From the NY Times, Retail Businesses That Try Crowdfunding Face Some Skepticism:
After nine years in Brooklyn, the Chocolate Room — a popular purveyor of wine, cake, candy and coffee — experienced one of those cataclysmic events retailers fear: a crippling rise in rent. Informed in late 2012 that they would face an increase of more than 500 percent, the cafe’s owners, Naomi Josepher and Jon Payson, reluctantly decided to abandon their space and begin figuring out how to finance a $200,000 relocation.
The couple are still paying off private and family loans for their start-up costs. So Ms. Josepher and Mr. Payson took a suggestion from their customers and started a crowdfunding campaign on Kickstarter. Word spread quickly, and by the third day, the shop had more than $1,000 pledged toward its goal of $40,000.
Donating via Kickstarter is like buying stock in a company only… only… only you don’t get any shares in exchange for your money. You have to admit that certainly simplifies the exchange. It’s a wonder that crowdfunding of for-profit businesses isn’t more popular.
Notes:
- To be fair, follow the link above and you discover that The Chocolate Room was offering something in exchange for your donation, e.g., a $250 pledge got you a 9 inch layer cake.
- Hey, don’t laugh. It’s probably really good cake.
- Upon learning of #1 John Mackey convened an emergency meeting to re-evaluate Whole Foods’ price points.
- No, he didn’t. (At least not to the best of my knowledge.)
- Would I sign over my next paycheck to my employer in exchange for a company logo lapel pin? No. But maybe that’s just me.