The term ‘crowdfunding’ appeared in just one story published by the Financial Times in the whole of 2010.
That story was about how the newly-formed UK coalition government was encouraging the arts to look at plugging funding gaps by adopting a philanthropic innovation from across the Atlantic – crowdfunding. The idea was to tap into highly-engaged arts lovers using online fundraising platforms, and encouraging them through social media to make donations.
Pink pages have had more than 100 crowdfunding stories, but precious few have been about donations or the arts.
Crowdfunding’s original incarnation was about philanthropy, but the term has become a catch-all for web-based platforms where businesses can raise equity or debt from a ‘crowd’ of investors.
Behind the hyperbole and headlines, many stories conflate the different types of funding available on web-based platforms. Smaller in scale than peer-to-peer lending, and particularly relevant to the other two words that have proliferated on the business pages through the downturn –‘growth’ and ‘entrepreneurialism’ – equity crowdfunding seeks to address the funding gap for start-up and early-stage companies.
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