Non-public geographic capital markets are notoriously inefficient.
Where businesses are located affects their access to capital, growth rate and valuation.
Valuations in capital rich geographic areas like California and Boston are often two or more times greater than for the same business in the southeast U. S.
Investors are eager to locate under-valued businesses.
Crowdfunding can be a powerful Economic Development tool, because Crowdfunding can direct massive amounts of capital from capital rich geographic areas to capital deficient geographic areas to allow investors to find the best bargains and local business to raise the capital they need to grow.
Both investors and businesses benefit, if geographic capital markets become more efficient with businesses in each location having comparable access and valuations.
Likewise, because Crowdfunding aggregates many small investments into a bigger investment, it is also a tool for local communities to invest their resources into local businesses even if thy do not have institutional investors.
But Crowdfunding doesn’t perform economic development miracles by itself. Like any tool, you have to know how to use it top achieve the bet results.
We at Gateway Capital have an economic development plan that provides states and local communities with a plan how to build local Eco Systems required to use Crowdfunding to develop state and local economies.
Does your state and community have what it takes to wield the Crowdfunding Economic development tool?
How do you get the missing pieces of the puzzle?
Check out the big picture and then call us to discuss how we can help you create a workable Crowdfunding Economic Development plan.