profounder

[emmetb]

Profounder is a new service which claims to make it easy for companies and private (non-accredited) investors to raise money and to invest respectively.
http://www.profounder.com/about
The founder of profounder will be speaking at TEDglobal2010.

[Rezwan]

This is a great idea. I think that crowdsourcing is a great way to go for fusion.

We contemplated this in the beginning but didn’t get many donations. And we couldn’t (can’t, legally) offer people a return on investment if they aren’t accredited investors.

So we didn’t get much that way and put the idea on hold.

I’m not sure how profounder bypasses that accredited investor rule. It’s SEC law. I looked at the site and they don’t mention this or how they are working around it, although they do say

So, why can’t anyone just invest a few hundred dollars in a small business they love? We’ve heard hundreds of stories from entrepreneurs and small business owners who have tried gathering investments (real investments, not just donations) from friends, family, and other members of their community, but have struggled along the way. Unfortunately, the process is unnecessarily confusing, costly, and complicated.

ProFounder will change this. We’re making it easy for your community to contribute financially to your business, so they’re literally invested in your success.

They “will” change this. Looks like they are trying to mount the argument that some SEC rules should be changed.

This is one of the items of the Focus Fusion General Plan (about to be unveiled). We need to network with people like profounder and others who are interested in microfinance, crowdsourcing and innovation, to get the SEC to make exceptions for certain types of investment opportunities.

Something to open the door to anyone and everyone who wants to invest in fusion, and not draw the line at people with over 5 million$.

Most accredited investors won’t deal with cutting edge fusion research because it’s too risky. But anyone in the world who is willing to lose a bit of money against the possible gain of a new energy source and possible financial return to boot – that is cool.

[Rezwan]

Here’s a post where we talk about the accredited investor issue and why LPP and FFS are two separate organizations.

I would really like to join forces with Profounder to overcome this SEC issue.

[Breakable]

Give me, give me, give me an opportunity to invest into fusion energy!!!
I would put a thousand bucks on FF, Poly-well, FRC and any other investment-accepting perspective approach and wait-see which one succeeds.
It would be like buying MSFT in the 80’ties.

[Rezwan]

Breakable wrote: Give me, give me, give me an opportunity to invest into fusion energy!!!
I would put a thousand bucks on FF, Poly-well, FRC and any other investment-accepting perspective approach and wait-see which one succeeds.
It would be like buying MSFT in the 80’ties.

Please elaborate. We can use your story as a persona around which to explain the dilemma facing the unaccredited investor.

[Breakable]

I don’t see much to elaborate about, but here it is:
There is just no investment opportunity available for fusion if you don’t have a million bucks. The only alternative I see is to short some sector or to invest in sectors that could benefit – but it would be less profitable and no way to directly influence the outcome.
If there was a way to gather all the funds together from all the small investors and put them in a diversified portfolio of stocks (mutual index), that invests in all perspective fusion approaches depending on which ones are the most perspective that would probably be the dream. It could probably help (not sure about the legal side) to make IPO’s for the small companies that engage in fusion research and cant afford it themselves, for some share purchasing deal’s. Alternatively in case investors are plenty the fund could just throw the money at anything that seems remotely possible and see if something sticks around. I expect the profit to be so huge in the end that 100/1 ratio of successful investment will be pocket change.

[vansig]

how does one become an accredited investor? what’s the process?

[Aeronaut]

vansig wrote: how does one become an accredited investor? what’s the process?

Here’s an outline of the requirements: http://www.sec.gov/answers/accred.htm

It looks to me like you get a net worth of $1M, or 2 yrs’ income of >$200k with reasonable expectations of continuing to make at least that much.

In order to do that you probably own a business, so the business options are probably the most realistic for today. These rules were drawn up in 1933 to keep the rif-raff out.

[vansig]

so profounder is probably a business development company or small business investment company, and that gets them their accredited status. i imagine, then, that they must obey a set of regulations that protects their account holders

[Aeronaut]

vansig wrote: so profounder is probably a business development company or small business investment company, and that gets them their accredited status. i imagine, then, that they must obey a set of regulations that protects their account holders

Probably. Some kind of high risk portfolio where the individual investors are clearly warned up front that the science may or may not prove out, but if it does, the upside could be a market beater.

I’m not entirely sure how all of this works, due to hedge funds betting heavily on junk bonds, and angel investors bankrolling companies with nothing more than an idea.

[vansig]

the terms of use reveals a bit more of how this works,
https://www.profounder.com/legal/terms_of_use

“the Website […] allows Issuers to raise funds from Investors through private, password-protected fundraising websites that Issuers create. Investors can invest in the the offerings provided by Issuers. Offerings are considered high-risk and by participating in the Services or otherwise using this Website, you hereby acknowledge and agree that ProFounder makes no representation, warranty, covenant or guarantee that any capital you invested in offerings Issuers may post on the site will be returned in whole or in part, or exceeded at any level.”

i say it’s superior to online gambling, at least.

and they’re on linkedin:

http://www.linkedin.com/companies/profounder

Current Employees (3 total)
Dana Mauriello Co-Founder, President
Ryan Garver CTO
Jessica Jackley Cofounder, CEO

[Author]

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