November 3, 2012
Melinda Wittstock will be a panelist at DCWEEK for “Crowdfunding: Exciting New Hope for Entrepreneurs?” She is the founder of NewsiT, a crowdsourced approach to news that lets readers create and contribute to content. DCWEEK is a week-long festival co-produced by Tech Cocktail and iStrategyLabs. Get your tickets here.
Tech Cocktail: How does NewsiT use the power of the crowd?
Melinda Wittstock: NewsiT is all about your crowd and your story. People come together around interests they share and people they trust, to create and collaborate on stories relevant to them. Our app and process is all about crowdsourcing. We think the more eyes and ears on a story, the better the story. Story threads evolve and update over time as people add text posts, video, and photos. They can also ask their friends to help by assigning specific tasks. The community rates and ranks the content, and the cool thing our algorithms do is help ensure each individual contribution is both relevant and accurate, in real-time.
Tech Cocktail: Best-case scenario – what would be the best outcome of the new crowdfunding regulations?
Wittstock: NewsiT would get millions of dollars in funding! But seriously, any entrepreneur should be excited about the potential for all entrepreneurs at an early stage. Capital is scarce for pre-revenue companies – and the best outcome would be an engaged society working collaboratively to filter and validate the best ideas and innovations to build the businesses of the future, from the bottom up. These are the businesses that create jobs and bolster our economy.
Tech Cocktail: Worst-case scenario – what could be the worst outcome of the new crowdfunding regulations?
Wittstock: Worst-case scenarios are the very thing the SEC is no doubt gaming right now as it writes its rules: Small investors get ripped off on scams, disputes over everything from dilution to intellectual property ending up in the courts, liability issues, and the like. From the entrepreneur’s perspective, it would be a challenge if the bar on disclosure is set so high that a business risks giving competitors its “secret sauce” or special know-how. It would also be a challenge if angels and VCs regarded crowdfunded businesses as too cumbersome to get involved in – or diluted the early investors so much that it ultimately deterred early-stage crowd-investors.
Tech Cocktail: Where does your opinion fall?
Wittstock: So much of this is speculation until the SEC makes a final ruling. As an entrepreneur with a business based on crowdsourcing news and information, I am a big believer in the democratizing potential of crowdfunding. If it’s implemented right, it will be a game changer.
Tech Cocktail: What makes the DC startup scene unique?
Wittstock: It’s great to see growing energy and momentum in the DC startup scene. There are a lot of super smart people in town with the deep domain expertise to disrupt major verticals – from health and education through to government and beyond. There are a lot of great innovators in the Big Data space and, increasingly, around social enterprise and mobile. But it’s still a tough town to raise money in if you have a “swing for the fences” transformational play: Silicon Valley tends to risk more and risk bigger and risk earlier. So entrepreneurs like me are having more success fundraising in both Silicon Valley and New York’s Silicon Alley. Hope that’s changing!
Tech Cocktail: What are you most looking forward to at DCWEEK?
Wittstock: Meeting great entrepreneurs and tech talent, and learning lots! It’s great to compare notes, get the word out, and if at all possible, find ways to finesse some great revenue-generating partnerships and collaborations!
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