The new crowdfunding law passed as part of the JOBS Act, which allows companies to sell pieces of their business for cash, won't be finalized until early next year. But many entrepreneurs are already champing at the bit to deliver on the services they think this new marketplace will want.
Here's a look at several industries and jobs being developed as part of the trickle-down effect of crowdfunding, according to David Marlett, Executive Director of the National Crowdfunding Association, an industry trade group that has been involved in discussions shaping this new genre of startup financing.
- The Portals. Thus far, crowdfunding
has been primarily a way for artists to raise small donations
from lots of people (the crowd) in exchange for rewards, such as
CDs or other project-related gifts. Now, entrepreneurs are moving
in to create similar online platforms for companies wanting
to offer pieces of their business (think Kickstarter, but
for equity). Marlett estimates there will be approximately
100 portals ready once the new crowdfunding rules take
effect, although many are likely not to survive the first
year of competition.
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- A New Breed of Analysts. As with any new
product, there will be a demand for a ranking of the portals,
says Marlett. Investors and entrepreneurs will want to know
which portals have had the highest success rates. In the same
way that there are analysts of financial data, there will be
analysts of the various crowdfunding portals, says
- Specialized Software. With all the new
crowdfunding portals, Marlett expects a slew of new software
entrepreneurs to create a variety of applications, that handle
everything from allowing you to crowdfund from your mobile
phone to allowing investors to research a business.
- Risk Managers. There is always a way for
insurance companies to make a buck in just about any industry,
and crowdfunding is no exception. In what is termed as "Keyman"
insurance, investors can purchase protection should the
critical leader of a project (the “key” man) die or is in some
way incapacitated so that he or she can’t finish what they
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- Calling All Experts. From lawyers to
consultants to accountants to Certified Financial Planners to
public relations managers, the advent of Crowdfunding 2.0
demands a whole new genre of business specialists, each
targeting a certain geographic region. Professionals will
advertise their specialty heavily, too, with slogans like “We
will get you into crowdfunding. We will help you along the
way,” Marlett says.
- Escrow Agents. Somebody needs to hold the
money. If an entrepreneur raises the full amount (or more) that
he or she asked for, then the escrow agent releases the money
into the entrepreneur’s hands. If not, it all goes back to the
various investors. Escrow agents will be the third party
handler for all the money.
- Resellers of Purchased Shares. There could be
a separate, alternative market for shares of companies bought
through crowdfunding. “Now we are really speculating,”
acknowledges Marlett, because anyone who buys stock can’t sell
it on an open marketplace for a year, so there is still some
time before an alternative marketplace could even be
Related: Want to Raise Money With Crowdfunding? Consider These Tips
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