AARP The Magazine recently ran an article on crowdfunding dealing with the possibilities (and perils) of the evolving means of capital formation.
Kickstarter, RocketHub and EarlyShares all get mention in the piece alongside Sherwood Neiss of Crowdfund Capital Advisors. Rockethub’s Alon Hillel-Tuch and EarlyShares’s Heather Schwarz-Lopes are both quoted in the article. Neiss predicts that the campaign failure rate (a failure to secure required funding) in equity crowdfunding will be somewhere north of 80%. Lopes encourages entrepreneurs to try donation-based crowdfunding before turning to equity, and Hillel-Tuch calls the JOBS Act a “monumental shift in the way small businesses raise capital.”
AARP is one of the most powerful lobbies in the United States, and their primary constituency – those aged 50 and over – have been repeatedly cited as one of the groups most at-risk for crowdfunding fraud. The article nods to a letter sent to Congress by AARP Senior Vice President Joyce Rogers (embedded, bottom of article) warning that crowdfunding “could become the new turbo-charged pump-and-dump boiler room operations of the Internet age.”
Click below to read the article.
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