Process of Crowd Funding-Free-Samples for Students -Myassignment

Question: Define and explain the meaning of Crowdfunding and how it actually works as a mechanism for capital raising. Answer: Introduction Crowd funding is a process through which finances are created by large number of people. This method is used by the Entrepreneurs who are unable to source from the traditional sources. This technique helps in connecting the small financers through internet[1]. These small financers include family members, friends and relatives who are looking for investment. The concept of Crowd funding is new to Australia. The Common Wealth Government has made new regulations for the small Entrepreneurs[2]. Crowd funding has gained popularity among the small entrepreneurs due to the upcoming tradition of start-ups. The report provides different procedure of crowd funding and evaluate different opportunities available in the market. There are different relevant theories associated with the concept of crowd funding. Lastly the report will focus on the legal Regulations in USA regarding crowd funding. Process of Crowd funding In the modern economy, people do have a direct access to internet to meet their requirements. The change in society has allowed in building the concept of crowd funding. In the recent time, there is an increase in the number of entrepreneurs. An increasing number of entrepreneurs are creating a need for more investment. The traditional investors tend to support large entrepreneur decreasing the scope for the small entrepreneurs[3]. This is the reason, crowd funding has gained popularity in most of the nations in crowd funding, and a large number of buyers are making an investment in small portions. This helps in raising the fund in order to start the venture. Funds can be raised through 4 different methods selected by the entrepreneur on the basis of the project. In case of Inlending-based crowd funding, the fund provided by the financers is called as debt. The entrepreneur has to pay off the debts and interest. The reward base method is based on providing the incentives to the finan cers. This method helps in attracting people for funding a project. Donation based funding is used by the NGOs for raising fund due to some charitable cause. The equity based crowd funding method is used by small sized companies in which shares are allotted to the investors. The reward based method is used by the financers to attract funds from different financiers. There is a necessity to follow an appropriate technique to raise fund from the crowd funding method. These guidelines are mandatory for following the crowd funding process[4]. It is important to provide with the mandatory guidelines to the potential investors and the entrepreneurs. The information brochure includes every bit of information about the venture. The project include price of the project, specification and time frame in which fund can be recovered. The information has to be collected from the available accessible offers available for crowd funding[5]. Example of Social and Social Crowd Funding In reality, there are various entrepreneurs who uses crowd funding to fund the project. There are several online portals providing with crowd funding solutions. The examples of such crowd funding project are Indigogo, Kickstarter, GoFundMe, and MyCause. The purpose of these websites is to provide with funding facilities in Australia. The purpose of these websites is to generate fund for the small entrepreneurs finding difficulty in raising funds. These websites help in raising funds for the small entrepreneurs[6]. Pebble Time is known as a successful crowd finding project attracting people across the world with their smart watches technology. The crowd funding page of the company has raised a sum of $ 20 million through their 80 thousand investors. Kickstarter is another example of online crowd sourcing portal raising funds for the entrepreneur. They have provided fund to 22 million entrepreneurs by raising a fund of $ 500 million in 2014[7]. The online services help in fostering inv estment which in return helps in economic development. The purpose is to meet the target by following the process of crowd funding. Flow Hive is an Australian corporation harvesting honey through different ways. These campaigns are important for the growing business organizations. This process is important for generating fund. The popularity of crowd funding has generated a wide scope. Apart from commercial companies, there are social organizations that generate funds from the process of Crowd sourcing. MyCause is a fund raising website collecting fund for the social cause. The money raised by this website is used to help those in need. People are gaining awareness through these websites. Crowd funding regulations As per the recent law and regulations, the process of outsourcing is important enough to meet the requirements of crowdsourcing. There are majority of countries that help in enhancing the process of crowd funding. Australia has implemented provision regarding the process of crowd funding. The Corporations Amendment Act 2017 is enacted to look after the regulation for protection from fraud[8]. The Act provides several provision of Corporation Act 2001 in order to provide different exemptions in order to use crowd funding method. There are regulations Australian Securities and Investments Commission Act 2001 do have amended the changes taking place in the market. This act basically limit from investing more than ten thousand dollars over crowd funding annually. There are wholesale investors not restricted from making investment in crowd funding project. The amount of investment is limited by law. The assets capitalization below $ 5 million can raise investment by the process of crowd funding[9]. USA and UK doesnt have restrictions regarding the crowd funding project. The Job Act 2012 provides with the regulations pertaining to the process of crowd funding. The financers do have an authority to spend as per the financial status. Crowd funding is a common process in all over USA[10]. The regulation crowd funding in USA is managed y the Security Exchange Commission. The Australian law restricts people from generating large funds through the process of crowd funding. The crowd funding campaigns are able to reach out to a limited market segment. This reason actually restricts the crowd funding process. A limited access to the crowd funding is creating problem in growth. There is a problem in generating fund due to restricted availability of crowd sourcing process. An increasing number of entrepreneurs are creating a need for more investment. The traditional investors tend to support large entrepreneurs decreasing the scope for the small entrepreneurs[11]. Observation In the recent time, the process of crowd funding has gained recognition among the small scale entrepreneur and business corporation. This is a modern method that allow in raising fund from small entrepreneurs. A majority number of countries have implemented an effective crowd funding plan to gain consideration. Australia has implemented the law in order to manage the business functions in an appropriate way. There are many experts who are criticizing the policies established by The AUSTRALIAN Government regarding the process of Crowd funding. There is a need of a proper rules and regulations governing the process of crowd funding. The most effective part of this concept is regarding the process of crowd funding due to the restricted government regulations. It is necessary to liberate the rules and regulations. This process is effective enough to manage the consequences attached with the process of crowd funding. As per the given circumstances, the regulations regarding Crowd funding in Australia is strict. UNITED States, rules and regulations regarding crowd funding is lenient, there are maximum number of people who are generating funds through the process of Crowd funding in USA. Small sized entrepreneurs are benefitted by the process of crowd funding. This process is important for the development of the economy and growth. This creates better employment opportunities reducing the burden on economy. This process has supported many businessmen in raising funds. Small sized organizations are benefitted by the process of crowd funding. Kickstarter is a US based crowd funding organization providing funds to people. The company provides fund to the people through their online portal. The 3Doodler is a 3D printing pen that lets anyone draw in 3D. With $2,344,134 it raised in 34 days, over 26,000. Kickstarter backers earned the rewards within a year after the fundraise ended[12]. With so many changes in the market, it is important to implement an effective crowd funding policies. These policies help in raising funds from the investors across the world. Australia needs to reduce the legal restriction on the process of crowd funding. It is important to provide with the mandatory guidelines to the potential investors and the entrepreneurs. The information brochure includes every bit of information about the venture. In order to gain future advantage, it is important to implement an effective crowdsourcing regulation. These regulations will help in developing the process of crowd funding in Australia. The provisions in Australia are in accuracy with the organizational structure helping in gaining long term sustainable resources. The traditional investors tend to support large entrepreneurs decreasing the scope for the small entrepreneurs. This is the reason, crowd funding has gained popularity in most of the nations. In crowd funding, a large number of buyers are making an investment in small portions. While making a decision regarding the decision making it is evident to develop an effective policies helping in gaining a competitive advantage[13]. Over the past few years, there is an increase in the number of start ups across the world. In this scenario it is suggested to Howard Jones to increase the life of the batteries. This will gradually help in putting the things at the right place. It is possible to collect fund from the crowd funding method. This method will help in generating fund. The company will help in generating better opportunities for the business organization. The information brochure includes every bit of information about the venture. The project include price of the project, specification and time frame in which fund can be recovered. Crowd funding is a process that help in managing a venture. In this way, it is possible to manage the organization in an effective way. The Common Wealth Government has made new regulations for the small Entrepreneurs. Crowd funding has gained popularity among the small entrepreneurs due to the upcoming tradition of start-ups[14]. Conclusion It is clear that the crowd funding helps in generating fund for the small size entrepreneurs the process helps in ensuring that the organization is getting support. The online services help in fostering investment which in return helps in economic development. The purpose is to meet the target by following the process of crowd funding. People who are interested in the process can make an investment in order to gain competitiveness. The crowd funding process is important from the point of view of economic development. Howards Jones can select the method of crowd funding in order to start business. This will help in managing the business related expenses in a better way. The method of crowd funding is comparatively better than rest of the traditional technique. The online websites is providing with the better options. There are majority of countries that help in enhancing the process of crowd funding. Australia has implemented provision regarding the process of crowd funding. In order to manage funds, it is evident to find out the appropriate way to raise the funds. There is a problem in generating fund due to restricted availability of crowd sourcing process. An increasing number of entrepreneurs are creating a need for more investment Bibliographies Books/Article/Journals Bruton, Garry, et al. "New financial alternatives in seeding entrepreneurship: Microfinance, crowdfunding, and peer?to?peer innovations."Entrepreneurship Theory and Practice39.1 (2015): 9-26. 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