Product Development · Fundraising

Will more Fortune 500 companies, like General Electric start using Crowdfunding?

Porfirio Partida Developer at Nearsoft

October 7th, 2015

Cool interview with Slava Rubin, cofounder/CEO of Indiegog on this FD blog. One thing he mentioned which I'm not sure I agree with is that, "more and more you'll see companies using crowdfunding as their normal approach of doing market validation, getting extra promotion, R&D and engaging with the customer before they move into the commerce experience, because they'll learn a lot. They'll be able to raise money and test the market at the same time. More Fortune 500 and larger companies will move into this because it will be good for business, like you see right now with GE, which has raised a bunch of money with a campaign on Indiegogo for the Nugget Ice." I see it more as a one off thing, but I don't see Fortune 500 companies developing all their products this way. Do others agree/disagaree?

Anton Yakovlev Founder of four successful businesses on two continents who can help you do the same

October 7th, 2015

I do not think F500 companies will massively go for crowdfunding. At least I personally would not back any of such products, whether they look good or bad for me. An F500 company is supposed to have it's own funding, and there's no need to crowdfund their projects. At the same time, I do not find it appropriate to use crowdfunding plaforms as a marketing tool. This trend looks frightening, and it may kill the very idea of crowdfunding in the perspective. Either you are showing your ads to me (and pay for it), or you are raising money from me (and I don't want to be brainwashed with your ad-aproach in this case). 

B. Graham Founder and CEO at CrowdComfort, Inc.

October 7th, 2015

The stock market is a crowdfunding platform. It happened just about 200 years ago when people needed to come together in a real crowd to create a market. Now markets can form in many ways leveraging modern technical advances along with innovative new market models. These models will fragment and then consolidate offering more choice, accessibility and competition over and over again. You can be sure that many F500 companies will use these new methods. Just as today many very large companies do not go to stock markets for funding, some will use these new channels for capital while others will not.

Anton Yakovlev Founder of four successful businesses on two continents who can help you do the same

October 7th, 2015

I cannot agree more, Eric. Yes, stock market is basically a crowdsourcing plactform, and it never changed to become a low-cost advertising platfrom. And it should not, I believe. The idea af combining retail and funding is compelling of course, but I don't think it will survive in a long run. Not for F500 companies at least.

Neil Gordon Board Member, Corporate Finance Advisor and Strategy Consultant

October 8th, 2015

I suspect the largest crowd funding organization in the world is Walmart.

Thomas Sutrina Inventor at Retired Pursue Personal interrests and family

October 7th, 2015

GE using cloud fund raising is just another sign that GE has lost its way.  GE has obtained preferential treatment from Government which is not unusual, but it has lead the pack in intensity.  They will venture anywhere to get any advantage and do not consider anyone, any country, and has forgotten the reason for the Declaration of Independence.  "The supreme quality for leadership is unquestionably integrity. Without it, no real success is possible, no matter whether it is on a section gang, a football field, in an army, or in office." Dwight D. Eisenhower http://www.brainyquote.com/quotes

Lora Ezumba CEO FUNSIDY

October 7th, 2015

The possibilities with crowd-funding are limitless, who would have thought that GE or the White House would have a Facebook page back in 2007. I cannot even rule out the possibility a nation one day would crowd-fund projects. It is still too early to tell where this whole new industry will go. One thing is for sure, it is making it possible for greater awareness of cool and great ideas. Crowd funding will serve different purposes for different groups. I like the idea of more transparency with finance, the ability to reach anyone in remote parts of the world, an alternative to traditional forms of financing. It is one of the best things to happen in the 21st century. Our social participation is maturing into more productive aspect of our lives, its no more just sharing a picture on facebook, or twitting the latest, now we can start learning how to reach out with our finances. Whether you are investing or donating, you have better options, more transparency and it has never been easier to do this with so much information backing any project or campaign. What we are doing at www.funsidy.com will definitely put a good spin to an already exciting industry.

Peter Johnston Businesses are composed of pixels, bytes & atoms. All 3 change constantly. I make that change +ve.

October 8th, 2015

One of the important things for any startup product - whether it comes from a new company or a well established one - is publicity.

Marketers have recognised that one of the ways to growth hack an new product is to get the exposure which comes from a crowdfunding listing. Many people follow sites such as Kickstarter and Indiegogo and they are early adopters for new products.

So high profile crowdfunding sites are now awash with companies launching products. Some are merely trials to see where a market is going and where there might be traction, some are "if we get enough interest, we'll build it" ways for marketers to put pressure on their product teams.

And some are honest - with the company name on there, some are fake startup companies with a small print (part of X PLC) affiliation or even none listed (it doesn't have to be there on a crowdfunding site). 

Just like fake profiles on dating sites, we'll keep seeing more of it until people wise up and stop using the crowdfunding sites which allow it.