Do you want to see the role of crowdfunding expand?

Kickstarter and other sites allow artists, authors, and inventors to fund projects through small donations from many supporters. But soon people may be able to actually invest — and see a return on that investment — through a similar model.

NPR reports:

The Securities and Exchange Commission is considering rules that, for the first time, would allow small companies to solicit investments over the Internet and sell shares to the general public.

Currently, private companies are only allowed to solicit funding from accredited investors — essentially wealthy people with a net worth of $1 million, excluding their homes. But the new rules would allow companies to raise as much as $1 million a year from lower net worth people by selling shares.

These investments could return great rewards to the businesses’ crowdfunders, but they could also fail.

Today’s Question: Do you want to see the role of crowdfunding in the economy expand?

  • Pearly

    Absolutely! This is HUGE!

  • Gary F

    As with everything, there will be good and bad things with this. One good thing is that people will actually become capitalists, and not socialists, and have some skin in the game. This could inspire a whole new class of entrepreneurs. But then, there will be sharks and swindlers, and the people who bet the farm on bad ideas.

    I like the idea.

    • reggie

      Aside from the shot at socialists, I agree. (As for socialists, what is more socialist than taxpayers bailing out big banks?)

      Anything that encourages grass-roots entrepreneurial activity is worth trying, with the caveats you note. There will always be con folks out to fool the gullible. Once we get these funding mechanisms in place, let’s get a full, single-payer national health system going, and really unlock some entrepreneurial zeal.

    • Jim G

      Gary F,
      I agree with Paul J. There’s no reason to bash socialists. Although, some might want to categorize me as one because I support Social Security, Medicaid, SNAP, and Medicare; I can also be a lumped with capitalists because of my business associations. However, I jumped on the opportunity to agree with you on something…finally. 😀

      • Gary F

        Problem is right now is our government thinks they are necessary for business and people to succeed, e.g. green energy, GM, Chrysler, Mn Vikings, banks, to name a few. If the government let business and let productive people succeed and let bad ones fail, we wouldn’t be in the mess we are.

        • Jim G

          In my view, Washington and state governments are being milked by big business lobbies. If the Feds ever go bankrupt, as the doomsayers predict, then where will all these business interests go for their wealth-fare payments?

        • reggie

          Problem is right now business is in full Darwin mode. The CEOs make their millions while the working stiffs suffer. Why do we let a highly profitable company like WalMart pay its workers so little that we (taxpayers) must subsidize those low wages through welfare programs? Who is the socialist in this equation? I’d say it is the Walton family and their minions on Wall Street.

          While we’re on an “agree with Gary” track, I’d agree we should let bad businesses fail.

    • david

      There you go using the S word again. Would be terrible if we allowed socialism into the country! The horror!! Its not like the military, police department, fire department, border patrol, road building, road maintenance, water department, sewer department, epa, FCC, sec, NSA, FBI, CIA, DNR, dot, city county state federal corrections agencies, or even city state county federal government has ever done anything worth while for the people of the country.

      • mason

        Apparently you don’t even know what socialism means. It has nothing to do with roads, police, or fire departments.

        • david

          Calling Obama or Democrats socialist is way more inaccurate, but hey it makes a good bogeyman to scare the stupid into voting a particular way.

  • Rich in Duluth

    Sure, people like to gamble, so the SEC should legalize this form of gambling.

  • PaulJ

    The SEC creating an unsophisticated investor versus the sophisticated entrepreneur market could just be a way for the Federal revenuers to muscle in on my snake oil pyramid.

  • Jim G

    Yes, it sounds like a good idea. At last, a tool which allows creative people to access money for legitimate business pursuits other than tapping the rich uncle (What rich uncle?) and/or going to a bank, pay-day loan-shark, or the bookie down the street. I like It!

  • JQP

    the old system is too high a hurdle for small companies on thin margins … and … excludes a lot of capital from the only reliable wealth generator in a country that has depressed wages over the years.

    Anyone, however, who would participate in that market should get some training. Its simple to buy … but can be complicated to own and sell , for tax reasons, later on.
    Sort of like marriage …

  • david

    Yes, I am surprised is wasn’t already allowed.