To Turn The Crowd Into Venture Capitalists, FundersClub Raises $6M Seed Round — Biggest In YC History. If you need more proof that FundersClub wants to radically change startup funding by letting non-VCs invest, it just closed a $6 million seed round, the largest ever from a Y Combinator company.
There are still questions about its legality, but investors include A-listers YC, First Round, Chris Dixon, and Aaron Levie. Their support shows Silicon Valley is ready to disrupt itself by inviting the crowd to the cap table. Democratizing Capital For those unfamiliar, FundersClub is a website that picks promising startups and lets people invest in them over the web in return for real equity. Anyone who’s an “accredited investor” (earns over $200,000 a year or has a net worth over $1 million) can browse startups with open rounds ranging from a few hundred thousand to a few million dollars. If one of the startups gets acquired or IPOs, the investors can cash out their stake and FundersClub collects a percentage. So far it’s been a hit. CircleUp Spinning on All Cylinders With Four Startups Funded. By Trevor Gilbert On August 22, 2012 CircleUp is one of the latest in a line of startups including FundersClub, MicroVentures, and AngelList that are looking to disrupt the venture capital industry.
The company profiles startups that are actively raising capital, and then connects the companies with accredited investors. Today, CircleUp is announcing that its platform has been used to successfully raise money for four startups. Instead of targeting technology startups, as might be expected, CircleUp so far has worked with companies taking on very different markets. The four companies — Episencial, Little Duck Organics, Melt, and 18 Rabbits – are gunning for things like the organic kids snacks industry and the natural baby skin care market. In addition, CircleUp’s platform introduces investors to companies that they wouldn’t have otherwise heard of.
But on top of the financial requirements, CircleUp also performs a number of other basic services to help out investors. Insider FundersClub, The Equity Crowdfunding Platform Destined To Redefine Venture Capital. Don’t call it Kickstarter, because on FundersClub you get real equity for your investments in hot startups.
In just three weeks since launch, FundersClub’s platform has pulled in $1 million for Y Combinator companies, closed an oversubscribed $500,000 round for itself, and proven there’s a new way for entrepreneurs to keep the lights on. Here’s a closer look at why FundersClub is so damn disruptive. Crowdfunding: One Size Doesn’t Fit All « SoMoLend. In this interesting article, Forbes asks the question ‘Is the Crowdfunding Bubble About to Burst?’
At SoMoLend, we certainly think so! We love that Forbes is recognizing the power of crowdfunding and the impact it will have on small businesses nationwide. The article references Kickstarter, a crowdfunding pioneer, as an example. However, it’s important to note that Kickstarter only represents one model of crowdfunding, reward-based, and it’s not the right model for every entrepreneur seeking funding. We’d like to take a moment to elaborate and provide some clarification about the different types of crowdfunding: 1) donation based crowdfunding; 2) reward-based crowdfunding; 3) equity-based crowdfunding and 4) lending-based crowdfunding.
Donation-Based Crowdfunding How it works: Crowds fund a project by donating money with no reward or financial return. Crowdfunding Explained- An In Depth Look. Microfinance Microfinance is when contributors align to provide financial services, often seemingly miniscule loans, to low-income clients.
Recipients generally lack access to banking services[ii]. Historic examples of microfinance include Swift Irish Loan Fund, and more recently, the March of Dimes. Crowdfunding - The Real Story. The excitement surrounding crowdfunding continues to grow.
I've written about it several times, and a lot of questions have been raised by our readers as a result. Recently one of those readers, Sam Houghton, who also happens to be an attorney focusing on finance-related issues, corporate structuring and ownership transfer at Clark, Campbell & Lancaster, P.A. in Lakeland, Florida, reached out to me to help clarify and explain the important issues surrounding the JOBS Act and it's implications for crowdfunding. Sam has spoken on the subject numerous times in the past couple of months at events focusing on the new legislation. He rung me up during a rare lapse in his schedule, and I think you'll find his insights valuable. Our discussion resulted in what I believe is one of the best primers on the reality of the JOBS Act and the likely impact on crowdfunding that I think you'll read anywhere. Sam: Sure, absolutely. Mark: So let's jump in. Sam: Sure. Is this author on the ball? (38 followers)
Should Equity-Based Crowd Funding Be Legal? Socialbakers. SoMoLend. SoMoLend is a web-based technology that allows small businesses to raise debt financing from friends, family, customers, neighors and local banks.
SoMoLend is the first of its kind in many ways as a fully transparent portal that allows investors to look into the eyes of business borrowers in their own neighborhood before making any lending decisions. 2012 Showcase Interview with Candace Klein, SoMoLend. CapRally. Crowdsourcing.org.