Every day, I keep hearing people asking, “where do I go next for funding?” I’ve talked about how to seek funding, how to seek investors, how to get money, etc. No matter how you slice it, trying to seek funding is almost like going door to door and asking people if they have five minutes to hear an idea. Obviously, it’s more professional than that, but the feeling of apprehension is still there as you try to scale the metaphorical walls of potential investors.
With all of the innovations in social networking and business tools, how has a solution to this ordeal not been developed? As soon as I asked this question to myself, a colleague showed me a website called, www.Sprowtt.com and then I considered wondering aloud if I could have a free Mercedes.
To put it simply, by using Sprowtt, anyone can participate in the funding of companies. Potential investors are able to log on to the site and create a profile with detailed financial and bank account information. Then they are given a list of companies they can invest in based on their financial capabilities. The start-ups have their own information posted such as informational presentation videos, the amount of money the start-up has already raised, and their products and detailed business plans, on which the investors can share their comments.
So what happens if the investor likes the company? Once they’re interested they can sign the stock subscription agreement and then enter the number of shares they wish to purchase. At this point, the funds are held in escrow until the offering is complete (which happens when the minimum amount for an offering is accumulated). Sprowtt then helps to transfer the funds from an investor’s account to the start-up.
The entire process is done in a very comfortable and familiar format that is like almost any social networking set-up that we as a Web 2.0 familiar community are used to. Personally, I think that if this site can get its proper ducks in a row that this will make the investor process very accessible to the sudden influx of start-ups that are currently out there and ready to make the leap to capital raising.
