When Lawyers Send Letters
Popular webcomic The Oatmeal has reportedly been threatened with a lawsuit for making allegedly defamatory statements about FunnyJunk.com. Did the threat work? No, not at all, as of this writing.
FunnyJunk is a site with which Oatmeal creator Matthew Inman has some history. In response to the demand for $20,000 in damages, Mr. Inman proposed raising $20,000 on on Indiegogo, which he has pledged to donate to the National Wildlife Federation and the American Cancer Society. The project hit $20,000 in 64 minutes and is up to $25,000 with 15 days left to go. How do you like them oats?
Crowdfunding platform Indiegogo just raised $15 million from venture capital investors in order to staff up, build out and take on Kickstarter and 400 other competitors (including one crowdfunding platform that launched after raising money on Indiegogo). “We launched in January 2008 and we’ve been growing pretty steadily,” founder and CEO Slava Rubin told Betabeat from some unspecified location in New York. “We want to improve the product to make it easier and better to have campaign owners get discovered and get more funding.”
Do you feel like there are a lot of startups? We feel like there are a lot of startups. The JOBS Act, an amalgamation of six bills that passed through Congress, is likely going to make even more startups, thanks to a section that will allow the average American to invest limited amounts of money in business plans. AngelList, the crowdfunding platform Indiegogo, and a crop of equity-based crowdfunding platforms are poised to take advantage—but not for a while. The Act requires the SEC to hammer out the rules for equity-based crowdfunding within nine months.
“The SEC needs to determine the actual guidelines,” said Nick Tommarello, one of the founders of WeFunder, an equity-based crowdfunding platform that decided to launch a preliminary site before the law passed. “Then we apply to the SEC.”
In this Internetty bubble we so rarely leave, it’s easy to forget that millions of people in urban areas are within range of a functioning WiFi connection, but can’t necessarily afford it. New York-based startup KeyWiFi wants to help change that, by allowing individuals to rent out their unused WiFi connections for a nominal fee to those who can’t afford Internet.
the startup rundown
WICKA WICKA. Turntable.fm is in the big leagues now as the young music based social platform signs deals with Sony BMG, Universal, EMI and Warner, TechCrunch reports. Turntable has over one million users now and a new mobile app since September.
HIPSTARTER. San Francisco based Indiegogo, a crowdfunding platform with offices in Soho that competes with Kickstarter, announced the perfection of their “gogofactor,” a proprietary algorithm that ranks projects based on popularity and viability. This makes Indiegogo the only crowdfunding platform with this type of merit-based ranking functionality. Your move, Kickstarter.
The Equity of the Crowds
Bad news for IndieGoGo and other startups that want to be allowed to solicit up to $1 million in investment from the crowd. The bill that would allow companies to ask openly for investments in installments of just $1,000 or less has slowed down in the Senate over concerns with the protection of small-time investors. The bill, introduced by Massachussetts senator, the Libertarian-leaning Scott Brown, is being targeted by groups like the North American Securities Administrators Association Inc., which says the bill would promote the fleecing of unsavvy investors.
Proponents say social media ensures that scammers will be outed in short order.
The Equity of the Crowds
With 407 votes last week, the U.S. House of Representatives passed a bill (Entrepreneur Access to Capital Act, H.R. 2930), that would allow an SEC exemption for crowdfunding sites, whereby entrepreneurs could raise up to $2 million in exchange for equity from small-time investors.
As it stands, crowdfunding sites like Kickstarter (NYC) and IndieGoGo (NYC and SF) host projects that accept donations with no promise of monetary remuneration. Kickstarter and IndieGoGo investors are paid back in chip clips, early access, memorabilia, and other favors from the project’s creators, sort of like an NPR fundraising drive.
Occupy the Internet
Um, wow. There is a new initiative by the Free Network Foundation to build a private network for Occupy Wall Street and its affiliated movements in other cities. “We are the Free Network Foundation, builders and advocates of distributed and decentralized communication systems. We believe that the Internet should be used to connect people, not to spy on them, oppress them, or turn a profit,” says co-founder and executive director Isaac Wilder.
Occupy Wall Street
Kickstarter brought in
$30,000 $75,690 for the Occupied Wall Street Journal; now competiting crowdfunder IndieGoGo has brought in more than $2,000 for a campaign to give the protesters suits to wear on Oct. 15.