Newspaper article The Topeka Capital-Journal

A Little Help from a Lot of Friends Can Raise Funds

Newspaper article The Topeka Capital-Journal

A Little Help from a Lot of Friends Can Raise Funds

Article excerpt

Topeka native Taryn Jacob and a few of her friends wanted to create environmentally friendly, compact water bottles, but the group had no capital to get the project off the ground.

In search of a loan, she created a business plan, like her father had when he started a small business and presented to a local bank, she said.

"They legitimately laughed at us," she said.

Not to be deterred, the group turned to Kickstarter, one of the largest crowdfunding websites, and launched a campaign seeking between $20,000 to $25,000. About $35,000 was raised through the site and Jacob started Nada Bottle, a company that provides collapsible BPA-free plastic bottles encased in nylon. A portion of the company's profits support clean water efforts around the world.

"We really wouldn't be where we are without crowdfunding," Jacob said.

Crowdfunding platforms such as Kickstarter, Indiegogo and GoFundMe have become "extraordinarily popular" with startups and small businesses looking to raise capital from strangers rather than loans, said Wallace Meyer Jr., director of entrepreneurship programs at the University of Kansas School of Business.

According to crowdexpert.com, a website devoted tracking trends in the crowdfunding industry, global crowdfunding skyrocketed from $12.7 billion in 2012 to more than $34 billion in 2015.

Small businesses have faced limited opportunities to raise capital.

"If you think about it, prior to crowdfunding, your choices were really yourself, your friends and your family," he said. "You certainly can't get a bank loan because there's no collateral, and bank loans don't tolerate that degree of risk associated with a startup."

Topeka artist Jancy Pettit turned to Indiegogo when she wanted to fund an abstract shapes coloring book. Pettit wanted to use heavy paper that wouldn't tear under the pressure of a crayon or colored pencil, so she couldn't print the books on demand and needed a little extra cash. She set a goal of $5,000 and raised a little less than that. …

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