Crowdfunding, flip book, FILM260

1. Crowdfunding
By: Kevin Fei
cc: aresauburn™ - https://www.flickr.com/photos/9993075@N06

2. Crowdfunding is defined as the practice of
funding a project or venture by raising many
small amounts of money from a large number of
people, typically via the Internet. [1]
cc: Daniel Dudek-Corrigan -https://www.flickr.com/photos/57296780@N05

3. cc: Nrbelex -https://www.flickr.com/photos/91351004@N00
Just how powerful is crowdfunding?
A total of $16 billion were generated by the
crowdfunding industry in 2014, and an estimated
$34 billion were raised in 2015. In comparison,
the venture capital industry invests an average of
$30 billion each year. [2]

4. While many people criticize crowdfunding,
crowdfunding is in fact, extremely beneficial for
social movements, scientific researches as well as
new startups.
cc: tim caynes- https://www.flickr.com/photos/70021771@N00

5. One of the most frequent criticism
of crowdfunding is the risk of fraud
and ill-conceived projects. [3]
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6. cc: jovike - https://www.flickr.com/photos/49503078599@N01
Putting together a proposal that is attractive to the public does not have to be
as scientificallyrobust as putting an application into a panel of experts.
— Richard Gray [4]

7. However, this risk can be mitigated by
choosing crowdfunding portals that are of
good repute and (users can) take steps
themselves to prevent fraud. [5]
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8. The benefits of crowdfunding outweigh the risks.
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9. 1. Crowdfunding allows for the
fundraising of many good social
causes that would otherwise be
impossible to achieve.
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10. Ivy League students struggling to pay tuition posted about
their financial situation and appealed for crowdfunding
through social media. [4] Gabriela Riquelme, a student
crowdfunded $1,700 in just two days. [6]
cc: shawncalhoun - https://www.flickr.com/photos/35886662@N02

11. James Robertson, a 56-year-old Detroit man
who spent years taking two buses and walking
21 miles round trip to get to his factory job every
day, received funding from more than 13,000
people who pitched in to help him buy a car. [7]
cc: chris.chabot -https://www.flickr.com/photos/11311685@N02

12. After receiving a fund 7 times the original goal on Indiegogo, Kite Patch is
now able to distribute their insect deterring net to Uganda, which is
heavily affected by mosquito-borne illnesses. [8]
cc: Trocaire - https://www.flickr.com/photos/8485582@N07

13. Most relief funds now use
crowdfunding due to its
simplicity and convenience. [9]
cc: theleticiabertin-https://www.flickr.com/photos/56141117@N02

14. 2. Crowdfunding complements the current
funding structure from governments and
institutions to allow more scientific
researches to be conducted.
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15. As research budgets tighten at universities and federal financing
agencies, the competition is getting intense for the money
remains. [4] As a result, scientists are turning to crowds on the web
to finance their projects that would otherwise be overlooked. [10]
cc: SalFalko - https://www.flickr.com/photos/57567419@N00

16. Dr. David Kipping, a British astronomer now
based at Harvard, has raised funds to help his
search to find the first exomoon – a moon that
orbits a planet in another solar system. [11]
cc: write_adam - https://www.flickr.com/photos/8269775@N05

17. SciFund Challenge, has allowed nearly 200 researchers to
raise an average of $2,000 for 159 different projects. As
well, hundreds of projects on RocketHub have raised up to
half a million dollars each. [11]
cc: r.nial.bradshaw - https://www.flickr.com/photos/33227787@N05

18. 3. Crowdfunding provides the initial
capital for new startups to begin
its business operations.
cc: MDGovpics - https://www.flickr.com/photos/64018555@N03

19. Therefore, crowdfunding provides opportunity for new
startups through financial backings.
cc: Tim Pearce, Los Gatos - https://www.flickr.com/photos/42937777@N00
The probability of an average new business getting venture
capital is about 0.05%, meaning 99.95% of entrepreneurs will
not get the initial business funding at startup. [12]

20. The Oculus Rift virtual reality headset raised $2.4 million on
Kickstarter, which allowed the company to build
development kits of the headset. Two years later they were
purchased by Facebook for $2 billion. [13]
cc: Sergey Galyonkin - https://www.flickr.com/photos/22974618@N00

21. Startup smartwatch company Pebble, raised over $1 million
in an hour on the crowdfunding website Kickstarter from
people eager to get their hands on its products. [14]

22. cc: Gueorgui Tcherednitchenko -https://www.flickr.com/photos/49722723@N00
"Vanhawks was among the fortunate ones, easily exceeding its goal
and raising $820,000 from Kickstarter donors to become the biggest
Canadian Crowdfunding campaign to date in 2014.” [15]

23. To conclude, although criticisms and
skepticism still continues, the major
concern (i.e. risk of fraud) of users can be
minimized by using reliable websites and
gaining a thorough understanding of the
campaign.
Moreover, the benefits of crowdfunding
such as contributing to social causes,
funding for scientific researches, and
capitalizing new startups exceed the
existing criticisms. As a result,
crowdfunding is both valuable and
advantageous for our society.
cc: wili_hybrid - https://www.flickr.com/photos/62223880@N00

24. Works Cited
cc: Sam Ilić -https://www.flickr.com/photos/40195741@N00
1. Prive, Tanya. What Is Crowdfunding And How Does It Benefit The Economy. Forbes. Forbes Magazine, 27 Nov. 2012.
Web. 05 June 2016.
2. Barnett, Chance. Trends Show Crowdfunding To Surpass VC In 2016. Forbes. Forbes Magazine, 9 June 2015. Web. 05
June 2016.
3. Max, Tucker. How Crowdfunding Will Change The World, Part 6: The Risks (and Criticisms) of Crowdfunding. Tucker
Max. N.p., n.d. Web. 05 June 2016.
4. Matrix, Sidneyeve. "Module 04 Social Good." Vimeo. N.p., n.d. Web. 05 June 2016.
5. Caldbeck, Ryan. The Biggest Crowdfunding Criticisms. Forbes. Forbes Magazine, 20 Oct. 2013. Web. 05 June 2016.
6. Blackman, Andrew. "Tuition due? Time to Hit Up Everyone You Know; Crowdsourcing Allows Students to Raise Part of
the Money with a Little Help from their Friends." Wall Street Journal (Online)Nov 02 2015. ProQuest. Web. 4 June
2016
7. Singletary, Michelle. The Problem with Crowdfunding: It Doesn't Help the Needy Crowd. Washington Post. The
Washington Post, 20 Feb. 2015. Web. 05 June 2016.
8. 7 Incredibly Successful Crowdfunding Campaigns - Goodnet. Goodnet. N.p., 10 Sept. 2013. Web. 05 June 2016.
9. Gruberg, Shabab. Crowdfunding May Be a Game Changer for Disaster Relief Organizations - Good360. Good360 RSS.
N.p., 12 Jan. 2016. Web. 05 June 2016.
10. Lin, Thomas. Scientists Turn to Crowds on the Web to Finance Their Projects. The New York Times. The New York
Times, 11 July 2011. Web. 05 June 2016.
11. Gray, Richard. Crowdfunded Science: Harnessing the Wisdom of the Crowd, or Selling Out? The Guardian. Guardian
News and Media, 02 Jan. 2015. Web. 05 June 2016.
12. Rao, Dileep. Why 99.95% Of Entrepreneurs Should Stop Wasting Time Seeking Venture Capital. Forbes. Forbes
Magazine, 22 July 2013. Web. 05 June 2016.
13. Jeffries, Adrianne. If You Back a Kickstarter Project That Sells for $2 Billion, Do You Deserve to Get Rich? The Verge.
N.p., 28 Mar. 2014. Web. 05 June 2016.
14. Metz, Rachel. How Pebble Is Killing It on Kickstarter. MIT Technology Review. N.p., 02 June 2016. Web. 05 June 2016.
15. Lewis, Michael. Majority of Kickstarter Campaigns Fail despite High-profile Successes like Vanhawks | Toronto Star.
Thestar.com. N.p., 2 May 2016. Web. 05 June 2016.