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The best source for news and information about crowdfunding for good.

Crowdfunding for Social Good

Devin D. Thorpe

Devin Thorpe

Monthly Archives: March 2015

Real Estate Crowdfunding Set to be $2.5 Billion Industry in 2015, Finds Crowdfunding Research Firm Massolution

Report Forecasts Real Estate Crowdfunding to Nearly Triple in 2015

LOS ANGELES — March 3, 2015 – Massolution, the leading research and advisory and firm specializing in crowdsourcing and crowdfunding solutions for private, public and social enterprises, has announced the release of its comprehensive 2015CF-RE Crowdfunding for Real Estate report, which will provide the first ever detailed look at the intersection of real estate and crowdfunding. The 158-page report features data on the exponential growth of real estate crowdfunding, the emergence of specialized real estate crowdfunding platforms and how this revolutionary new method of real estate finance and investment is disrupting this asset class.

The top findings of the report include:

  • Real estate crowdfunding grew 156 percent in 2014, just breaking the $1 billion mark, with campaigns ranging in size from less than $100,000 to over $25 million.
  • In 2014, North America stood as the largest region by funding volume at 56 percent market share, compared with Europe at 42 percent.
  • By 2015, Massolution forecasts that North America will retain its lead, reaching $1.4 billion in funding volume, but Europe will have just broken the $1 billion threshold.
  • Overall, real estate crowdfunding is expected to increase by 150 percent, equaling $2.57 billion in 2015, making it one of the fastest-growing industry segments of crowd capitalism.
  • This year, U.S. commercial and industrial property crowdfunding expects to see a 250 percent increase.
  • Growing investor interest in crowdfunding platforms is proving crowdfunding to be a legitimate source of funds as compared to traditional banking.

“It appears that alternative finance platforms are here to stay and are starting to nibble away, albeit limitedly, at the regulated banking segment,” said Steven Cinelli, senior fellow for Massolution research. “Crowdfunding affords users and providers of new capital options. And with enabled technology and scale, such platforms will even offer traditional banks new ways to enhance their existing client relationships through partnering. ”

One of the new and exciting findings in the report is the development of cross-border deals and expansion into other areas of the world due to the emergence of global real estate platforms like Wealth Migrate. This is leading to a dramatic increase in real estate crowdfunding in regions with markets large enough to potentially surpass the U.S. in terms of both investors and available opportunities.

“The intersection of real estate and crowdfunding is enabling a huge leap within the industry away from the old property syndication model to new intermediate marketplaces, further proliferating this model around the world,” said Carl Esposti, founder and CEO of Massolution.

Because crowdfunding platforms have turned their focus internationally, investors from around the world have the chance to capitalize on opportunities on nearly every continent.

“It is important to expand a real estate investment portfolio beyond your own backyard in order to access the global investment community for greater capacity, reduced risk and sustainable growth,” said Scott Picken, founder and CEO of Wealth Migrate, one of the top 10 leading real estate crowdfunding platforms in the world.

While the report includes substantial information on crowdfunding in general as well as segment-specific content on crowdfunding activity, it also examines trends, effects on the traditional banking industry, and the outlook for real estate crowdfunding. As has been the case with all prior Massolution reports, 2015CF-RE Crowdfunding for Real Estate will be a much-cited resource for potential investors and businesses to begin researching how crowdfunding platforms can help them gain wealth through real estate investment, while also analyzing whether this model will remain profitable long term.

“The report does an excellent job of not only identifying trends in the real estate crowdfunding sector, but provides context and insight to explain the field’s significant opportunities for issuers and investors,” added Dr. Richard Swart, Massolution research advisor. “Real estate crowdfunding platforms will transform many of the syndication practices in real estate investing, yet are poorly understood. This valuable report is the first to provide insight to the professional community.”

You can purchase a licensed copy of the report here. Broad distribution of the report was made possible by Founding Research Sponsor Wealth Migrate.

About Massolution

Massolution® is a unique research and advisory firm specializing in the crowdsourcing and crowdfunding industries that is helping write the guidelines for a new way to do and fund business. Massolution works with governments, institutions and enterprises in the design and implementation of crowdsourcing and crowdfunding business models that drive improved business performance, product and service innovation, enhanced levels of customer engagement and in the formation of new sources of capital. Massolution also publishes the industry website www.crowdsourcing.org. For more information, visit www.massolution.com.

RallyMe Boasts 17,000 Sports Boosters

Bill Kerig, CEO and Founder of RallyMe, says, “The cost of participation in sports is rising dramatically, while support for athletics (from schools, communities, and other centralized organizations) is decreasing. No longer can athletes and teams rely on a large organization to foot their bill. Now is the time for athletes to build their own armies of support through people-to-people funding.”

Explaining his mission to help athletes, he says, “My vision for RallyMe is that it becomes the standard for all online athletic fundraising. Whether you’re an Olympian or a 9-year-old triathlete or a girl’s lacrosse team, we’re dedicated to helping you pursue your athletic goals.”

“Our mission is to make sure that no athlete, team, or organization has to forgo their sporting dreams for lack of a relatively small amount of funding,” he adds.

RallyMe, a site for boosters of all types, is used by national governing bodies to fund their organizations, teams, clubs and athletes, Bill says.

“From our launch in November 2012, we focused first on Winter Olympic athletes. We had 124 Olympic hopefuls use RallyMe and 28 Olympians get to Sochi by using RallyMe. Of those 28 athletes, 5 RallyMe athletes earned medals, putting us just ahead of Great Britain in the medal count,” he notes.

RallyMe boasts more than 17,000 boosters, Bill says, noting that the site has collected over $1.5 million for “athletes, teams, and organizations.”

On Thursday, March 5, 2015 at noon Eastern, Bill will join me for a live discussion about the site. Tune in here then to watch the interview live.

You can download an audio podcast here or subscribe via iTunes.

More about RallyMe:

RallyMe is the industry leader in crowdfunding for athletes, teams, and athletic organizations. An exclusive partner of 15 National Governing Bodies and more than 30 national teams, RallyMe is the Gold Medal Standard in athletic crowdfunding.

Bill Kerig

Bill Kerig

Bill’s bio:

RallyMe founder and CEO Bill Kerig is an Internet entrepreneur, and award-winning author, journalist, and filmmaker. He’s led three private and public Internet companies, produced and directed five films, written three books, launched two magazines, written hundreds of magazine stories and produced dozens of TV shows. He was a professional skier and captain of his collegiate hockey team. He currently coaches two youth hockey travel teams. He lives in Salt Lake City with his wife and two children.

Remember to “join the cavalry” by subscribing to our content here.

Devin D. Thorpe

Child Rescue Association Needs Your Help To Rescue More Children

Jess Larsen of Child Rescue Association is working to rescue children from an unimaginable life as victims of sex trafficking. He is raising money on MobileCause. Recently, I caught up with Jess to learn more about the effort; here’s what he told me:

What is the social benefit you hope to achieve with or through your crowdfunding campaign?

Child Rescue Association of North America is working to eradicate child sexual exploitation by rescuing 2 million exploited and trafficked children–one at a time if necessary.

Our current campaign will fund a rescue mission happening in Latin America this week. Child Rescue and our partner, Breaking Chains, expect to rescue 15 or more kids being held as sex slaves, some of them as young as 11 years old.

child_rescue_association

How much money are you hoping to raise and why? How much have you raised so far?

Our hope is to raise $22,900 for this rescue mission, which will be used to cover all of the operational expenses of the mission, including airfare for our rescue team, setup for the sting operation, covert surveillance equipment, “purchasing” of the children, and existing costs for in-country victims aftercare.

Over $21,000 has already been raised for this mission, so we need to raise an additional $1,000+ in the next day or two. Any excess funds raised through this campaign will go to future rescue operations. YOU can help save kids from sex slavery!

Whom are you trying to help with your project and why?

This is a chance for us to bring freedom, both spiritual and physical, to these young children. We’ve seen pictures of the girls who are waiting to be rescued. Just seeing their faces gives us that much more determination to protect them from harm.

Many kids being trafficked as sex slaves come from backgrounds of poverty, and may have been lured into slavery through promises of work, physical force and threats of violence or death, emotional manipulation, being sold by their own family, or a combination of those factors.

We’re working with the Federal Government of the country where the mission is taking place, and these operations will be official police actions. Right now, local law enforcement, Child Rescue, and Breaking Chains are preparing for a full tactical takedown by the government special forces, and you can help.

Check out the campaign:
Visit the website.
Follow on Facebook.
Follow on Twitter at @childrescue_na

WePay Crowdfunding Tips & Tricks:

Crowdfunding continues to grow in popularity creating endless opportunities for new and inventive commerce and fundraising opportunities. New platforms are emerging to serve specific verticals or sets of verticals. These niche platforms are dominating the space from technology/hardware to food and beverage. Not only has crowdfunding become a great way to generate much needed funds but the marketing an organization can receive is also quickly gaining value.

As competition surges, what does it take for a business, non profit or even a small community fundraiser to stand out in the crowded landscape of crowdfunding?

WePay’s payments API is built specifically for platform businesses like marketplaces, crowdfunding sites and small business software. These platforms are empowering millions of users worldwide to unlock all kinds of creative commerce. Through its proprietary VedaTM risk engine, WePay gives platforms a flexible payments API that provides a great user experience while still being able to take on all their fraud risk and compliance burdens. With the backend of payments secured, there is plenty to be done on the front end to create a successful crowdfunding campaign in the public eye:

  1. Get to the Point: Create a clear, direct and impactful explanation of the need.  Make sure to spell out what you are fundraising for, why the cause is important to you and what difference each donation will make but keep it as short and sweet as possible.
  2. A Picture is Worth a 1000 Words: The more visuals you can bring to the table, the better.  If photos and videos are available don’t hesitate to showcase them to best highlight your cause or mission.  Video in particular can be an immensely effective tool to attract desired attention and action to a campaign.
  3. Make the first move:  Get the ball rolling by making the first donation to your fundraiser, your  friends, family and associates will follow your lead.  Be mindful of how much you give as well.  If you want people to donate $100, don’t donate less as you are setting the bar for others to follow.
  4. Update, Update & Update: It’s a given that you need to connect to as many social media channels as possible to spread the word about your fundraiser but it’s also important to keep donors up to date on the status of your fundraising efforts.  Changes in the status of a fundraiser such as raising your fundraising goal is information essential to share through Facebook, Twitter, email, etc.
  5. Don’t Forget To Say Thanks!: Crowdfunding sites will automatically send a confirmation message to your donors which will also thank them for their generosity but a personalized thank you note will truly show your appreciation.  A list of donor emails can be made available to you for those who have opted to identify themselves.
  6. Double Check Your Math: When asking for money most of us want to stick to just asking for what is needed and nothing more but don’t forget to take into consideration additional expenses that  can come up.   For instance, crowdfunding for a new business can mean dealing with new kinds of taxes, marketing expenses, etc. that you may not initially think about.  Think it through first before establishing the goal.
  7. The early bird gets the worm: Prep work matters.  Before you launch your crowdfunding campaign,  reach out to potential donors to let them know what you’re up to and how you’d like them to be involved.    Campaigns that have the supporter base established in the beginning have a much greater chance of succeeding than those who set up the fundraiser and then begin reaching out to the community for donations.
  8. Sweeten the Pot:  Like anything in life, incentives get people’s attention.    Be resourceful and find ways to inspire people to donate, even more than once!  Find a desirable prize to offer up as a giveaway.  A giveaway such as donors who contribute more than $100 can be entered to win an Apple iPad can help you get closer to the fundraising goal.  Certain platforms offers these kinds of incentives for people to donate to fundraisers happening on their platform.
  9. Do Your Research:  There are a lot of options out there to choose from to host your fundraiser but which one is the right one for you?  Commission rates can differ along with varying rules on what you get or don’t get based on meeting your goals.    Some crowdfunding site specialize in certain kinds of fundraisers over others so dig around a bit to make sure you’re selecting the best platform for you.
  10. Take if offline:  Social networking is key to creating momentum, but don’t forget you can raise awareness about your campaign through face to face encounters at work, social and community gatherings.   Also, don’t forget about the media — your local newspaper, TV and radio outlets may be interested in sharing your cause with the general public too.

Bill Clerico is CEO and co-founder of WePay, where he drives the company’s vision, strategy and growth.  WePay’s payments API is built specifically for platform businesses like marketplaces, crowdfunding sites and small business software.

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