I’ve never had a bad word to say about crowdfunding – until now. Now I am rendered speechless by perhaps the biggest backhanded compliment ever.
Crowdfunding is about the crowd. The clue is in the name. It’s funding for the crowd by the crowd. It has the potential to democratise finance, to reinvent and reinvigorate capitalism.
Last week, the most unlikely person on the planet jumped on the bandwagon, chequebook in hand. It’s as if Attila the Hun invited us to tea.
Donald Trump, most famous in these parts for his attempts to bulldoze a whole community in Scotland, is reported to have described his involvement with the just launched FundAnything site as his response to people feeling “bullied by the economy”.
Long time associate Bill Zanker clearly has a way with words too. He says he “boot-strapped” FundAnything with a mere million dollars, bringing a whole new meaning to the term. But then, when asked what the Donald Trump brand stands for in this case, Zanker said, “It stands for money and it stands for luxury, for first class, for being proper.” Not around here it doesn’t.
Challenged that it looks just like a ripoff of Kickstarter and Indiegogo, Zanker was reportedly far from apologetic. Imitation being the sincerest form of flattery, presumably.
But it’s not a very good imitation. Far from it. It’s entirely missed the point. Which is not to enrich fat cats by charging more than the industry’s already established norms – and ramping it up when a fund struggles (up to nine per cent from five per cent). Nor is it for said fat cats (apologies to cats everywhere) to sit on the sidelines with suitcases brimming with cash (so much more photogenic than a cheque) and cherry-pick causes to fund for their own purposes or self publicity – “trumping the crowd”, as at the launch. Yuk!
Its promise is to bring hope to the 99 per cent plus who are not multi-millionaires. To create jobs and opportunities for millions. To support entrepreneurs and start-up businesses. Opening up entrepreneurealism and investment to everyone who’s willing and able. It’s for the crowd.
That promise is not diminished by what Zanker and Trump launched yesterday. By so completely missing the point they’ve thrown it into yet sharper relief.
Barry E. James is founder and director at thesocialfoundation.org.uk.
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