate crowdfunding platform, and the author of “Property Going Global.” View Crowdsourcing.org’s recent profile of Wealth Migrate to learn more about the company.Read More →
3 Ways to Use CrowdFunding for Market Research | Huffington PostAre you hoping to fund the creation of a new piece of video game technology? Or is your goal to help launch a financial startup business? Whatever your objective is, it is necessary to support it with the right form of content; failing to do so may hurt your campaign.
USC launches campus crowdfunding website | Daily TrojanThe program, dubbed Ignite USC, is a combination of the famed Trojan Family network and crowdfunding websites such as Kickstarter. It aims to serve as a way for students and faculty to raise funding for meaningful projects that might not otherwise get exposure. Donations to projects will be counted toward the university’s campaign to raise $6 billion in funds. Projects will receive 100 percent of donations earned.
What If Your Crowdfunding Campaign Doesn’t Raise Enough Money? | SmallBizTrendsOne of the main reasons they were so far off was a particularly expensive pledge the game developer made to backers. The company had promised to make a documentary about its game creation process, among other perks. With so many more backers than expected, shipping of the documentary alone cost $250,000 because it had to be shipped internationally to 87,000 supporters. The film production costs for the documentary were another half million.
How Crowdsourcing Will Help Startups Build Their Own Versions of Siri | WiredThat’s why he started Wit.ai, a service that helps developers pool their voice samples together to power a speech and natural language recognition system that Lebrun hopes will soon rival the depth and breadth of the tools available to the likes of Apple and Google. In the years to come, this could become an important thing, as developers build the next wave of technologies that require speech interfaces, such as internet-connected appliances and wearable devices that don’t have screens.
Crowdsource everything, from dating to web design to fortune telling, with this Japanese startup | Tech In AsiaFor Coconala, crowdsourcing does not need to be limited to the workplace. Some of the usual freelance work is listed, but there is also treasure trove of other offered services, often for things like personal consulting. You can get advice on topics as various as fashion choices, restaurant picks, fun hobbies, and child rearing. Psychological and love counseling are two other categories as well. Love, predictably, is complex and has numerous subcategories like “looking hot,” “non-heterosexual,” “getting married,” “problems in marriage.” Users wanting to get married but also wanting to avoid the problems of married life might want to purchase some time with one of the fortune tellers listed on the site.
Why The Collaborative Economy Is Changing Everything | ForbesIt’s true, that the terms “sharing” or “collaborative economy” are being quite overused to encompass pretty much any and every single thing you think of, and that causes a lot of confusion. For example many of the things that fall under the sharing economy are what we used to simply call “renting,” now it seems as though any business that is aiming to target a consumer of any kind somehow gets labeled as being a part of the “sharing economy.” However over time this will be ironed out and clarified as the market matures.
How the Sharing Economy Is Changing Your Halloween Costume Search | Huffington PostWith only weeks to go before Halloween night, many of us are dusting off old costumes or looking to buy or create new outfits. There are more options than ever now to get one thanks to the Internet. Many people go to one of those Halloween pop-up stores that appear in our local shopping malls this time of year. Others turn to Amazon or other online stores to find the right costume. Now, the emergence of the online sharing economy is giving people still another option that a few years ago wasn’t available.
Open innovation important in promoting prosperity: Li Keqiang | Daily TimesAs economic globalization and informatization advance, all countries need to work together to achieve multiplication of knowledge and value through innovation cooperation, so as to solve development problems and promote common prosperity, Chinese Premier Li Keqiang has said.Innovation has become a new propeller for the development of mankind, Li said at an international forum themed on innovation, adding that the world, undergoing profound changes, calls for innovation in large scale and at deep level.Read More →