Crowds have already demonstrated their value as a source of capital for start-ups. Support via donations or pre-purchasing on sites like Kickstarter has set high expectations for equity-based crowd funding in the United States.
Discussions often focus on how crowds can and will compare to traditional institutions like venture funds or angels. One can argue simultaneously for the madness and wisdom of crowds, so it’s not yet clear how crowds will compare at picking the best startups. However, there are some areas in which crowds might outperform existing institutions. And for these contributions, crowds deserve serious consideration for startups and their stakeholders.
De-risking Product Market Fit
So much of start-up risk is trying to understand and prioritize needs for a particular group of people. What is their plan? How will they value a particular solution? And then how can I quickly get feedback to make the next iteration even better? And that’s just the product or service offering. Creating communications materials, from the logo to the website, benefits from similar feedback.