Topic:

The Equity of the Crowds

The Equity of the Crowds

Congress Could Empower Crowdfunding Sites to Become Proper Mini-Investor Platforms

(flickr.com/kheelcenter)

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.¬† Read More