by Ron Ben-Zeev*
That is the question I asked myself a few months ago. I was listening to Brian Meece, Founder and CEO of RocketHub, the third largest such platform in the U.S., who was speaking at a Start-up Weekend event I co-organized in Orlando, Florida.
Crowd funding or crowdfunding (alternately crowd financing, equity crowdfunding, or hyper funding) describes the collective effort of individuals who network and pool their money, usually via the Internet, to support efforts initiated by other people or organizations.
As Brian was speaking, my mind was spinning in many directions. Can this help my start-up? How? Can the funds raised make a true difference or is the potential exposure enough?
I had heard and read about the outliers, the companies who had set out to raise a certain sum only to exceed that sum by a huge factor, millions in some instances. The majority of those seeking to raise funds, if they raise their target amount, raised only a modest sum. However, these small sums reached an excess of $2.7 BILLION and have funded more than 1 million campaigns, in 2012, as a worldwide aggregate. A study by Massolution forecasts an 81% increase in global crowdfunding in 2013 to $5.1 billion. This trend is forecasted to continue growing at a hockey stick rate.
With that knowledge in hand, I approached Brian and discussed with him my current venture, (once an entrepreneur, always an entrepreneur), called World Housing Solution. Through World Housing Solution Inc. (WHS) my partners and I developed a revolutionary solution to today and tomorrow’s emergency, temporary and affordable housing needs. We use Space Age composite-sandwich-construction methods to develop rapidly deployable and reusable shelters and structures.
WHS has brought innovation to the way emergency personnel, Non Government Organizations (NGO), Charitable Organizations (e.g., Habitat For Humanity, Red Cross) and the Military can deal with short and long-term housing and building facility needs. The reusable shelters and structures can be used to respond to natural disasters, military deployment, and temporary labor housing needs. Our movable factory can also be built anywhere to address short and long term housing needs. WHS’s revolutionary approach is tailored made to address the needs for affordable secure and comfortable housing worldwide.
Although we had made some headway in getting noticed by the government and had won a few contracts, we were starving for exposure and capital. With that in mind, we dove headlong into a crowdfunding campaign. When we decided to engage in this process, we had two goals in mind. The main one was exposure and the second one was raising a small sum of money for R&D.
So how did we do?
The campaign is still ongoing. However, on the exposure side, we hit the jackpot. It turns out that RocketHub was quietly working with the cable TV Network A&E TV to establish a strategic partnership affording both an interesting storyline for them as well as exposure for those nascent organizations. Along with RocketHub, they launched a multi-platform initiative called PROJECT START-UP and selected WHS as one of the first projects to be featured. We are still trying to figure out exactly what it means, both in the short and long term.
One thing is certain; crowdfunding has come through on its promise of exposure. Like anything else that comes along during your entrepreneurship journey, it is what you do with those opportunities that truly matter. We were given a spark and we are trying to turn it into a raging inferno. One that has a great social agenda attached to it. Will you come on the journey with us?
*Ron Ben-Zeev is a Wharton Alumn ’86 and a member of the Wharton IGEL Alumni Advisory Board.