Posted by ThePlus - 11.01.2012Entrepreneurs, small business owners, artists, designers, developers and anyone looking to fund an innovative idea now have a new source of capital – crowdfunding. This new phenomenon is steadily gaining momentum across the nation and Northeast Ohio is no exception.Much like the name suggests, crowdfunding involves pooling the resources from any number of interested "investors" in support of a particular project, cause, initiative, etc. In recent years, crowdfunding has often been used by artists and musicians who employ services like Kickstarter. Progressively, though, the idea of crowdfunding has expanded into new arenas and is being used by small business owners and entrepreneurs. Thanks to the power of the World Wide Web, today's innovators now have an untapped source of capital, which is proving quite lucrative in many cases. While the funds raised through crowdfunding campaigns don't aim to compete with high profile investors and venture capitalists, they are helping fill a void.For those skeptical about the usefulness of crowdfunding, take the innovators at [Fuse] Chicken, a company based out of Akron who successfully raised more than $200,000 for their "Une Bobine" device. Their product, which serves as a flexible stand, sync and charging cable for the iPhone and Android, attracted the interest of more than 4,500 financial backers. "Une Bobine," French for "a coil," provides a unique way to hold one's iPhone or Android device (see image below). The Une Bobine makers solicited funds through Kickstarter in order to manufacture their flexible cable affordably and in larger quantities. With an original goal of $90,000, the Akron team surpassed their expectations by more than 122 percent!While crowdfunding can be a great way to raise capital, as was the case with [Fuse] Chicken, it can also be used to generate awareness and foster long-term business opportunities. This past spring, three undergraduate design students at the Cleveland Institute of Art set out to fund their unique, flexible desk organizer, Nesl. The bright, playful organizer employs a series of suction cups, making it easy to move and position in any workspace. Surpassing their goal of $30,000, Nesl's makers garnered the support of nearly 850 backers. While the financial boost will go a long way in helping to manufacture the innovative product, the crowdfunding campaign proved highly effective in attracting widespread interest. In fact, thanks to the success of the Kickstater campaign, Nesl's creators have begun working with Brookstone in order to sell their product in Brookstone stores across the nation.Even though crowdfunding is a relatively new phenomenon, it's already having a big impact. In fact, as reported in this story from Fresh Water Cleveland, "Nearly $1.5 billion was raised for over a million different campaigns last year by 452 sites, according to industry group Crowdsourcing.org." Crowdfunding has become so popular that local economic development organizations like JumpStart have started developing programs to teach area entrepreneurs about how to best leverage this new revenue source. This past October, JumpStart hosted an evening event strictly devoted to crowdfunding titled "Crowdfunding 101." The crash course was led by Bob Cohen of the Braintree Business Development Center in Mansfield and provided an overview of the crowdfunding landscape for those interested in learning more about the popular trend.While entrepreneurs are still testing the crowdfunding waters, it's likely a trend we will continue to see more of in the years ahead. As Northeast Ohio grows its entrepreneurial community, crowdfunding represents a unique avenue for emerging startups to gain exposure and needed capital. Like we saw with [Fuse] Chicken in Akron and the creators of Nesl in Cleveland, crowdfunding can open many doors and provide the necessary resources to bring businesses new levels of success. http://www.theplus.us/en/Know/2012/November/Crowdfunding.aspx