Crowdfunding is a great but frightening development.
It’s great, and necessary, and obvious, just like democracy and freedom of speech.
But it’s not frightening because it threatens the VC‘s. I’m worried because the first wave of crowd ‘investors’ will inevitably do mistakes that VC’s have learned to avoid, this might cause much capital being allocated in wrong places, causing rouge behavior from ‘startups’ and render huge disappointments, amplified by media, making entrepreneurship a bad word.
there, i’ve said it. funding startups is a serious thing, not a game of tax evasion.
Venture capitalists have been getting a black eye to go with their blue shirts. A recent report from the Kauffman Foundation slammed VCs for “shortchanging” investors, pointing out that public markets deliver better returns.
somehow all this reminds me of elaborate public grants infrastructure in Europe, that’s causing half of economy to focus on filling out checkboxes rather than listening to customers. not sure why, but it feels like the same instrument in different clothes.
- Venture capital’s new golden age (finance.fortune.cnn.com)
- With Crowdfunding Legal, Incubators Are the New VC’s (bostinno.com)
- First Equity-based Crowdfunding Portal Opens its Doors to Businesses (sacbee.com)
- Fred Wilson: what crowdfunding means for the VC business (gigaom.com)