Crowdsourcing is also to outsource work to the masses, independent of location. Amazon’s Mechanical Turk is one of the better
known brands in this area, but two more recent web-based crowdsourcing marketplaces are making the concept more popular
nowadays:oDe s k andCr owd Fl owe r.
My favorite application of the crowdsourcing concept is the process of collecting ideas from users to improve a product or
service. Check outUs er Voi ce and Get Satisfaction for ways to create more intimate and effective product feedback loops with
Crowdfunding describes how the collective pools together money to support an initiative or project. Crowdfunding has
historically been used for political campaigns, disaster relief (charitable donations), government support (taxes anyone?), and
public projects. Anti Hannula, entrepreneur from Finland, argues that the pedestal where the Statue of the Liberty is placed today
wascr owfu n d e d.
More recently, crowdfunding has seen a resurgence on the Internet on sites likeKi ck st a rt er orIn d i e GoGo, where artists,
entrepreneurs, and communities seek support for their ideas and projects from the “4F Bank”: fans, friends, family and fools.
The individual seeking monetary support typically offers something in return for a donation, such as an autographed CD,
discount on a art piece, or free access to a service.
Microfinance consists in providing of financial help to low-income families or individuals who traditionally lack access to
banking and loans (a.k.a. the “unbanked”). The concept was pioneered by Muhammad Yunus, economist and Nobel Peace Prize
recipient from Bangladesh, who devised a model to extend loans to entrepreneurs who were too poor or lacked the sufficient
credit history to qualify for traditional bank loans. He put his model to work by creating Grameen Bank: banking for the poor.
Kiva is probably the most known of a myriad of web-based microfinance institutions and facilitators. Premal Shah, president of
Kiva, describes microfinance as ” the way to empower others to lift themselves out of poverty.”
Peer-to-peer Lending or Investing
Peer-to-peer Lending is defined byWi k i pe d ia as for-profit financial transactions occurring directly between individuals or
“peers” without the intermediation of a traditional financial institution. When you look at it carefully, you will realize that this is
how lending was done centuries ago, before banks emerged and became the norm: communities borrowed and invested directly
in its members. The Internet has now made this concept available to virtually anyone, offering an opportunity for borrowers to
get better rates, and investors to earn better returns.
Zopa was the first peer-to-peer lending network, opening its Internet doors 5 years ago in the UK, and growing very rapidly in the
last couple of years. Giles Andrews, General Manager of Zopa, describes his company as “a marketplace where people can lend
and borrow money to and from each other, sidestepping banks”.