Expert questions and answers:
Q: I have noticed that there are hardly any crowd funding campaigns in the beauty\cosmetics niche and those that exists have very low goal targets, even the innovative products, why is that??
Answer by Vinay Dora, November 27, 2016:
There are a few beauty and cosmetics projects that have leveraged Kickstarter, however not many have taken this route. My understanding is that aggregator platforms like Kickstarter may not have the right kind of early-adopters for beauty\cosmetics projects. Beauty/cosmetics being a niche as mentioned, currently brands sell their products on their websites. It may be good time to explore leveraging a crowdfunding or aggregator platform for this niche too.
Q: Can Crowdfunding really be a pillar in the venture startup, or is it just another hype?
Answer by Michael Gawrys:
Some of the main reasons for why I believe that Crowdfunding is something that will stay for some time are the following:
GROWTH; Since CF has been around for a while now, (at least 5 years) and is still growing, it might not be considered to be “just a hype”.
CHANGE; CF is branching into new areas all the time, and almost independently where in the world and in which environment you are in, you can find a new flavor of CF that may fit.
COMPLEMENT; CF is driven by the goals of important needs, in contrary to many other financing systems that are driven more by economic factors. Thus it is a complement to the existing economic scenario.
LOW RISK; Since most CF projects have many small participating funders, it will not cripple personal finances if the funding project doesn’t perform well.
Q: Can you estimate the impact that Crowdfunding will have on venture creation and economy as a whole?
Answer by Vinay Dora:
Crowdfunding, a 4 billion dollar industry, has seen tremendous growth over last 18 months with the JOBS Act moving ahead to legality and several equity crowdfunding setting shop in parts of Europe, where it’s permissible. The European Crowdfunding Network (ECN) has aptly presented this message to the EU decision-makers – “Through crowdfunding, entrepreneurs will have access to capital, create innovative products and services, create jobs and contribute to economic growth. Crowdfunding is a more reliable, long-term and local investment method than any other investment method in the market and it will help to stabilize the financial system.” This statement sums it up.