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The State of 'Corporate' Crowdfunding in the U.S.
By: Luke Willoughby
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In 2013 the phenomenon that is crowdfunding evolved past its principled and creative identity to become a new business segment with unlimited and unknown potential. A hockey stick growth model is now unfolding with new projects, investment volume, and the general awareness of opportunity.
 
But in the U.S., crowdfunding’s profit potential has been bottlenecked by a lawmaking process that is developing regulations, tax codes, and safeguards against fraud. Current models are restricted to reward-based compensation, while debt and equity investment is reserved for those who are affluent and "accredited" (AngelList is now the leading platform in this segment). The latest SEC proposal from October 2013 will expand these profiles to a wider investing class. Once approved, 2014 will see how the wider private sector jumps off the starting line towards more the profitable investment opportunities.
 
The current reward-based models have still produced several attempts that might be considered corporate by crowdfunding standards. Here are several examples of groups vying for success in the new marketplace or testing the waters for an exciting future.
 
1) A&E Television partnered with RocketHub in 2013 to create Project Startup. RocketHub will provide selected entrepreneurs with an opportunity for large-scale promotion within an A&E television program. A&E will then create opportunities for them to be implemented into their programing lineup, or labeled with popular branding like Duck Dynasty.
2) Canonical developed the Unbuntu Edge smartphone, or, rather, they are still developing. This project on Indiegogo broke the record for rewards-based backing in August of 2013 by raising $12.8 million. Unfortunately their goal was $32 million, so they won’t receive a dime in this attempt and the future of the Edge is unclear.
3) Smartwatches such as Pebble, along with other wearable technologies, are one of the most promising segments within crowdfunding, all guaranteed to give a new meaning to real-time marketing.
4) Heresy, a marketing consultancy in Austin, Texas, raised $36,000 early in 2013 to develop a book and app intending to ‘Reinvent the Advertising Industry.’ The authors curate the ideas of Madison Avenue’s most elite to provide a roadmap for adapting the dated landscape of today’s ad agencies into the modern, digital era.
5) AdTrap, an external hardware device that eliminates all advertising from your internet experience, on any device, raised $213,000 on Kickstarter in 2012.

   

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About the Author
Luke Willoughby works in the digital media landscape of New York across varying agencies and brands. He also has a background in video and content production, and is invested in the resurgence of the full-service advertising agency and the associated opportunities for the marketing industry. Originally from Denver, Colorado, he's a fan of most outdoor activities and otherwise enjoys reading and film.
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