Streams

Crowd-funding

Monday, July 25, 2011

Om Malik, founder of the gigaOM network, an online publishing company, and chief blogger for gigaom.com, discusses the success of Kickstarter and other crowd-funding tools--and what brand-new start-ups should think about in terms of funding.

Guests:

Om Malik

Comments [8]

BL from SF

SteveS from Jersey City:
It's not an investment. A 90-second glance at Kickstarter.com and its FAQ's and About page revealed that it's about pledges, not loans or investment.

Aug. 06 2011 09:48 PM
Steven Bennett from New rochelle, ny

Check out my kickstarter campaign. Cant get any backers. Don't know what the to do next. Im doing the facebook thing twitter too. Any ideas?http://www.kickstarter.com/projects/whatsinblossomspurse/whats-in-blossoms-purse

Jul. 27 2011 12:44 AM
Ettie Steg from New York

Thanks for the discussion about Kickstarter

It would be great if Om Malik would run a real-live get-together where people could actually come and learn about the process so as not to spin their wheels.

Or if WNYC could organize such a get-together. I'd be glad to help.

Jul. 25 2011 02:08 PM
Arthur Vincie from Astora, NY

I recently had mixed success with two IndieGoGo campaigns for my independent feature "Found In Time." Here's what I learned:
* Have a plan B in case you don't raise all you were hoping to (I had other sources of funding so the crowdfunding became a supplemental source);
* You have to promote the hell out of your campaign because there are so many out there;
* Keep in mind that this is NOT FREE money. Between the gifts you give to your funders, transaction fees from the crowdsourcing sites AND the fees from Paypal or Amazon payments, you should factor that you're going to lose 20-25% of your financing.
* Keep in touch with your funders. Let them know how things are going. They can turn into your biggest promoters once the film/album/product is ready for the marketplace. One of my crowdfunders eventually became a full-fledged investor.

Good luck!

Jul. 25 2011 12:13 PM
Meredith

These sites can be valuable, but to me, they often seem like a socially acceptable way to ask your friends and family for money. I've been asked by friends to contribute several times, and I don't think I've ever seen contributors who are not already acquaintances of the donees. How often do the donees attract funding from strangers?

Jul. 25 2011 12:02 PM
inquisigal from Brooklyn

I think there's a big difference between someone seeking funding for an independent film (which is not typically made with making money in mind) and someone who wants to raise money for a retail business.

That said, given how large and impersonal most banks are these days, I think it's perfectly fine to raise money this way. The donor gets to donate based on her or his desire help the creator bring their ideas into reality.

Jul. 25 2011 12:01 PM
SteveS from Jersey City

How is this different from securities underwriting and why is it not subject to securities laws?

Jul. 25 2011 11:58 AM
anonymous

One thing that concerns me about kickstarter is that fundraisers seem to skirt the truth about whether or not they're profit making entities. That's not to say one might choose to support someone with a worthy business idea but there should be more transparency in the descriptions.

Jul. 25 2011 11:36 AM

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