Crowdfunding Is a Tool, Not a Game Changer

Article from AllBusiness.com

With crowdfunding legal in some states and taking place virtually everywhere, the spectrum has narrowed. It is plain to see how the movement is playing out in the immediate future. To start, crowdfunding is not a game changer. At most it is a tool used for offering equity, debt, preselling goods, production funds, and gifts. Kickstarter has proven the possibility of bringing people together to fund projects. However, that is much different in comparison to offering debt and equity.

In my opinion, the equity/ debt portion ( which is legal in the state of Georgia) forces those involved to rise to a certain professional level. That is the Catch 22 — only about 1-2 percent of ventures make it to the VC level — so I would have to guestimate that most crowdfunding businesses will not succeed, primarily due to the natural topography of business and management skills.

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