"Crowdfunding," which is described as "the practice of . . . soliciting [financial] contributions from a large number of people especially from the online community," has recently taken the financial world by storm through the advent of websites like "Kickstarter," "Fundable," "IndieGogo," "Razoo," and "Appbackr." Such websites provide a marketplace whereby companies, small businesses, and entrepreneurs looking for startup capital can solicit funding from individual investors. The concept is relatively straightforward: project creators initiate a profile that includes informative bits like short videos, a brief synopsis of the project, and images to further showcase the project. Each project has a target amount of funding to be raised, and is active for a fixed time period, which is commonly displayed as a countdown with an ongoing tally of funds raised. Ultimately, the goal of crowdfunding is to create a highly specific and unique group of like-minded individuals from the general public, and in turn utilize that community to generate necessary capital to implement a project or even create a business.
Andrew S. Hovestol,
To Fund or Not to Fund: Deficiencies in the Wisconsin Crowdfunding Act that Hamper the Viaiblity of Intrastate Crowdfunding,
100 Marq. L. Rev. 1063
Available at: http://scholarship.law.marquette.edu/mulr/vol100/iss3/10