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Comment by mbesto | Hacker News Reader

How does crowdfunding successfully work in the UK, but not in the US? Having done startups in both environments, structurally, I don't see much of a difference.

UK crowdfunding websites for reference:

https://www.seedrs.com/

http://www.crowdcube.com/

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I'm interested in how many of those investors achieved >1x ROI. Are there any publicly available stats?

AFAIK no. I know you're not refuting this, but my general point is that in the UK this system does exist and hasn't created the supposed chaos in the UK that the US financial authority believes will happen in the US.

From memory signing up for Crowdcube last year (a colleague asked me to review a business he's been referred to), I had to 'tick a box' declaring I was a sophisticated investor (not the right legal term - I think I'm inserting the Australian equivalent into my memory). I presume a slightly more thorough approval process would be involved if I made an investment.

So it's crowdfunding, but not in the "everybody can play" model the article discusses.

You're right, but the sophisticated investor requirements are very loose.

http://www.seedrs.com/faq/items/65_what_are_the_eligibility_...

http://www.legislation.gov.uk/uksi/2005/1529/schedule/5/made

Interesting to see that this does not include a similar declaration for someone with expertise in the field that the investment opportunity is in. Still I guess it could be argued that even if the business is successful you could be hard done by if you don't understand the financial instruments involved as well as you should.

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