This morning at TechCrunch Beijing, CEO and co-founder of OurCrowd Jonathan Medved talked to us about equity crowdfunding – a new crowdfunding model for consumer startups. Medved was named by the New York Times one of the most influential Americans who has impacted Israel.
“What happened to Oculus when it went IPO?” Medved got us thinking with a question about Oculus Rift, the smart controller that went IPO after its enormous success on Kickstarter. While Oculus “got rich,” the crowd who had funded it on Kickstarter only “got a T-shirt,” Medved poignantly pointed out.
Noticing that, Medved came up with a new model to fund consumer startups – equity crowdfunding. As its name implies, the model leverages both equity and reward crowdfunding. A dozen such platforms are already gaining traction, including Medved’s own Ourcrowd, Angel List, FundersClub, CircleUp, to name a few.
With the explosion of crowdfunding sites, basically everyone can fund a startup and any startup can source funds. This has lowered the average quality of startups on crowdfunding sites. As such Medved brought to OurCrowd VCs and angels who act as mentors for startups, and the platform always co-invests with accredited investors. Only 2% of the pitches received are selected.
At his keynote, Medved also refreshed our impression on Israel. Despite its relatively small population, the country has attracted big investments from overseas in recent years. Last year, Mobileye became the first Israeli company that went IPO.
Medved closed the keynote with a passionate remark envisioning a new kind of innovation model different from the Silicon Valley. It’s a model that tailors specifically to traditional cultures like Chinese and Jewish while still embracing innovation. He foresaw the possibility of future collaboration between the Israel and China to promote this new model. “This is why I feel closed to what’s going on in China,” said Medved.