We have received this question a lot recently, “how is Return on Change different from the crowdfunding platforms that have already been around?”. Crowdfunding as a concept has existed for a long time. Politicians have utilized the method for campaign raises and charitable organizations for fundraisers. The name describes exactly what it is, funding from a large group. The power behind this lies in aggregation. Even though each individual party can provide a small amount of money that cannot do much on its own, when pooled together these small amounts grow into a large amount of money that can indeed go a long way.
Platforms that have existed to date have supported creative, philanthropic or non-profit and profit ventures. Supporters (donors) provide their commitments to support a specific campaign and are oftentimes ‘compensated’ by a product that is being manufactured or a mention of sorts if there are no actual products involved. People who pledge money for these projects, however, are UNABLE to ask for any kind of economic return and the founders are unable to even offer it.
To provide an example, if you have been watching the news recently, you have probably heard about Facebook’s IPO and the new group of millionaires that were created by it. The employees and financial supporters of Facebook were given stock (ownership in a company) in return for capital or labor. When Facebook IPO’d these people were able to sale their shares and subsequently benefited from the company that they supported from its early days.
The day crowdfunding exists today, regular everyday people weren’t able to give money and then ask for ownership in return (there are certain small exceptions) and companies weren’t permitted to go on the internet and let people know they were raising money without extensive reporting requirements to the SEC (veryyyy expensive process). Can you imagine you could potentially ‘support’ the next Facebook, but when they become wildly successful, you wouldn’t get anything in return.
This is all changing. Even the regular Joe (&Jane) is going to be able to invest in awesome startups. We aren’t all rich enough to invest like the professionals, but a lot of us putting small amounts can change the world.
I’m ready to crowd invest my way into tomorrow. Are you ready?