The Power of Crowdfunding: Mining Companies Now Compete With Startups for Crowdfunding Support
Thanks to the advancements of investing, more and more upstarts are becoming confident enough to launch their new products and services to the world. By getting $5 – $10 from those who can commit, a business that had no way of getting funds from traditional means during the 90s can now get the funding they need through crowdfunding. Usually, getting monetary support from people all over the world via crowdfunding sites like Indiegogo only apply to startups that have no backing from stockholders. However, today, the old mining industry seems to be looking at crowdfunding to get the support they need for operations.
The mining industry is much different from a regular business that only needs a capital and workspace to operate. Miners need to secure a lot of permits in order to prove to the country they’re operating in that they’re following safety procedures, given the hazardous nature of the business. The environmental impact of mining and current low prices of gold are what keep miners from getting the backing they need from investors.
Crowdfunding projects are still in their early stages so there’s not much data to show whether or not they can become successful. So far, there’s only one crowdfunding project related to mining that showed tremendous promise. Planetary Resources, a company that plans to mine ores from Asteroids in the future, was able to acquire over $1.5 million in just 30 days for its space telescope project. In Canada, the KlondikeStrike Canada platform was launched in order to help people invest in mining companies that offer opportunities in the Exempt Market.
Gold is a very important commodity in the investment world. Germany, the second largest gold holder in the world next to the U.S., has a solid economy thanks to its vast reserves of the yellow metal. Gold today costs around $1,300 per ounce and if the country decides to cash in all of its reserves, it would be able to support its economy independently for many decades. Gold, in short, is one of cornerstones of a powerful nation.
Looking at crowdfunding for support may be a good step from miners. By being presented at kickstarter sites that people from all walks of life visit on a regular basis, mining firms are opening themselves to more potential markets.