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11/15/2013 McKinsey & Co - Why crowdfunding appeals to the Middle East
12/30/2013 KQED Radio - Richard Swart - A How-To Guide to Crowdfunding 12/20/2013 Gulf Times - Silatech Hosts Seminar...

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What I learned at 4am going to the Miami Airport

Sometimes it takes me a while to really hear something and process it.  This was the third time and it finally sunk in.  A different side of the Uber/Lyft phenomena:  The Driver.  Woodie and I were headed to the Miami airport, for yet another flight, and we were chatting with the driver.  About half of the time when I'm in an Uber/Lyft the driver seems interested in talking and if so, I usually ask a few questions about how long they've been driving, how do they like it, what were they doing before, etc.  

When we asked the driver our first question about how long he had been driving for Uber/Lyft, he responded with "Uber has changed my life...Lyft has too."  I had heard 2 other drivers say this in the past, but not with the same emphasis has he did.  We asked him to tell us more.  Essentially it was this:  He came to the U.S. 20 years ago and and worked a steady series of security jobs making barely above minimum wage.  A few months ago he was working at a quick service restaurant and security at the same time.  A few months ago, he started driving for Uber/Lyft, and he had just quit his other two jobs the day before he picked us up.  He said again "It has changed my life" and talked about how much he enjoyed driving, meeting the nice people who used the service and that he was now able to start saving some money to start his own business one day.  The pride and joy in his voice was palpable and impossible to forget.  

I look forward to a time when thousands of business owners can talk about about how crowdfunding changed their lives, or the life of someone they knows...the ability to work hard, get funding from your community, and start a business.  Woodie and I are passionate about creating new ways for businesses and entrepreneurs to start businesses.  That is one of the reasons that by the end of this year, we will have flown a combined total of over 1,100,000 miles over the last 3 years to create this opportunity for people in countries around the world.   We will continue to do so, because we must if we are going to create enough jobs and business opportunities to stabilize economies/regions and engage populations in driving their own economic destiny.  

Asia Turns Up the Volume on Crowdfunding

Recently I was in Singapore to speak at the Crowdfunding Asia 2014 event and lead a panel discussion. The event was very well organized and had many interesting and engaging speakers including the Minister of State from Cambodia, the Secretary General of the Stock Exchange of Thailand, Doug Ellenoff of Ellenoff Grossman and Schoel, and Paul Neiderer of ASSOB.  The roughly 200 attendees came primarily from Southeast Asia but also included crowdfunding industry participants from China, Taiwan, Japan and Korea. Screen Shot 2014-08-25 at 2.54.06 PM

If you have not been to Singapore, I highly recommend it for a number of reasons (business environment, support of entrepreneurship, etc.), but for me #1 is the food.  Food in Singapore has influences from the entire region and they come together (and/or remain separate) in lots of amazing ways.  Even if you just have 48 hours, you can enjoy yourself on a stopover. (ok...ending the unpaid Chamber of Commerce message).

A few takeaways to share from the event and the meetings and conversations during the event.  

  • Several countries in Southeast Asia are moving quickly to finalize their regulation on equity (and in some cases equity and debt) crowdfunding.  We are working directly with 2 of these countries and will be able to discuss more on this in the coming weeks/months.  
  • There was a significant focus of the conference on Women in Crowdfunding and Women Investing in Women.  This is a huge issue globally and is one of the reasons why we published a paper on the value of crowdfinance for women/minority owned businesses was referenced by 6 different speakers at the event.
  • CCA has been invited on our 12th mission for the US State Department to Hong Kong September 15-18.  These missions are always fascinating as a way to do a quick and deep dive into an entrepreneurial and funding ecosystem in a country.  We'll provide a a heads up on the schedule when it is available, and a summary following the event.  
  • Crowdfunding as a possibility in Cambodia?  Yes, in the future ... possibly near future.  The team from the Cambodian government that attended the event was laser-focused on what they can do to develop their economy and create jobs.  With smart phones and tablets now for sale at $100, and soon less than that, greater and greater numbers of citizens have social Web connectivity.  The generation born after 1980 is taking power in the country and they are moving quickly to modernize and build entrepreneurial capacity and skills.  While challenges abound, I do believe this is a country to watch because it has interesting potential.  
  • In countries in Southeast Asia that have majority or minority Muslim populations, it will be interesting to see the extent to which Islamic Finance compliant platforms emerge.  
  • Crowdonomic continues to charge ahead in Singapore and I look forward to talking with their CEO Leo Shimada in mid-September when I'm back in Kuala Lumpur, Bangkok and Singapore.
  • Taiwan has the largest rewards-based platform in Asia - Flying V.  I had the chance to sit down with its CEO and Founder Tim Cheng and learn the great things he and his team are working on and I'm looking forward to lending a hand to their efforts early next year.  
  • I also had the chance to sit down with the Founder and CEO of e27, the leading tech blog in the region.  Their site is a great way to learn a bit about this fast growing tech scene and if you are in Bangkok in mid-September, check out his Eschelon will be great.


2nd Annual UC Berkeley Crowdfunding Symposium - LIMITED TICKETS

The UC Berkeley 2nd annual academic symposium on crowdfunding will be held September 11th & 12th. Like the first, this gathering will bring together academics, practitioners, and policy makers. This symposium will take a global look at the developing phenomena of social finance for SMEs and Innovation - whether strictly “crowdfunding” or more broadly the application of social finance mechanisms including Peer-to-Peer lending, Peer-to-Business lending, and all other forms of crowdfunding and crowdfund investing. Since the 2013 conference, the number of platforms has more than doubled, and despite significant delays in enacting rules to allow equity crowdfunding in the United States, many nations have adopted laws and rules to allow crowdfunding.Screen Shot 2014-08-05 at 12.29.20 PM

There has also been significant interest from NGOs, Foundations, Philanthropic groups, universities, and other groups in the application of crowdfunding mechanisms to solve both complex global challenges as well as fund hyper-local programs. The conference will begin with lunch on Thursday, September 11th and includes dinner that evening. It concludes in the afternoon of September 12th. Consistent with the model from last year, distinguished scholars will present their views during moderated panels, as well as top thought leaders internationally. This format allows for the exchange of best practices, questions and research insights from leaders in the international community.

Tickets are $99 for academics and $199 for nonacademics.  Tickets are reserved and must be applied for.  In order to apply, please contact Richard Swart at This email address is being protected from spambots. You need JavaScript enabled to view it.

The New Broker Dealer - More Focused Brain Work and Less Manual Labor

Broker dealers of the distant past (circa 2010) who worked in the private capital markets never thought their jobs would change.  They thought only other industries could be disrupted by the Internet and technology.  They assumed investment banking was secure because securities regulations written in 1933 and 1934 were fixed in place.  It was generally assumed that public solicitation of private stocks would never be allowed.  Screen Shot 2014-07-24 at 9.37.23 AM

Fast forward to 2014 – Parts of the JOBS Act are in full effect, general solicitation has been lifted, and the average American is about to be allowed to partake in the private capital markets.  Everything is changing and some are still in denial.  Remember what happened to most travel agencies in the 1990's?  

Unlike travel agencies that could fully be displaced by websites, broker dealers play a critical role in the capital markets. However the time has come for them to make some radical shifts in how they approach their businesses.  Here are three things every broker dealer needs to be working on now to avoid the same fate as the travel agents who said "why would anyone buy an airplane ticket himself? It’s too difficult!"

  • Much time and resources will be spent on background and diligence checks for the many new issuers entering the market.  Looks at ways to outsource this.  Leverage powerful and scalable due diligence technologies that go way beyond just the basic "bad actor" checks. This will allow BDs to focus their time and resources on what they do best: curating deals, matching them to investors, and raising serious cash.Screen Shot 2014-07-24 at 9.36.46 AM
  • Look at every step in the transaction process to see how new technology solutions can replace skilled professionals needing to shuffle paper or run process.  In doing so, BDs can increase transactions and decrease the number of hands that have to touch everything.  Nothing replaces the judgment of seasoned professionals in making the decision to work with a client or not.  But seasoned professionals shouldn’t conduct their work like it is 1985.
  • Use new sourcing tools for high quality deal flow.  Crowd finance platforms are coming online, entrepreneurs are listing their offerings with them, and deals are getting funded. Use these platforms to quickly and easily find companies that have proven they have a market, a customer, can raise money, and can execute.  Most likely these companies will need follow on capital.  Most likely the crowd won’t have deep enough pockets for follow on rounds.  This is where BDs can acquire deal flow and raise money for these firms faster.  Consider ways to partner with crowd finance platforms for early access to these deals.  More deals means more money in the BD’s pockets.  


Broker/Dealers and securities professionals in the US and abroad need to heed this advice.  Those who focus on this intensely over the next 12-18 months are the ones that will thrive in the future.  Those who do not, may be wondering what happened to their businesses 2 years from now. 

3 Ways Crowdfunding Can Foster Open Source Pharma








Nestled among the beautiful scenery of Lake Como, Italy with pristine lake and soaring evergreen mountains a group of 23 hyper connected individuals from biotech, NGOs, non-profits and global funds gathered to answer the question "How can we use the 'evolving collaborative economy' to treat diseases in very effective ways without destroying incentives?"

It was apparent to the attendees that process for drug discovery and development is broken.  These problems include:

  1. Scientists who are afraid of losing their intellectual properties (consisting of molecules, compounds and libraries) are not sharing them, and this is inhibiting innovation.
  2. A lack of collaboration among scientists means repeating costly errors and duplicating unnecessary research.  This ends up increasing the length of drug discovery, only leads to incremental improvements, and furthers the "drug development is a costly initiative" theory.  And
  3. The lack of funding is falling short of what is needed to move from drugs from Phase II to Phase III clinical trials -- the point at which drugs go from 'proof of concept' to 'human consumption.'


These individuals aren't focused on the problems but the solutions. "Open Source Pharma" (#OpenSourcePharma) is the idea where the process of drug discovery is brought online, everyone collaborates, time and costs are reduced, solutions to developing economy and small market ailments are addressed, and the world wins.

Luckily the biotech industry understands the power of collaboration because crowdsourcing, where people are invited online to collaborate in solving a curated problem, is rapidly evolving as a tool among scientist to foster innovation.  Data points to the fact that crowdsourcing has proven to lead to better solutions faster. However there are still many problems to be resolved.  These include the time to take drugs to market and funding.

Crowdfunding is sweeping the globe as a solution to the funding void in many industries.  The funding void is the most difficult money to raise between one's own personal cash and that of venture investors who tend back projects that have a greater likelihood of being viable with their investment.  Crowdfunding is the ancient practice of 'friends and family' financing brought to the Internet age where websites list fund raising campaigns and individuals use their social networks to solicit contributions. Crowdfunding saw its emergence around 2009 with artists using it to raise funds for their concerts or projects.  Today companies are using crowdfunding to pre-sell products, raise equity funds or borrow money from the crowd on more favorable terms than the banks.  In 5 short years, it has  grown into a multi billion dollar industry.n 1425 colore

Crowdfunding isn't a panacea. Taking into account all forms of crowdfunding, less than 35% of initiatives are successful with their fundraising.  However, it does increase the opportunity for individuals' to access capital where the traditional financiers have either shown no interest in funding or have stepped out of the equation.  Depending on the type of crowdfunding it requires that certain technology, social, cultural, regulatory pieces are in place.  Globally an entire industry has sprouted to support crowdfunding.

Here are 3 ways the nascent Open Source Pharma community could use crowdfunding to further its goals:

  1. Host a crowdfunding campaign with the goal of launching the Open Source Pharma initiative.  Set a realistic goal to create a minimum viable organization that leverages a community of engaged supporters but understands the need for a central organization to represent them as the voice of the Open Source Pharma network.
  2. Figure out if the organization is best suited to buy, build or white label its own crowdfunding platform.  It is critically important to understand that crowdfunding platforms are complicated websites with major technical needs.  The Open Source Pharma initiative needs to support scientists at all stages in development.  They should promote innovate crowdfunding terms that include donation at the earliest/riskiest stages to engage both communities of affected people and communities of scientists.  At later stages of development these platforms should leverage equity and revenue based financing to further incentivize people should be promoted.
  3. Seek matching funds or create an X-Prize type of reward to further encourage collaboration and move development through the pipeline.  Reward people along the way and promote multiple smaller campaigns rather than one large one.  This will continually engage backers along the development lifecycle.


These are a few of the ways that will get the Open Source Pharma movement up, running, promoting crowdfunding, and fostering innovation.  There are many more.  Crowdfunding works because it engages the community where they have interest and provides not only money but a voice to the initiative.  It is 'open source financing' and can be a huge benefit to Open Source Pharma initiative.  It needs to be carefully curated though.