Comments on: Annals of dubious statistics, crowdfunding edition http://blogs.reuters.com/felix-salmon/2012/07/27/annals-of-dubious-statistics-crowdfunding-edition/ A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: expertcolor http://blogs.reuters.com/felix-salmon/2012/07/27/annals-of-dubious-statistics-crowdfunding-edition/comment-page-1/#comment-42232 Thu, 02 Aug 2012 13:43:28 +0000 http://blogs.reuters.com/felix-salmon/?p=16597#comment-42232 Here’s a comprehensive view and excellent commentary on crowdfunding by A. Brian Dengler, citing research from Wharton, Indiegogo, massolution and more:

“Crowdfunding Adds Up”: http://www.cfira.org/?p=856.

Also, here’s Somolend’s take in a blog post titled “Crowdfunding: One Size Doesn’t Fit All”: http://somolend.wordpress.com/2012/07/26  /crowdfunding-one-size-doesnt-fit-all/.

These debates are great and will help this very young and booming industry form around a common taxonomy.

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By: twintangibles http://blogs.reuters.com/felix-salmon/2012/07/27/annals-of-dubious-statistics-crowdfunding-edition/comment-page-1/#comment-42134 Mon, 30 Jul 2012 22:01:19 +0000 http://blogs.reuters.com/felix-salmon/?p=16597#comment-42134 The important thing to remember about crowdfunding is that small sums can have profound and exceptional value for small startups and entrepreneurs. The grosse figures are largely irrelevant and only important to old style thinkers. No one is arguing crowdfunding will replace traditional investment, it is complementary, but as an engine to drive entrepreneurship it is powerful and responds to a better lens of analysis than traditional venture capital. Indeed we are already finding the more infomed VCs sniffing around crowdfunding locations to find crowd validated models that they missed. Second and third round funders are going to have to come to terms with promising startups that have already sold equity to people whose investment model they don’t understand. If you want to find inflated numbers I suggest you look at the inflated salaries of the finance community who have single handedly decimated the economy with their own arrogant hubris. And what can you say about a commentator that believes in, and even uses, the notion of a memes – haven’t laughed as much in years!

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By: realist50 http://blogs.reuters.com/felix-salmon/2012/07/27/annals-of-dubious-statistics-crowdfunding-edition/comment-page-1/#comment-42111 Sun, 29 Jul 2012 18:23:37 +0000 http://blogs.reuters.com/felix-salmon/?p=16597#comment-42111 @JFierro – The JOBS act provides a new exemption from SEC registration and easing of current general solicitation rules to facilitate crowdfunding. It weakens or loosens existing securities laws. Whether or not that’s a good idea is open to debate, but that’s what it does.

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By: crowdfundingm http://blogs.reuters.com/felix-salmon/2012/07/27/annals-of-dubious-statistics-crowdfunding-edition/comment-page-1/#comment-42108 Sat, 28 Jul 2012 23:38:10 +0000 http://blogs.reuters.com/felix-salmon/?p=16597#comment-42108 Mr. Salmon, glad to see you’ve discovered the four basic types of crowdfunding. Yes, this word has multiple meanings as do many words.

This might help:
http://www.leverage-pr.com/blog/crowdfun ding-explained/

And, yes, sometimes financial analysts have to estimate revenue and the like. Makes it tough, don’t it?

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By: bdenglr http://blogs.reuters.com/felix-salmon/2012/07/27/annals-of-dubious-statistics-crowdfunding-edition/comment-page-1/#comment-42106 Sat, 28 Jul 2012 13:26:50 +0000 http://blogs.reuters.com/felix-salmon/?p=16597#comment-42106 Felix, thank you for your thoughtful article. However, there are some misunderstandings in your analysis. If I read your comments correctly, you discount lending-based crowdfunding in the final tally. Debt instruments typically are “securities,” and the intent under the JOBS Act is to permit crowdfunding with various forms of securities. So, lending-based crowdfunding probably belongs in the statistical mix. You also point out that current equity crowdfunding numbers make up only a small piece of the pie; however, the smaller number may be due to the fact that equity based crowdfunding won’t be permitted in the USA until the SEC promulgates regulations. The current numbers are derived from other countries where equity crowdfunding is permitted, so it’s also inaccurate to suggest that stats taken from smaller countries is an indication that the numbers really aren’t there for crowdfunding in the USA.

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By: JFierro http://blogs.reuters.com/felix-salmon/2012/07/27/annals-of-dubious-statistics-crowdfunding-edition/comment-page-1/#comment-42104 Sat, 28 Jul 2012 07:35:54 +0000 http://blogs.reuters.com/felix-salmon/?p=16597#comment-42104 Don’t understand the above comment. Isn’t investing in it of itself caveat emptor, i.e. there’s always a chance of losing everything. Just look at the facebook investors. They are under the old securities rules and they are getting reamed.

Securities laws aren’t being weakened by crowdfunding, they are just being updated based on the progression of technology. Nowadays, you can get a lot of information just by doing quick searches which back in the 80’s (when Reg D was adopted) was impossible or when the original securities act was adopted (back in the ’30s).

BTW, great post on the numbers. It’s always good to be cynical, but I believe one must also be open to new ideas.

In full disclosure, we run an equity-based crowdfunding portal (www.cielex.com).

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By: realist50 http://blogs.reuters.com/felix-salmon/2012/07/27/annals-of-dubious-statistics-crowdfunding-edition/comment-page-1/#comment-42094 Fri, 27 Jul 2012 21:39:11 +0000 http://blogs.reuters.com/felix-salmon/?p=16597#comment-42094 Good post, though frankly I’m more frightened if crowd funding does take off. I’d say that of late 2 of Felix’s top 10 topics are crowd funding and discussion of programs to reduce (or at least refi at lower rates) mortgage debt on underwater homes. My point being, if we’re not going to have a caveat emptor, deal with the consequences of one’s investment choices mindset, we shouldn’t weaken securities offering rules and consumer protection laws for things like crowd funding. Prosecute fraud, of course, but the nature of frauds is that the money is usually gone so recoveries are partial at best. I’m scared about the prospect of socializing crowd funding losses. In fairness, I’ll note that Felix has as a rule been skeptical of crowd funding.

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