Before we proceed, let us make it absolutely clear that we have nothing against crowdfunding. We believe the basic principle behind crowdfunding is sound, and, in a perfect world, it would boost innovation and provide talented, creative people with an opportunity to turn their dreams into reality.
Unfortunately, we live in the real world, and therefore it’s time for a reality check:
- The state of things as they actually exist.
- The place where bad crowdfunded ideas come to die.
While most entrepreneurs may feel this mess does not concern them because they don’t dabble in crowdfunding, it could have a negative impact on countless people who are not directly exposed to it:
- We are allowing snake oil peddlers to wreck the reputation of crowdfunding and the startup scene.
- Reputational risks extend to parties with no direct involvement in crowdfunding.
- By failing to clean up the crowdfunding scene, we are indirectly depriving legitimate ideas of access to funding and support.
- When crowdfunded projects crash and burn, the crowd can quickly turn into a mob.