I want you to imagine a scenario. It's a classic
setup. You have an idea. And not just a wouldn't
it be nice kind of idea, but a burning keep you
up at night idea. The kind that you're scribbling
on napkins at 3 in the morning. Exactly. Maybe
it's a cooler that has a built -in blender for,
you know, beach margaritas. Maybe it's a video
game that simulates an entire living galaxy.
Or maybe, and this is a real example, you simply
want to make... The world's best potato salad.
The potato salad example is actually crucial
here. Do not underestimate the potato salad.
Oh, we are definitely, definitely getting to
the potato salad later. But here's the reality
check. Traditionally, if you wanted the money
to make that idea real, you had a very specific,
very narrow path. A very intimidating path. Totally.
You had to put on a suit. probably an uncomfortable
one walk into a bank and sit across from a loan
officer. And you had to convince this one person
who essentially holds your fate in their hands
that your potato salad was a viable business
model with a projected ROI. Or if you were in
the tech world, you were pitching to venture
capitalists on Sand Hill Road. And, you know,
they generally only care about one thing. Is
this going to give me a 10x return? Can this
be a unicorn? Exactly. It was a gatekeeper model,
a centralized model of finance where a tiny,
tiny group of people with money decided what
the rest of the world got to see, use, or play.
It was high friction, high barriers to entry,
and usually a massive allergy to risk. If it
didn't fit the standard box, it didn't get funded.
End of story. But now I want you to flip the
script. Delete the bank manager. Delete the boardroom.
Instead, imagine a swarm. thousands, maybe tens
of thousands of strangers on the Internet. A
crowd. A crowd. And they don't want equity necessarily.
Maybe they just want a taste of the salad or
they think the pitch video is funny or they just
believe in the mission. They each throw in 10
bucks, 20 bucks. Suddenly you have capital. You
have a market. You have momentum. And crucially,
you have bypassed the traditional financial intermediaries
entirely. You have, in a sense, democratized
the capital race. Today we are doing a deep dive
into crowdfunding. But, and I want to be very
clear about this right up front, we are not just
talking about buying cool gadgets on Kickstarter.
That's the surface level. That's the tip of the
iceberg. Right. Because when you really look
at the stack of articles and reports we have
here, crowdfunding has morphed into something
much more significant. I mean, it's reshaping
how we build skyscrapers, how we fund scientific
research, how we pay for high stakes lawsuits,
and perhaps most concerningly, how millions of
people are paying for basic health care. We have
a massive stack of reports, historical data,
and case studies to get through today. We're
going to look at the history, which, spoiler
alert, goes back way further than the internet.
We're going to break down the different weird
and wonderful mechanics of how it works, look
at the biggest successes and failures, and then
really get into the ethics of it all. It's a
huge topic. It is. So let's unpack this. What
exactly are we dealing with when we say crowdfunding?
At its core, the definition is pretty simple.
It is the practice of funding a project or venture
by raising money from a large number of people,
typically, but not always, via the Internet.
Okay. Simple enough. Yeah. And it's considered
a subsector of crowdsourcing, and it falls under
this big umbrella term of alternative finance.
Alternative finance. It makes it sound so underground,
like we're meeting in a parking garage to exchange
briefcases full of cash. Well, it used to be
a bit fringe, but the numbers are just staggering
now. I was looking at a report that showed as
far back as 2015, over 34 billion U .S. dollars
was raised worldwide through crowdfunding. 34
billion in 2015. Yeah, and the projections for
the future are even more wild. Some suggest that
by 2025, the industry could reach $1 trillion.
Trillion with a T. With a T. So while we might
think of it as a way to buy a cool backpack or
a board game, structurally, it is becoming a
real pillar of the global economy. It connects
the project initiator, the person with the idea,
directly to the crowd, usually through a platform
that mediates the exchange for a fee. So it effectively
removes the friction of distance and the friction
of, you know, institutional approval. That's
the key. It removes the gatekeepers. OK, so before
we get into the trillion dollar industry it is
today, let's rewind because I think most people.
And I'll admit, myself included, until I read
these notes, assume this whole thing started
with Kickstarter or maybe Indiegogo in the late
2000s. That's the common perception, yeah. But
you found some evidence that the crowd has been
funding things for a very, very long time. Much
longer. I mean, the term crowdfunding is new.
It was only coined in 2006 by a guy named Michael
Sullivan. But the behavior. Yeah. That's centuries
old. If you look at, for example, the subscription
model for books in the 17th and 18th centuries,
that was essentially crowdfunding. How did that
work exactly? Was it like a preorder? Pretty
much. An author, let's say Alexander Pope, translating
the Iliad, would say, I intend to write this
volume. He'd advertise it in pamphlets and newspapers.
And people would subscribe. They'd pay up front
to provide the confidence and, more importantly,
the capital to get it printed. So it established
that a market existed before the hard work of
printing actually happened. It de -risked the
whole project for the publisher. You got it.
It's the exact same principle as a modern campaign.
Prove market demand before you manufacture. That's
amazing. It's like a pre -internet Kickstarter
for literature. But my favorite historical example
that we found in the research, and this one really
blew my mind because I walk past it all the time,
has to be the Statue of Liberty. This is the
classic case study. It really sets the stage
for everything that comes later. It has all the
same elements. So pick the picture for us. It's
1885. The Statue of Liberty is a gift from France,
right? Everyone knows that part. Right, a gift
from the French people to the American people.
But the deal was France builds the statue and
America has to build the pedestal she stands
on. A seemingly fair trade, you know, a you bring
the statue, we'll bring the big stone block kind
of deal. Sure. Except the statue is on its way.
It's literally sitting in crates in a warehouse
in Paris ready to ship. But construction on the
pedestal stalls, there's just no money. And it
was a political mess. The governor of New York
refused to use city funds. He actually blocked
it. And Congress couldn't agree on a federal
financing package. It looked like the statue
was going to end up in pieces in a storage warehouse
or maybe even shipped back to France. Imagine
the humiliation, a massive symbol of freedom.
And we were too cheap to build the base. It's
almost comical. It's deeply ironic. And that's
when Joseph Pulitzer steps in. Yes, that Pulitzer.
He owned the newspaper The World. And he decides
to launch a campaign in the paper. He basically
says. We aren't waiting for the millionaires
or the government. The people are going to build
this. And he used a very modern crowdfunding
tactic, didn't he? He offered a reward. He did.
It was recognition. He promised to publish the
name of every single person who donated, no matter
how small the amount. Whether you gave a dollar
or a dime, your name was going in the paper.
And it worked. I mean, it didn't just work. It
was a massive success. They raised over $100
,000. Which in today's money, that's roughly
$2 million. So it was a serious amount of capital.
But here's the stat that I love, the one that
I think defines this whole episode. 160 ,000
people donated. Which implies the average donation
was incredibly small. We're talking cents, not
dollars. That's it. We're talking about waiters,
children, regular folks sending in 15 cents or
a dollar. It wasn't a few rich guys writing big
checks. It was a tidal wave of pocket change.
And that democratized the ownership of the monument.
It wasn't built by a tycoon. It was built by
the crowd. And that psychological buy -in is
something we still see today. When people fund
something, they feel a sense of patronage, of
ownership. They aren't just consumers. They are
builders. They own a piece of the story. You
know, we also saw this with war bonds, right?
The principle is similar. Theoretically, yes.
War bonds are essentially crowdfunding military
conflicts. You are asking the public to lend
money to the government to fund a war, usually
based on a strong patriotic appeal. And we found
other examples, like Cairo University in 1906.
Yeah, that was a fascinating one. Mustafa Kamal,
a nationalist leader, ran ads in a newspaper
asking specifically for donations to start a
university to help pay off national debt. School
children donated, farmers donated. It's the same
impulse. And then there's Auguste Comte, the
French philosopher. This one feels very modern,
almost like a Patreon. Totally. In 1850, he actually
issued notes to the public to support his work.
He was essentially crowdfunding his own life
and philosophy. He sent out circulars asking
for support from his followers. It's not so different
from a creator today having a Patreon to support
their video essays or their art. So the impulse
has always been there. We like supporting things
we believe in, but the internet obviously changed
the scale. It removed the friction. When did
that digital switch really flip? There are a
few key moments, and the music industry was actually
a huge pioneer here. In 1997, the British rock
band Marillion couldn't afford to tour the U
.S. Their label wouldn't fund it. Okay, a classic
problem for a mid -level band. Right, but their
fans... and this is the amazing part, without
the band even asking, initially organized an
internet campaign and raised $60 ,000. Wait,
the fans organized it themselves? How? Yeah,
through online mailing lists and early internet
forums. They just did it. The band eventually
heard about it, accepted the money, and used
it to tour. It was a massive light bulb moment
for the industry. They realized, we don't need
a record label to front us the money. Our fans
will do it. That is the power shift. It completely
cuts out the middleman. Exactly. Then you have
the software world. In 2002, there was the free
Blender campaign. And we're not talking about
a kitchen appliance. We'll get to that later.
This was for 3D modeling software. Ah, Blender.
I know that one. It's huge now. It is. And this
campaign is why. They raised 100 ,000 euros to
buy the source code from the original investors
and make the software open source forever. That
was a huge precursor to the platform era. Then
ArtistShare launched in 2001, which is often
cited as the first dedicated crowdfunding platform
for musicians. And then the big ones came along.
Then the floodgates opened. Indiegogo in 2008,
Kickstarter in 2009, and GoFundMe in 2010. That's
when it really went mainstream. OK, so that brings
us to the modern era. And this is where it gets
really interesting, because I think people tend
to lump all crowdfunding into one big bucket.
I give money. I get a thing. Right. The Kickstarter
model. Yeah. But looking at the breakdown from
the crowdfunding center and other sources, there
are actually several distinct models here and
they work very, very differently. Precisely.
If you want to understand the economics and the
social impact of this, you have to separate them.
The most visible one, the one we all know, is
reward based crowdfunding. OK, so that's your
Kickstarter, your Indiegogo. Right. You are essentially
pre -selling a product or a service. No. You
aren't giving away equity in your company and
you're not taking on debt. You're making a promise.
If you give me $50 now, I will send you this
really cool smartwatch when it's done. And the
backers here aren't really investors in the traditional
financial sense. They don't own a piece of the
watch company. No, they're early adopters. They're
fans. They're patrons. And geographically, this
is fascinating, the funding doesn't rely on location.
You could be in a garage in Ohio raising money
from people in Tokyo, Seoul, and Berlin. But
the research shows nothing interesting there,
right? Even with that global reach, it still
clusters. It does. Funding still tends to track
with traditional finance hubs. Silicon Valley,
New York, London. There's a network effect. But
the barrier to entry is just so much lower. Okay,
so that's rewards. Then you have equity crowdfunding.
This feels like the grown -up table. This is
the high -stakes table, for sure. Here, backers
actually receive shares of the company. They
become part owners. And this was a massive shift
in the U .S., largely due to something called
the JOBS Act of 2012. Yes, the Jumpstart Our
Business Startups Act. It was a complete game
changer. Why was the JOBS Act such a big deal?
What did it change? Well, before the JOBS Act,
you generally had to be an accredited investor
to buy into private companies and startups. Which
basically means you have to be rich, right? Essentially,
yes. You had to have a net worth of over a million
dollars, excluding your house, or an annual income
over a certain threshold. The government's logic,
you know, was that startups are incredibly risky
and they wanted to protect regular people from
losing their life savings on a bad bet. Which
sounds reasonable on the surface. It does. But
it also meant that all the potential upside of
early stage investing was reserved for the wealthy.
The JOBS Act changed that. It allowed unaccredited,
meaning regular investors, to buy equity in startups
through regulated online platforms. So I, a regular
person, can own a tiny slice of the next potential
Facebook or Google. Theoretically, yes. And that's
the dream they sell. But this comes with a huge
economic concept called information asymmetry.
Okay, let's unpack that term, information asymmetry.
It sounds very academic. It does, but it's a
really simple idea. It just means one party in
a transaction knows a lot more than the other
party. In this case, the person asking for money,
the founder, knows way more about the risks,
the technology, and the real potential of their
business than the person giving the money. So
if I buy a stock on the New York Stock Exchange,
that company has to file massive audited reports
with the SEC. I can see their books. Exactly.
There's a baseline of transparency. In equity
crowdfunding, you're investing in a private startup.
They might not have books yet. They might just
have a pitch deck and a prototype. You are fundamentally
trusting the founder's story. You're flying blind
compared to a Wall Street trader. You really
are. And the risks are so much higher. In reward
-based crowdfunding... The worst case scenario
is, you know, you don't get your cool watch.
In equity crowdfunding, you're investing in a
company that's very likely to go bankrupt and
your equity goes to zero. So how do platforms
deal with that risk? Well, one mechanism that's
evolved is the syndicate model. You'll see this
on platforms like AngelList. A lead investor,
someone who is experienced and knows what they're
doing, puts in their own money and does the heavy
lifting on due diligence. And then the crowd
follows them. Exactly. They piggyback on the
experts' research. It's like copying the homework
of a smart kid in class. It reduces the due diligence
burden on the individual and provides a signal
of quality. That makes a lot of sense. Okay,
next up, there's debt -based crowdfunding, which
is also called peer -to -peer or P2P lending.
And this is actually the biggest chunk of the
money in many markets. It's less flashy than
Kickstarter, but the volume is enormous. In 2014,
for instance, something like 75 % of all crowdfunding
money in the UK and US went through PDP platforms
like Lending Club or Prosper. So how does that
work? Is it just like a personal loan? It's very
simple. Borrowers apply online for a loan just
like they would at a bank. But instead of a bank
using its deposits to lend the money, individual
investors like you or me can fund a piece of
that loan. You might put $25 into a loan for
someone's home renovation and someone else puts
in $50 and so on. And the investors earn the
interest. Correct. The platform takes a small
fee for connecting everyone. The borrower gets
their cash and the crowd of investors gets a
return on their money. It's just cutting out
the middleman bank. OK, now for the really niche
ones. The next one is litigation crowdfunding.
This one really surprised me. Crowdfunding lawsuits.
Yeah, this is a fascinating and pretty controversial
corner of the market. It allows plaintiffs or
sometimes defendants to raise money for their
legal fees. But there's a twist, right? It's
not just a donation. No. On platforms like LexShares,
for example, investors can actually buy a stake
in the potential outcome of the case. If the
plaintiff wins the lawsuit and gets a settlement,
the investors get a pre -agreed cut of that money.
That sounds remarkably like betting on a court
case. That's the criticism. It's turning justice
into a speculative asset class. The argument
for it is that it helps people who can't afford
justice to take on big corporations, a classic
David versus Goliath scenario. It levels the
playing field. And the argument against it. is
that it creates a perverse incentive to sue for
profit, not for justice. It could potentially
clog up the courts with speculative lawsuits
funded by people hoping for a big payday. A really
thorny ethical area. And finally, the Wild West.
Digital security crowdfunding. ICOs, DAOs. Right.
Initial coin offerings. This is where a project
offers its own digital tokens or currency instead
of shares or a product. This is all deeply tied
to the world of blockchain and cryptocurrency.
We saw this explode a few years ago. Absolutely.
You had projects like Ethereum, which was initially
funded this way. And then things like the DAO,
which raised a huge amount of money before famously
collapsing. It's a highly complex, highly volatile
and often regulatory gray territory. So we have
rewards, equity, debt, lawsuits and crypto. It's
a huge ecosystem. But let's try to ground this
in some stories because you can't talk about
crowdfunding without talking about the Hall of
Fame. And, of course, the Hall of Shame. The
hits and the misses. And there have been some
truly spectacular ones in both directions. Let's
start with what you called the whale, the biggest
of them all, Star Citizen. You cannot ignore
Star Citizen. It is a video game, an incredibly
ambitious space trading and combat simulator
that launched a Kickstarter campaign way back
in 2012. 2012? That's a long time ago in Internet
years. It is. They raised a couple million on
Kickstarter and then moved the funding to their
own platform. As of early 2025, public funding
trackers indicate it has raised over $900 million.
Nine hundred million dollars. That's more than
the budget of most Hollywood blockbusters combined.
That's major corporate acquisition territory.
And it's all from gamers. Pretty much all from
individual backers buying digital spaceships,
some of which cost hundreds or even thousands
of dollars. But here is the catch, right? It's
been over a decade, and the game is technically
still in alpha. It hasn't had a confirmed full
release date. That's the core of the controversy.
So is it a massive success or a colossal failure?
That is the debate. Critics call it a perpetual
crowdfunding model. They argue it's suffering
from massive scope creep. They keep adding features
instead of finishing the core game. Every time
they raise more money, they promise more things,
which delays the game, which means they need
to raise more money to keep the lights on. It's
a vicious cycle from that perspective. Some have
called it a scam, though that's a strong word.
But the supporters would say what? The supporters,
and there are millions of them, would argue that
they are already playing it. They get regular
patches, new ships, new planets to explore. They
see it as a live service that is funded as it
goes. Yeah. It completely challenges our very
definition of what a finished product is in the
gaming world. It's fascinating. It's almost like
the development of the game is the game for its
community. Okay, so on the flip side of a high
-tech, billion -dollar space sim, you have Potato
Salad. Zach Danger Brown. Yeah. 2014. A legend.
This guy goes on Kickstarter and his pitch is
literally I'm making a potato salad. He said
he hadn't decided what kind yet. His funding
goal was $10. That was it. That was the entire
pitch. He didn't have a business plan. He didn't
have a grand vision for a potato salad empire.
He just wanted to make a salad. And he raised
$55 ,492. $55 ,000. Why? Why did nearly 7 ,000
people give this man $55 ,000 to make salad?
Pure entertainment value. It went viral. It became
a meme. People wanted to be part of the joke.
The stretch goals were hilarious, like, I'll
say your name out loud while I make the salad.
Yeah. It proved that crowdfunding isn't just
about you. It's about community, humor, and performance
art. And he actually followed through, right?
He did. He threw a massive public party called
Potato Stock 2014 with 3 ,000 pounds of potatoes.
He donated a significant amount of the money
to charity. It showed that people will pay just
to be part of a moment. But then you have the
cautionary tales, the ones that go wrong. And
the poster child for that has to be the coolest
cooler. Oh, the coolest cooler. This is a classic
example of the curse of success. It was an all
-in -one party cooler. It had a blender, Bluetooth
speakers, USB chargers. The work. It sounds awesome,
actually. I'd want one. A lot of people did.
They set a goal of $50 ,000. They raised over
$13 million. At the time, it was one of the biggest
Kickstarter campaigns ever. Which sounds great.
If I raised $13 million, I'd be celebrating.
It sounds great until you have to actually manufacture
and ship 60 ,000 complex electronic coolers with
built -in blenders to people all over the world.
The logistics must have been a nightmare. A complete
nightmare. They massively miscalculated the costs.
The cost to make and ship each unit was actually
higher than the price they charged the early
backers on Kickstarter. Oh, no. So every cooler
they shipped, they lost money. Exactly. They
ran out of cash. The company eventually went
under. Many of the original backers never even
got their coolers. It highlights a key risk.
Knowing how to create a viral marketing campaign
is not the same skill as knowing how to run a
global logistics and manufacturing chain. A really
painful lesson for a lot of people. And then
there's the even darker side. Quackery. This
is a really serious issue. Platforms like GoFundMe
and Indiegogo have been heavily criticized for
hosting campaigns for unproven or disproven medical
treatments. You're talking about things that
aren't just experimental but are known to be
ineffective or dangerous. Yes. We're talking
about costly, fraudulent cancer treatments, things
like coffee enemas or dangerous black salve treatments.
Wait, coffee enemas? Yes. Desperate people, often
with terminal illnesses, are looking for any
shred of hope. And scammers or misguided practitioners
use these platforms to fund treatments that has
no scientific basis and can cause real harm.
Which raises big ethical questions about the
responsibility of the platform. Are they just
a neutral pipe for money or should they be vetting
what gets funded on their site? That's the million
dollar question and one the platforms are still
wrestling with. That's a perfect segue, actually,
because we've talked about gadgets and games
and salads. But the mission of this deep dive
was to see how this funding mechanism is applied
in more serious sectors. Let's talk about science,
because if people are funding coffee enemas,
are they also funding real science? They are,
but it's a very double edged sword. There are
platforms like Experian. that are dedicated specifically
to funding scientific research. And the advocates
for this model love it. What's the argument for
it? It helps early career scientists who might
not be able to get traditional government grants,
which are incredibly competitive. It also forces
scientists to learn how to communicate their
work clearly and compellingly to the public,
which is a valuable skill. I can see that, breaking
down the ivory tower. But I imagine there's a
big catch. There is. And critics have a name
for it. The panda bear problem. The panda bear
problem. I have a feeling I know what this is
just from the name. Think about it. If you ask
the general public to fund science, what are
they going to pick? They're going to pick the
cute animals. They'll pick the charismatic megafauna.
They'll pick the projects that sound cool or
funny or have a direct, obvious application.
So Save the Adorable Pandas gets funded, but
a study of the molecular structure of a specific
soil algae that might someday lead to a new antibiotic
gets completely ignored. Precisely. Even if the
algae study is arguably much more important for
human well -being, it's not sexy. It's hard to
make a compelling video about it. Research on
these platforms shows that humor and compelling
visualizations often matter more than the actual
scientific rigor of the proposal in getting funded.
So it risks turning science into a popular contest,
not a meritocracy. That's the core fear of the
scientific establishment. What about journalism?
I remember a platform called Spot .us years ago.
Spot .us was a pioneer, though we eventually
closed. The idea was brilliant on paper. The
public would fund specific reporting pitches
from journalists. An investigative reporter could
say, I want to look into corruption at City Hall.
I need $5 ,000 to do it. And the community could
fund that story into existence. The upside seems
obvious. Journalism that is independent from
major corporate broadcasters and a direct bond
between the reporter and their readers. All true.
But the panda bear problem rears its head again.
It does. Do we only get investigative journalism
about topics that are already popular? Journalism
often needs to cover boring, depressing or complex
things that no one would voluntarily pay to read
about. but are absolutely essential for a functioning
democracy. And there's a conflict of interest
question, too. A huge one. If a specific group
of donors funds you to write a story, do you
feel beholden to them? Do you feel pressure to
write the story they want to hear rather than
the one the facts lead you to? It's a very blurry
line. Real estate is another one that surprised
me. I always thought you needed millions to be
a real estate developer or investor. Not anymore.
This is one of the fastest growing sectors for
crowdfunding. Platforms like Fundrise or Realty
Mobile in the U .S. allow you to invest with
as little as $100. So what are you buying? A
piece of a building? Essentially, yes. They pool
all that small -scale capital together to buy
things like apartment buildings, commercial real
estate, or even distressed mortgages. It's a
form of democratization of asset ownership. It
lowers the entry barrier to an asset class that
was previously only for the rich. And this is
a global thing. Oh, yeah. There are over 150
platforms worldwide now. China, the Middle East,
France, it's everywhere. But again, the risks
are real. Real estate is not a guaranteed win.
If the market turns, that whole crowd of small
investors takes the hit together. Let's pivot
to the human element here, the psychology of
it all. Why do we do this? I get why a creator
does it. They need money. But the notes suggest
it's more than just the cash. For creators, the
money is often secondary to the validation. Think
about it. If you put your idea on Kickstarter
and zero people back it, you've just saved yourself
two years of your life and your life savings
chasing a bad idea. You failed fast and cheap.
It's the ultimate form of market research. You're
not asking people, would you buy this? You're
asking them, will you buy this right now? Exactly.
And a successful campaign has what's called signal
value. If you raise a million dollars, that signals
to retailers, distributors, and other investors
that this is a hot product. It opens doors that
would have been closed. And it turns your customers
into advocates. Massively. If I back your project
for $50, I am now invested. I want you to succeed.
I'm going to tell my friends about it. I become
your unpaid marketing team. Okay, so that's the
creator side. But what about the backers? Why
do I give $50 for a cooler I might not see for
two years, if ever? There's a lot of psychology
at play. Part of it is a sense of patronage,
that feeling of being responsible for someone's
success, for helping bring something cool into
the world. Like the people donating to the Statue
of Liberty's pedestal. Precisely. Part of it
is social participation. There is a very strong
herding behavior that's been observed on these
platforms. As a project gets closer to its funding
goal, the rate of funding dramatically accelerates.
We like to back a winner. It's FOMO, fear of
missing out on the next big thing. It's totally
FOMO. And in equity crowdfunding, it's the lottery
ticket mentality. Everyone wants to be able to
say they put $100 into the next Apple when it
was just two guys in a garage. The odds are terrible,
but the dream is powerful. But we have to talk
about the risks for both sides. For creators,
we mentioned the failure to deliver. But there's
also IP exposure. intellectual property. This
is a huge risk for creators. To get funding,
you have to show your work. You have to post
videos, diagrams, and detailed explanations of
your idea. Once that's on the internet, it can
be copied. And it happens. It happens all the
time. There are countless stories of copycat
products appearing on sites like Alibaba before
the Kickstarter campaign is even finished. Someone
in a factory overseas sees the good idea, reverse
engineers it from the pictures, and beats the
original creator to market. And the platforms,
like Kickstarter, what's their liability? Pretty
much zero. Slava Rubin, the founder of Indiegogo,
has been quoted saying, we're not liable for
any of that stuff. If someone steals your idea,
that's your problem to solve in the legal system.
The platform is just... venue that is absolutely
terrifying for an inventor but maybe not as heavy
as the final sector we really need to discuss
medical crowdfunding this is where the topic
moves from interesting economics and cool gadgets
to a real societal crisis We've all seen the
GoFundMe campaigns, help my dad pay for his heart
surgery, help my friend cover her chemo treatments.
It has become a normalized, almost expected part
of the healthcare landscape, particularly in
the United States. But researchers who study
this view it not as a triumph of community charity,
but as a glaring symptom. of a failing healthcare
system. I saw a quote in the research from the
CEO of GoFundMe, Rob Solomon. Yes, and it's a
powerful one. He admitted, we shouldn't be the
solution to a complex set of systemic problems.
When the CEO of the fundraising platform tells
you that the system is broken, you should probably
listen. And there are really difficult ethical
traps here regarding this idea of deserving this.
This is the most uncomfortable part of the whole
topic. To get funded, you need a compelling story.
You need good photos. You need to be a good writer.
You need a wide social network to share the campaign.
So if you are photogenic and popular and can
write a heartbreaking story, you get health care.
If you are quiet or you don't have Internet savvy
or your story isn't tragic enough. You might
not get funded. It creates what researchers call
a socioeconomic gradient. People with higher
status, better education and stronger networks
consistently raise more money. So instead of
fixing health care inequality, crowdfunding can
actually perpetuate it. And the privacy cost
must be immense. You have to put your medical
records, your trauma, your worst moments on public
display for the world to see and judge just to
survive. It forces a commodification of suffering.
You have to market your pain effectively to strangers
on the Internet. It's a deeply fraught process
for patients and their families. Wow. That is
that's heavy. But it's a necessary part of this
picture. So let's try to zoom out and summarize
this whole thing. We've gone from Joseph Pulitzer
saving the Statue of Liberty with 15 cent donations
to a potential trillion dollar global industry
that includes everything from potato salad parties
to equity and scrapers to tragically life saving
surgery. It is a mechanism that has fundamentally
changed the flow of capital around the world.
It allows for incredible things, art, inventions,
games, businesses that traditional gatekeepers
would have killed in the cradle are now thriving.
It empowers the crowd in an unprecedented way.
It comes with significant baggage. You have the
outright scams, the well -intentioned failures
to deliver, the panda bear popularity contest
problem in serious fields like science and journalism.
And it acts as a systemic band -aid on a broken
health care system. It really is a double -edged
sword. It bypasses the gatekeepers, but sometimes
those gatekeepers, for all their faults, were
there for a reason, to check facts, to ensure
viability, to provide a safety net. When you
remove them, you get the raw, unfiltered power
of the crowd, for better and for worse. So here's
the final provocative thought I want to leave
you with. If we are increasingly relying on the
crowd to fund essential things, our journalism,
our science, our health care, our legal system,
are we actually moving toward a more democratic
and empowered society? Or are we just moving
toward a society? society where the best story
wins, regardless of the underlying need or the
objective merit. That is the question. Is it
true democratization or is it just a high stakes
popularity contest with a price tag? Something
to think about. Absolutely. Thanks for diving
deep with us today. Thank you.