Entrepreneurship is one of the few non-partisan issues these days. As a potential engine of job creation, both sides tend to idealize startups and SMBs as the cure-all for a laconic economy and unemployment. Of course, to grow and create those jobs, startups need capital. And traditionally, the businesses that can’t or won’t raise venture capital turn to banks, commercial lenders, and other sources to fund their operations. However, with the credit crunch, SMBs were forced to turn to other alternatives. Namely, crowdfunding sites.
The passage of the JOBS Act earlier this year cemented that not just in practice, but in policy. As a result, it’s been a huge year for crowdfunding platforms — especially Kickstarter, which has raised $50 million for games alone in 2012. But with the increased attention, we’ve started to spy potential holes in the crowdfunding model.
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