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A possible change in MMO Crowdfunding?

Muerte_XMuerte_X Member Posts: 104
in The Pub at MMORPG.COM

The SEC is looking to allow actual investment via crowdfunding. This might change future Kickstarter and other crowdfunding sites to allow direct investment into these companies, instead of the current model of promising future product.

Article here:

http://www.foxbusiness.com/economy-policy/2013/10/23/sec-gives-crowdfunding-green-light/

So we might see indies like Pathfinder Online and The Repopulation (Above & Beyond Tech) able to "double dip" on crowdfunding. They have done Kickstarters, but if this rule is adopted, they could do a second round for actual equity stake in the company. It really opens up a great secondary fundraising source, but at the cost of cutting into future profits.

This regulation change has the potential to drastically alter Kickstarter and other crowdfunding sites. Overall I think it creates another great option for companies looking to get off the ground, and I hope these changes are adopted.

Often lurking, rarely posting

Comments

  • LoktofeitLoktofeit Member RarePosts: 14,247
    Originally posted by Muerte_X

    The SEC is looking to allow actual investment via crowdfunding. This might change future Kickstarter and other crowdfunding sites to allow direct investment into these companies, instead of the current model of promising future product.

    Article here:

    http://www.foxbusiness.com/economy-policy/2013/10/23/sec-gives-crowdfunding-green-light/

    So we might see indies like Pathfinder Online and The Repopulation (Above & Beyond Tech) able to "double dip" on crowdfunding. They have done Kickstarters, but if this rule is adopted, they could do a second round for actual equity stake in the company. It really opens up a great secondary fundraising source, but at the cost of cutting into future profits.

    This regulation change has the potential to drastically alter Kickstarter and other crowdfunding sites. Overall I think it creates another great option for companies looking to get off the ground, and I hope these changes are adopted.

    What makes you think these games don't already have both crowdfunding and investors?

    There isn't a "right" or "wrong" way to play, if you want to use a screwdriver to put nails into wood, have at it, simply don't complain when the guy next to you with the hammer is doing it much better and easier. - Allein
    "Graphics are often supplied by Engines that (some) MMORPG's are built in" - Spuffyre

  • Muerte_XMuerte_X Member Posts: 104
    I am sure these games do. This will simply open up a new and different method of funding. Perhaps I should not have given specific examples as this will most likely have an impact on future MMO funding, but maybe not on the examples I gave.

    Often lurking, rarely posting

  • GrumpyMel2GrumpyMel2 Member Posts: 1,832
    That's pretty cool. It really was a horrible nanny-state rule that prevented regular people from investing small amounts in small business ventures. They let a person waste thousands each year on lottery tickets but investing a hundred or two in a small business that might actualy see some return - that was forbbiden "for our own good" - yeah, that really makes sense.
  • iridescenceiridescence Member UncommonPosts: 1,552

    Cool, I would love the chance to invest a small amount in a game which I really like and believe will be successful. If they can raise more money doing this, good.

     

  • TorikTorik Member UncommonPosts: 2,342
    Originally posted by iridescence

    Cool, I would love the chance to invest a small amount in a game which I really like and believe will be successful. If they can raise more money doing this, good.

     

    If you are interested I know this Nigerian prince who started his own gaming company and needs help transfering funds out of his country. :)

  • iridescenceiridescence Member UncommonPosts: 1,552
    Originally posted by Torik
     

    If you are interested I know this Nigerian prince who started his own gaming company and needs help transfering funds out of his country. :)

    :) Well, it goes without saying that something like this would be "investor beware"...

     

  • Muerte_XMuerte_X Member Posts: 104
    Originally posted by iridescence
    Originally posted by Torik
     

    If you are interested I know this Nigerian prince who started his own gaming company and needs help transfering funds out of his country. :)

    :) Well, it goes without saying that something like this would be "investor beware"...

     

    Actually compared to the current vetting process for Kickstarters, this might enhance confidence in investing. The SEC will require audited financials, which is something you do not see currently. The devil is in the details, but overall it will be more regulation/safeguarding than current Kickstarts. All of that of coarse does not guarantee an ROI or that whomever gets the money does not suddenly take a loooong vacation in Aruba.

    Often lurking, rarely posting

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