There has been some debate amongst the North American investment community about whether the legalization of equity crowdfunding would unleash a new wave of clever fraudsters on an unsuspecting public. Recently, the Ontario Securities Commission (OSC) published newly proposed exemptions to become available to certain investors, including a proposed crowdfunding exemption. The proposed framework, which is likely to become law after a 90 day consultation period, seeks to strike a balance between protecting the public and embracing the inevitable investment paradigm shift to crowdfunding. The OSC has found a convenient middleman on which to place the burden of ensuring that offerings are in fact Continue reading
The Dynamics of Rewards v. Equity and Their Impact on Future Crowdfunding Campaigns
As we move towards the allowance of equity crowdfunding in North America and elsewhere, parties seeking to crowdfund ventures will want to give serious consideration to the dynamics and impact of offering rewards or an equity stake in the venture being funded. Going forward, for the reasons outlined herein, one expects that more and more, future campaigns will have a creative blend of both, depending on the project being funded.
Rewards of course can be Continue reading
Have you ever heard the saying “bet on the jockey, not the horse”? It means savvy investors will invest in an “A” team (the jockey) and a “B” technology (the horse) but not the other way around.
(1) Strong background: When marketing your product in advance of your crowdfunding launch, make sure to highlight the experience and background of your team. If your management team experience is weak, that’s okay if your product Continue reading
Last Saturday, February 15th, Kickstarter, revealed that it had been hacked. While the hackers did not obtain users’ credit card information, it was announced that “accessed information included usernames, email addresses, mailing addresses, phone numbers and encrypted passwords.”
What does this mean for crowdfunding?Continue reading