Crowdfunding has been a buzzword since Kickstarter launched a few years ago, but now its becoming a more common way for people to invest in not just goods, but companies and ideas. Earlier in 2015, Gov. John Hickenlooper signed into law the Colorado Crowdfunding Act to help companies source investments from the crowd.
Newly launched Invest Local will help coordinate and manage those small investments. It's already hosting events to help people learn more about investing through crowdfunding.
"The potential of investment crowdfunding in providing capital needed by Colorado small businesses is tremendous," says Invest Local President Karl Dakin. "There are an estimated 4.3 million non-accredited individuals and over 700,000 businesses that may now invest through crowdfunding. If each of these individuals and businesses were to invest only $1, they could fund five businesses up to the $1 million limit (unaudited financials) under the Colorado Crowdfunding Act. That's $5 million new dollars invested in Colorado. If each of these same investors invest $100 each year -- $1 each in 100 different Colorado businesses, that's half a billion new dollars invested in Colorado -- each year. The positive impact upon Colorado's economy is immeasurable."
It's the type of thing that Invest Local specializes in connecting investors with opportunities. Under the new law, organizations are required to use a registered intermediary such as Invest Local to manage small dollar investors. To help accomplish that Invest Local is serving as a FundPaaS value-added reseller. "We searched out a crowdfunding platform that is adaptable to different types of crowdfunding, compliant with federal and state laws and regulations and which can keep the costs of crowdfunding affordable to the small business. FundPaas met all of these criteria. We look forward to working together with FundPaas in supporting thousands of Colorado businesses, social enterprises and community projects in raising the money they need," Dakin explains.
To help people understand the opportunity, Dakin is hosting events like the Main Street Investing Workshop at Colorado Lending Source on Dec. 17. The $100, half-day course will provide attendees with a scorecard to help them better evaluate crowdfunding investment opportunities and help them compare it to other opportunities using both objective and subjective information.
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