April 17, 2024 The Best Source of News, Culture, Lifestyle for Culver City, Mar Vista, Del Rey, Palms and West Los Angeles

Westsiders Show Enthusiasm for Crowdfunding

marble-and-frenchie
CrowdfundX CEO Darren Marble introduces Sunny Barkats, who runs a fund, Thunder Crowd Capital, that helps startups market their crowdfunding campaigns.

Many Westsiders like to brag about how rarely they go east of the 405.

But quite a few Westsiders made their way downtown last week for the Crowd Invest Summit, held at the LA Convention Center December 7 and 8.

At this conference, crowdfunding leaders talked about what has been learned so far in the Brave New World of crowdfunding (crowdfunding only went into effect earlier this year).

Entrepreneurs seeking capital for their startups were all ears.  A huge room was quite full.

The consensus seemed to be that the industry was still “at the beginning of the beginning,” and that crowdfunding is poised to take off in 2017.

ronmiller
Ron Miller, co-founder of StartEngine, has been predicting for years that crowdfunding would one day be huge.

Crowdfunding, like much of venture capital, seems to draw heavy interest from white males.  Several speakers suggested it was important to diversify – and that crowdfunding offered a terrific opportunity for startups often overlooked by traditional VCs.

peterliuandrichardwolpert
Venture capitalists Peter Liu and Richard Wolpert. Wolpert recently started “HelloTech.” He is also the founder of Amplify.LA, an accelerator in Venice.

Many speakers speculated that pro-business President Donald Trump would be sympathetic to reducing remaining regulatory hurdles that have held crowdfunding back.

Crowdfunding comes in several flavors these days, with two particularly popular right now:

1) Reg A, raising money from accredited (high net worth) individuals.  A company using Reg A+ can raise up to $50 million in a year and shares are fully tradeable, or liquid; and

2) Reg CF, which allows crowdfunding raises of up to $1 million a year, which can include non-accredited investors.

marinalee
Angel investor Marina Lee of the Women in Tech Network, headquartered in Silicon Beach, and Kerri Affronti. Affronti specializes in the GYROTONIC method, a movement system that teaches seniors how they can exercise pain-free. Affronti has a health clinic start-up she’s working on that will treat non-communicable diseases through exercise and nutrition programs.

Crowdfunding uses online platforms to match those seeking capital with those wanting to invest in startups.  It’s all pretty easy compared to how funding used to get done – which could only include accredited investors and there was lots and lots of legal paperwork involved.

popsicles
BuzzPop’s multi-flavored popsicles, super-charged with alcohol, were a big hit with the pitch panel judges.

It’s also legal to advertise one’s fundraising efforts.  This was not the case prior to the passage of the JOBS Act (Jumpstart Our Business Startups) passed with bipartisan support and signed by President Obama in 2012.  It took several years for the SEC to establish the rules that would guide the implementation of crowdfunding.

distld
DSTLD manufactures high-end denim clothing here in Los Angeles.

The Crowd Invest Summit was produced by Darren Marble, CEO of CrowdfundX, Josef Holm, CEO of Krowdster, and Alon Goren, CEO of InvestedIn.

CrowdfundX CEO Darren Marble introduced many of the two-day program’s segments, often serving as moderator for panel discussions.

CrowdfundX doesn’t directly raise money for startups; CrowdfundX helps those running crowdfunding campaigns market those campaigns. CrowdfundX and Santa Monica-based StartEngine helped Elio Motors raise $17 million earlier this year, using the Reg A+ model.

CrowdfundX is based out of West Los Angeles, with offices on Olympic, near Bundy.

herjavec
Robert Herjavec, right, of Shark Tank fame.

StartEngine co-founder Ron Miller was visible throughout the conference, as was his co-founder Howard Marks.

Several deals were pitched during the gathering.  Two in  particular grabbed attention: 1) Fanwide, an app that connects sports fans with bars and restaurants that will be showing a particular game; and 2) BuzzPop, a frozen popsicle loaded with all-natural ingredients and alcohol – perfect for outdoor gatherings on a hot day.

jennifer
Jennifer Eden, right, founder of Tampon Tribe.

Jennifer Eden of Santa Monica is raising money for Tampon Tribe, a company that sends 100% cotton sanitary products to women via the mail once a month – much the same way Dollar Shave Club operates, only Dollar Shave Club offers products targeting young men.

And just as Tom’s Shoes donates a pair of shoes to those in third world countries for every pair of shoes bought here in the U.S., for every purchase, Tampon Tribe sends a second batch of sanitary products to indigent women, including homeless women in the Santa Monica/Venice area.

Tampon Tribe’s deal can be found on WeFunder.com.

hygen
Paul Dillon of HyGen.

Brentwood resident Paul Dillon, CFO of HyGen, was there to show off a new hydrogen fuel cell electric vehicle from Toyota.  The original source for our hydrogen is water.

Hydrogen combines with atmospheric oxygen in the fuel cell, creating a current which drives the electric motor. The only byproduct is water vapor.

More and more car manufacturers are jumping on the hydrogen bandwagon.  The in-car storage tank issues have been solved, but lack of fueling stations remains a slightly limiting factor.

Hydrogen fueling stations are springing up all over Los Angeles now, according to Dillon. Companies like HyGen are busy building more, he added.

markgondafernandez
Howard Marks of StartEngine, Richard Gonda of Santa Monica-based Ignite Capital Partners and Manny Fernandez of DreamFunded.com, a crowdfunding platform based out of Silicon Valley.

Richard Wolpert is a co-founder of Amplify.LA, an accelerator based in Venice.  Wolpert recently started HelloTech, which pairs people needing help with their home technology challenges and young people with the skills to provide the help.

ronn
There were lots of cool-looking cars all around, with several manufacturers seeking funding. This one is from Ronn Motor Group.

Wolpert was a speaker during the “How to Think Like a VC” panel.  He cautioned investors and entrepreneurs to not get too excited about “the next shiny new thing.”  He said sometimes people jump into a new field too early and get washed out before the real opportunity arrives.

massey
Gene Massey, left, is CFO of “Starring Clara Bow.”  Barry Fasman, right, is CEO.

Gene Massey, CEO of Westwood-based Media Shares, is helping raise money for an old-style musical called “Starring Clara Bow.”  Bow was a star of the screen back in the 1920s.  The play is written by Jeffery Mundy, a cook working on a tugboat; Barry Fasman is the composer and CEO.  This campaign can be found on StartEngine.com.

In between sessions, there was a lot of networking going on.  Stay tuned to see which deals get funded in 2017.

dara
Dara Albright, left, has been a pioneer of the crowdfunding movement from the beginning.
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