Last month, as part of Via Meadia‘s focus on what we have loosely defined as the “jobs of the future”, we highlighted the crowdfunding company KickStarter. KickStarter, like other crowdfunders, is designed to pool money from thousands of ordinary people to fund entrepreneurs with ideas. It’s venture capitalism by the little guy, for the little guy.Crowdfunding continues to grow. This still new market has seen more than $1.5 billion change hands and funded tens of thousands of projects. Unlike traditional venture capital, in which funding is provided in return for a monetary reward (usually equity), crowdfunding offers investors non-economic benefits. Arie Abecassis sits on the boards of multiple start-ups and notes that crowdfunding’s raison d’être has changed dramatically in a short period of time: “Many of these online platforms were originally thought of as places where you could discover quaint products, like an iPod accessory, or projects, such as funding a hiking trip, rather than the capital-formation facilities that they have become.”Abecassis identifies four ways he expects the crowdfunding model to continue to evolve:
1. Vertical platforms will emerge to focus on select market segments. . . .2. Crowdfunding platforms will evolve into “full-service” communities to better meet the needs of their members. . . .3. Creativity and innovation through online crowdfunding will be supported not just by individuals but by organizations as well. . . .4. Benefits-based crowdfunding will complement equity-based platforms. . . .
As old technologies and old jobs crumble, anxiety builds about what comes next. Via Meadia won’t try to predict which startups will turn into the Apple and Google of the next generation. But we do know that America’s genius is its dynamism: the willingness of its young people to take risks and start companies, and the willingness of investors to take a chance on these fledgling startups.The evolution and rapid development of capital markets—and the crowd-sourcing platforms that decentralize them—will increase the speed at which new ideas make it to the market, in turn accelerating the pace of social change and pushing America toward a new kind of economy and social order in the years ahead.Those who think that America’s time has passed haven’t reckoned with the creativity and the hunger that drives our new generation of entrepreneurs.