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View Full Version : Why Crowdunding Will Be a Massive Job Creator and Boost for the Economy



admin
07-21-2013, 09:09 PM
When I sit back and think about the potential of the crowdfunding market in general once the SEC permits equity crowdfunding here in the US, I sometimes feel many people are underestimating just how much it could add to the economy. Besides the obvious economic impact of having hundreds of new startups able to raise funds via equity funding, the micro economy of the actual crowdfunding arena will be huge in itself. Have a look:

The Startups
Anyone with an idea will soon be able to put that idea up for the ultimate test, the open market. If it's really a great idea it will now be easy to raise funds via investments. No need to go the route of pitching your protect to venture capitalists. Literally hundreds or even thousands of companies will launch each year which likely would have only remained ideas in someone's heads. Hundreds or thousands of new startups will translate to tens of thousands of jobs sprouting up each year from the hirings these startups will be doing.

The Platforms:
There are already over 600 crowdfunding platforms online, however this number is expected to grow in the coming 12-18 months, once we have the equity crowdfunding model in full swing. Each platform will hire anywhere from 2-50 employees, meaning even more jobs!

The Second Markets:
With the possibility of hundreds or even thousands of equity based projects selling shares to individuals and companies, there will likely emerge a "second market," or share exchange in which an entirely new business sector will emerge. Like the trading of stocks on the NASDAQ or NYSE create thousands of jobs and hundreds of business's which expand on those markets, a crowdfunding second market will likely flourish in the long run.

Crowdfunding Services:
We are already seeing dozens of unique services launch around the crowdunding markets. From Crowdfunding PR sites, to forums like this one, to crowdfunding consultants, to directories, advertising services and more, hundreds of jobs within the service sector are sure to emerge in the coming months and years ahead. New categories of jobs will come about as innovation within the markets expand.

Lawyers, Lawyers, and More Lawyers
Anyone offering equity positions within their companies will certainly need legal advice. Lawyers within the field of crowdfunding will be a hot commodity for sure

The JOBS Act, in my opinion will be a huge success, primarily because for crowdfunding. By the end of Obama's Presidency I feel he may finally get some much due recognition for how he has handled the economy following the great recession. opinions?

Booklover
07-22-2013, 11:48 AM
It would be a huge impact not on US economy alone but world wide if crowd funding could catch on all over the globe. So many projects have been founded through this great avenue and I'm positive the Obama administration would be lauded for its proactive approach to the economy. And what's more, the number of people that would be employed, as you've rightly stated, would be staggering!

SocialCam
07-22-2013, 05:00 PM
I agree. This is Big for Obama, for his legacy as a President following a near economic collapse. The economy has already begun to rebound, but the next 3 years will be crucial for his economic legacy as a President. Seems like Equity Crowdfunding could be just what he needs. It won't just be crowdfunding though. We are living in amazing times of technological progress. 3D Printing may bring thousands of jobs back to US soil from Asia, and cloud computing is cutting costs of business's across the board. With a robotics revolution soon to take place we may be on the brink of rapid growth in the economy.

jordanbaines
07-22-2013, 08:26 PM
I think you've taken a great look at this from both the job-creation and political side, but the context I'd add to this is scope. One of the reasons for speculation as to how crowdfunding for equity will radically increase capital for emerging businesses comes from a bit of speculation attributed to Fred Wilson of Union Square Ventures (Forbes Midas list #16). According to him, an investment of 1% of income from the mass of "common" investors would create somewhere on the order of $300 billion in capital each year. (source: Forbes (http://www.forbes.com/sites/jjcolao/2012/05/08/fred-wilson-and-the-death-of-venture-capital/)) That's an amazing amount of capital to build butcher shops, laundromats, biotech firms, t-shirt design houses, and just about anything people do to create value. With that much potential capital available, provided there's an efficient way of distributing it, we could be seeing the emergence of a generation that starts and ends their career in entrepreneurship, striving and learning to win for themselves.

Of course, that's just what I'm hoping to see.

admin
07-23-2013, 09:11 PM
I Jordan, great point. I truly believe that in the next 5 to 6 years we will see a transformation in the way financing and borrowing money works in the world. Anyone with a solid idea will likely be able to find funding for it. This will equate to lower unemployment, and a growing world economy. I'm really excited for what the future holds. There is so much pessimism in the news about the economy and how poorly off people are, but we are much better off as a planet then a decade ago, and that is after the great recession.

Call Junky
08-08-2013, 06:00 PM
yes its required -the banks have killed the venture capital growth market last 5 years

SocialCam
10-09-2013, 10:49 AM
It's all about evening the playing field for everyone. If a person making $2 million a year can invest into something, why shouldn't a person making $30k a year be able to? I totally agree that equity crowdfunding, and even rewards based funding is probably the biggest shot in the arm for the economy then we have seen in decades. It will be slow to show it's affects, but I am guessing that by 2016-2017 we will begin to realize the fruits of this change. Obama will be viewed in 50 years like FDR is viewed today.

Matt Busch
11-03-2013, 05:29 AM
And if anything, sending out all the rewards isn't hurting the postal service! :)

startingtrends
11-04-2013, 09:17 PM
And if anything, sending out all the rewards isn't hurting the postal service! :)

That's a good point, and more shipping = more jobs.

Lelocks Trent
11-24-2013, 12:26 AM
I agree, this market could become huge. It has so many different levels of job creation. The biggest will be from the start ups which launch because of the funding they are able to obtain, but also the platforms and services are employing thousands of people already. Wait until a second market for shares comes out. That will launch a whole other bunch of jobs.

smartinvestor
11-24-2013, 06:32 AM
Agreed, there should be so many winners in this whole arena, it's a bit surprising no one thought of it earlier.

The banks don't seem to want to back small businesses, so let someone who does want to be allowed to invest.

CrowdFundFusion
11-28-2013, 09:37 PM
The economy gets hot when people spend money since 2/3 of the economy is based on consumer spending. Crowdfunding has and will continue to get people to spend more so there is more money circulating. Which creates more jobs, so people have money, so they can spend more, to create more jobs...you get the picture ;).