Recently attended an event organized by OPEN SV on The Rise and Evolution of Collaborative Funding. It was an exceedingly informative session with panelists from Redpoint Ventures, Fenwick and West, Sheppard Mullin and Double Fine.

The panelists provided a holistic view of Crowdfunding with questions spanning from its concept to legal implications, success stories of companies launched through Kickstarter (a leading crowdfunding platform) and the overall future of crowdfunding. The moderator from Fenwick and West facilitated the event well and helped steer specific points in the discussion.

Aurangzeb Khan an entrepreneur with extensive experience in the semi-conductor industry spoke about his experiences of raising capital through crowdfunding. He spoke about his experience as an entrepreneur raising funds conventionally as opposed to using crowd sourcing model for his latest venture. Riaz Karamali another panelist and a corporate lawyer covered the legal implications and shed light on threats which the companies could encounter raising finances through crowdsourcing. Riaz indicated that while a broad framework has been put in place, a lot has to be established with regards to rules adhering to dos and don’ts in the crowdfunding world. The profound discussion followed questions and answer session from the audience with a lot of keen to be entrepreneurs looking to venture the crowdfunding world. Participants were keen to know what link the entrepreneurs must maintain with the investors who fund a particular project. Justin Bailey an entertainment professional and another panelist at the session added that investors not just act as sponsors of the company and its products but they also act as marketers and customers of the product after its launch. While to many out there the concept may seem overly simplified a lot has to be done in terms of forming forward and backward linkages with sponsors. In an example Justin mentioned that thousands of dollars are being spent on postage and sending souvenirs to millions of sponsors around the globe in case of a newly established company. It was truly enlightening to see how the web and other social networking sites like Twitter and Facebook are also used to leverage marketing and fund raising efforts of these new ideas. Firms closely monitor the increase in the website hits of these newly launched idea-companies being launched through crowdfunding platforms which truly indicates that if the idea is good, obtaining funding can be a reality.

On the whole it was an evening well spent with renowned professionals courtesy the professional and dedicated team of OPEN SV, which helped me learn a lot about the recently buzzing funding source; crowdfunding.

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