The digital age has a knack for creating innovative online platforms that bring people together as one — Facebook and Twitter being the biggest examples. And while they lead the pack, nothing quite compares to the communal achievements of crowdfunding.
For those who don’t know, crowdfunding is an online platform where people can invest in projects for entrepreneurs — budding or experienced — who believe in their creative vision. These projects include everything from films and music to video games and journalism.
Or, in the case of the gossip website Gawker, the video that allegedly shows Toronto Mayor Rob Ford smoking crack.
Crowdfunding helps artists or entrepreneurs get a boost they normally couldn’t get without backers with deep pockets. In the case of the so-called crack video, $200,000 was raised through the crowdfunding website Indiegogo. (In the end, however, the fundraising campaign was for naught since the people behind the video failed to produce it after getting their asking price.)
While Indiegogo is one of the biggest players in the crowdfunding community, the big daddy of them all, Kickstarter, has raised hundreds of millions of dollars for tens of thousands of projects. And as of this week, Kickstarter is now available in Canada.
The move is sure to excite entrepreneurs looking for a funding boost — more than 3,000 Canadian projects are already seeking cash on Kickstarter.
But while there is great satisfaction in donating a buck or two to a project Canadians believe in, there is little return on that investment. In fact, none that is monetary. If a Kickstarter project succeeds, investors will get rewarded with a thank-you card, T-shirts or other product promos.
Doug Bruce, vice-president of the Canadian Federation of Independent Businesses, hopes that might change. Bruce says Kickstarter’s inclusion in Canada is a significant step for small businesses, but told The Canadian Press that entrepreneurs would benefit if they could woo investors with the promise of equity in their company.
We stand behind anything that promotes risk-taking among entrepreneurs, and while Kickstarter is a for-profit company, we agree with Bruce that encouraging investment with a monetary reward will help kickstart even more success.
We Say editorials represent the viewpoint of The Daily News and are written by publisher Tim Shoults, city editor Tracy Gilchrist, or associate news editors Dan Spark and Mark Rogers.