The Economic and Social Effects of Reward Based Crowdfunded Technology Projects on the Metropolitan New York Community

Abstract

Does reward based crowdfunding provide benefits to the local communities where the crowdfunding projects are based from? Drawing from qualitative Data from 14 interviews with successfully funded Kickstarter projects as well as secondary sources, this research looked to quantify the socioeconomic benefits from local based crowdfunding projects. Financial, social, networking and volunteering Data was collected as part of the interviews that were conducted via telephone, email or video conferencing. Crowdfunding is a relatively new funding platform where projects can raise money from individuals looking to invest in an idea or product in return for rewards. Crowdfunding is emerging as a viable alternative to traditional funding options such as bank loans for startups and new projects. Successfully funded Kickstarter projects with funding raised between $29,000 to $1.3M were included as part of this research. The Data shows that crowdfunding provided benefits for the local community across various socioeconomic markers. A total of 11 of 13 Data points collected as part of this research directly or indirectly support the hypothesis that the positive effects greatly outweigh any negative effects to the local community. Regardless of the amount raised during the crowdfunding campaign, an increase in jobs, volunteering and networking were noted for the local community.