Anticipating Lightweight and Cheap Batteries+discussion

Crowd funding, from a shareholder perspective, will become increasingly an issue of governance. If the purpose is to broaden the sources of traditional "angel funding", then the participants really need to know what their stake will be - immediately and in the future. It will not take too many burns or claims of burns to dry up crowd funding for all projects, and it is good to commit in advance what their share is expected to be. Indeed, this will demand something beyond even the traditional prospectus. As I see it these are the salient elements.

1) Plain English. Yes, I know there may be a smattering of legalese in there; but most people aren't up on legalese, and things should be spelled out very clearly so that someone with a high school education will understand it thoroughly.

2) Initial Principal(s) share, both current and as subject to dilution. It is important for crowdfunders to understand where both control and profit sharing are and will be. There are advantages in the initial principal(s) maintaining control of operations so as to ensure the capability to proceed as represented in the technical and marketing thrust It is also advisable to keep any prospect of self-dealing out. Too many people have built up enterprises and then treated them like a personal checking account. Initial Principal(s)' earnings, in a crowdfunding enterprise should be anchored in earnings, not salary and perks. These should have a fixed maximum from the get-go.

3) Shareholder dilution. As enterprises grow, they often need to access additional funding. Ideally, this comes from loans, but the availability and rates may be prohibitive. Dilution, however, should be with the consent of the crowdfunders - who get priority opportunity for subsequent rounds of capitalization.

4) There should be a wall of separation between employees, principals and manager in regard to additional services rendered. Employees should be hired to accomplish only things directly related to the whole of the enterprise - and this excludes serving as go-fers for principals and managers. If their lives are too complicated to manage without additional help, they should bear the cost of those complications.

There are probably weaknesses here, but this looks to be the best place to start.

In a way, the discussion of the architecture of the 'crowdfunding' system is distinct from the project it might fund, and I'm not sure I want to hold in in this place. Each point you make deserves and has a response at the currency design level. I wouldn't use the term wall, but more likely something like circles of engagement which would be defined within a system of currency that tracks a wide range of flows that serve to quantify and qualify relationships between participants, production, consumption, skills, experience and any other flow or flow signal worth tracking.

I'm starting to write in more depth on that in Flow Systems, let's continue this part of the discussion there.