Thursday, March 7, 2013

Crowdsource Funding Fundamentally Changes the Game


One of the most important and exciting developments in the last year was the 2012 JOBS Act, which sets up clearing houses for a new type of business funding called CROWDFUNDING. This is a break from the historic public stock market, in which investors had to be "Qualified" to buy principle shares in a private corporation. SEC rules limit investors in most corporations to friends and family plus wealthy investors who self-qualify with large personal incomes and assets that make them virtually indestructible financially. 

The purpose of these regulations was theoretically to protect small investors from the common kinds of stock investment scams that many of our capitalist Wall Street types are well schooled. Ponzi Schemes look innocent compared to the kind of 'business investments' that can fool the novice investor, if such laws were not in place. However, the effect of these strict SEC accredited investor qualifications was to lock the average person out of the most lucrative capital markets. Making it impossible for the poor to benefit from our ever growing capitalist economy by investing in start-up companies. 
The Rocky Mountain Institue now informs us about the next alterative, an exciting crowd-sourced funding plan, an example of which is a little company called Mosaic. Our future is bright, if you are smart.
From Forbes to FortuneBloomberg to the Wall Street Journal, a young company named Mosaic has been getting a lot of attention of late. Why? Because Mosaic is bringing crowd-sourced funding to the world of solar PV.
Crowdfunding is nothing new. Companies such as Kickstarter have allowed individuals to fund everything from their next indie film to extensive out of pocket medical bills with pooled donations from family, friends, and other supporters. But thanks to last year’s JOBS Act, debt-based crowdfunding is now an option as well, in which investors come together to fund startups and small businesses in return for repayment plus interest from a company like Mosaic.
It’s inclusive, meaning that investors of all shapes and sizes can get into the game. And it currently makes for a good, low-risk investment. Mosaic—with more than $1.1 million invested in solar projects to date—boasts 4.5–6.5% risk-adjusted annual returns, besting the latest interest rates on 30-year Treasury bonds.  READ MORE ...

2 comments:

  1. All those relatives you approached told you they would love to give you money for your new business but just don't have it right now.
    It's the same story over and over again, but they have expenses of their own to cover and
    investing in a new business is just too risky. Your new idea is a sure winner, but you have to
    convince everyone else of that fact.

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