A Skeptic’s Take on Crowdfunding

Paul Jones, co-chair of Venture Best, the venture capital practice group at Michael Best, has been selected as a regular contributor of OnRamp Labs, the newest blog addition to the Milwaukee Journal Sentinel covering start-ups and other Wisconsin technology news.

Paul’s contributed piece “A Skeptic’s Take on Crowdfunding” can be found under their Business Tab in the Business Blog section. Click here to view his latest blog.

Here is a short excerpt:  “Crowdfunding – for my purposes today the sale of equity by early stage high risk/impact businesses via general solicitations of investors, as for example over the internet – is probably the biggest thing to come along on the startup financing landscape since the 1933 Securities Act. While the final rules are still playing out, it is already clear that crowdfunding is rapidly emerging as a viable alternative for raising startup capital. Lots of folks think that crowdfunding will bring enormous new pools of capital to the startup financing business, benefiting capital starved entrepreneurs and investors previously locked out of the startup financing game alike. Praise be your preferred Deity.

Count me, though, as skeptical. Not that crowdfunding won’t produce some good deals that might otherwise not find their footing, but rather that crowdfunding will have a significant positive and durable impact on the risk capital environment for quality high impact startup businesses. My sense is that when all is said and done, in terms of the preferred financing strategies for the higher quality early stage startups, crowdfunding will produce a lot more smoke than fire.”

Click here to read more of Paul Jones’ OnRamp Labs blog post located under the Business tab of the Milwaukee Journal Sentinel’s website, www.jsonline.com.

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