Crowdfunding

NVP

Legendary member
37,768 2,101
hey all....

Crowdfunding (for profit).....is one of the new on-trend mediums capturing the business worlds imagination

and a natural backlash to those nasty greedy banking types .....:whistling

so I wanted to launch a new thread dedicated to discussiong this medium

happy to discuss anything

best sites
experiences as an investor and/or a beneficiary
pro's / cons / risks / Benefits
any current Venures you are looking at and want comments / advice
are you trying to raise funding ?

I preferably want to stick to the profit based sites as this is a business Forum and not a charity....sorry ;)

ok.........over to you guys

N
 

YouAreNotFree

Experienced member
1,295 225
I'm all for it, although admittedly I don't know much about crowd funding. Anything that removes what I consider to be the crony capitalist banks from the equation is a good thing imo.

I like the idea of P2P lending too. I have a few K at one of those sites just to show my support.
 

wackypete2

Legendary member
10,229 2,055
I admit I had to google crownfunding to find out what is was so if I sound like an idiot then you know why :)

I preferably want to stick to the profit based sites as this is a business Forum and not a charity....sorry

Profit for whom, crowd members? or the end user? If we are only talking the business side of crowfunding then wouldn't crowd members be involved in hopes of gaining a profit too?

Peter
 

NVP

Legendary member
37,768 2,101
hey Pete

profit for everyone...investors and companies ..some of these (to many) sites appear to be designed to fund "worthy" projects and returns are not provided to the investors

I am talking the dragons den sites.....where we are venture capitalists

i'll drop a few in as we go.....still learning

N
 

NVP

Legendary member
37,768 2,101
for example ive just been looking at Crowdcube.com

http://www.crowdcube.com/pg/how-it-works-4

shares offered in return for investment of fledgling businesses

so it is like dragons den.........

problem is........my mind has flashed up so many (many) issues here already on any venture re seeing the investment ever returned ..........it hurts !!!

hmmmmm...perhaps i am more of a fan of those loan based schemes which are in effect Corporate Bonds .......

a small share in a private non listed company are worth sh**te .....unless it floats somewhere eventually or indeed is the next google

hmmmmmmmm
N
 

isatrader

Senior member
2,963 134
for example ive just been looking at Crowdcube.com

How Crowdfunding works > raise investment, business finance : Crowdcube - Crowdcube | Crowdfunding business finance from angel investors and 'Armchair Dragons'

shares offered in return for investment of fledgling businesses

so it is like dragons den.........

problem is........my mind has flashed up so many (many) issues here already on any venture re seeing the investment ever returned ..........it hurts !!!

hmmmmm...perhaps i am more of a fan of those loan based schemes which are in effect Corporate Bonds .......

a small share in a private non listed company are worth sh**te .....unless it floats somewhere eventually or indeed is the next google

hmmmmmmmm
N

I've done a fair bit of research on it over the last six months as I think it's an interesting new area that was previously only available to sophisticated investors. Like you say, return on investment is the biggest problem area as you are investing in a private company with no secondary market to sell on the shares should you want to exit. So the only way to release your capital is when the company decides to do another funding round or if you can get someone to buy them off you, or if the company manages to float on the stock exchange. You should however receive regular annual dividends if you invest in the right type of company, but from what I've read you should be willing to lock up your cash for a long time and you might lose it all if the company doesn't do well. So my thinking on it is that you'd need to diversify in a big way with lots of small investments in multiple companies as only a few will make it big, whereas the majority will be middle of the road investments or bomb completely.

Another type of crowdfunding which launched a few months ago in the UK which you might find interesting is property crowdfunding. A property development company called thehousecrowd.com in Manchester is using crowdfunding money to renovate properties and is up to 8 projects so far since March. I signed up to get all the information, but was concerned personally by the lack of exit strategy and the amount of legal documents necessary. Imo it's a good idea, but needs simplifying if it's going to become more popular.
 

NVP

Legendary member
37,768 2,101
thanks Isatrader

thats interesting.........I may turn to these areas with a small % of my portfolio but will focus on the sites/deals with a fixed % return pa and a fixed term like 3-5 years (although that still ties me in of course)

the problem in this goddam country is trying to get liquidatable returns that beat inflation sufficiently after (higher) tax bracket and the other crappy clingon non-value added overheads we all pay for

Jees......
N
 

isatrader

Senior member
2,963 134
thanks Isatrader

thats interesting.........I may turn to these areas with a small % of my portfolio but will focus on the sites/deals with a fixed % return pa and a fixed term like 3-5 years (although that still ties me in of course)

the problem in this goddam country is trying to get liquidatable returns that beat inflation sufficiently after (higher) tax bracket and the other crappy clingon non-value added overheads we all pay for

Jees......
N

Another crowdfunding one that you might or might not be aware of is Zopa. It's peer to peer lending, and you can lend up to £25k out in amounts of £10 minimum. You can get roughly between 6% to 10% return p.a. after defaults depending on your risk tolerance. Here's the link: Lend money online with Zopa the peer to peer lending marketplace
 
 
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