• Oranburg on Crowdfunding

    by  • October 6, 2015 • Scholarship • 0 Comments

    Photo by Simon Cunningham, used with CC license

    Photo by Simon Cunningham, used with CC license

    In Professor Seth Oranburg‘s forthcoming book Social Media Investing, he intends to “weave together ideas from various literature and present new theories in corporate finance, securities regulation, business associations, and entrepreneurship.” In anticipation of the book, Professor Seth Oranburg examined the impact of crowdfunding as an emerging financial model in a guest post on the GoodCrowd blog. Read an excerpt below:

    Crowdfunding began as a way for independent musical artists to raise a few thousand dollars to rent a recording studio and release a record. It evolved distinct “rewards” and “donative” models. Rewards crowdfunding promotes consumer projects ranging from the niche (a casebook about zombie law) to the ubiquitous (the Pebble smartwatch). Donative crowdfunding promotes new charitable projects like micro-lending and cancer research. Public crowdfunding is a new model, where mature nonprofits are using portals to fund public goods by offering rewards and challenges.

    Public crowdfunding is different from traditional charity fundraising in at least three important ways. First, public crowdfunding is an open call to action on the Internet to all people, not a targeted charity campaign to visitors or former donors. Second, public crowdfunding uses gamification principles like challenges and rewards to attract backers in real time. Third, public crowdfunding highlights and advertises a specific public-good product, instead of promoting a non-profit generally. These three factors, harnessing the power of the Internet, make public crowdfunding a powerful new tool to democratize charities.

    Professor Oranburg is also interested in the confluence of crowdfunding and law practice. You can read the rest of his piece at GoodCrowd.

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    The purpose of the C-K Faculty Blog is to provide a forum that brings together all the rich intellectual contributions of the Chicago-Kent faculty and to encourage respectful and scholarly dialogue within the extended Chicago-Kent community, including faculty, students, alumni and colleagues at other law schools and universities. For questions or more information, contact the C-K Faculty Blog Editor by e-mail at facultyscholarship@kentlaw.iit.edu.

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