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NEW BOOK AVAILABLE SOON

PRE-REGISTER NOW AT

NewRoutesToFunding.com

PRESENTED BY BARRY E JAMES of

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Crowdonomics

The Background to the Book

“New Route to Funding” seeks to advance the understanding of crowdfunding to enable

more people to harness its power for business, new products, start-ups and growth.

Based on big data insights from 500,000 crowdfunds combined with the latest research.

Crowdonomics Plus a fresh, root and branch, analysis of where we are and where we’re headed

as a world economy and society in the process of being re-made by technology, and the

unstoppable global forces this has unleashed.

The Crowdonomics MINT The book includes the new Crowdonomics MINT: A new tool for

understanding crowdfunding's dynamic and how to harness and use it, alone and in

combinations that blend new with old.

Its emphasis is on using all the available evidence to understand and explain how these new

mechanisms actually work, to enable them to be harnessed and used more widely and more

effectively. To support and accelerate ventures to 'investable' and sustainable.

Crowdonomics – A New Lens

Crowdonomics, born of an ongoing analysis of the forces that drive the 21st century world

economy, provides a new framework – a new lens - which discards disproven assumptions and

replaces them with observable evidence to provide a new understanding better able to model,

plan and predict success.

While we believe that these are profound and powerful developments you do not, of course,

need to subscribe to the vision or even agree with our macro-economic analysis, to benefit from

the book.

We hope however that this background will help to shed new light on the ‘why’ as well as ‘how’

– and help to challenge established thinking patterns and deepen understanding in a world

where industries are increasingly ‘disrupted’ as beneath them the landscape is reshaped by

these tectonic forces, and change is ‘the new normal’.

Barry E James

August 2016

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Crowdonomics

A Fresh Analysis

Introduction

It’s evident that technology, the new environment in which we now live, changes the

dynamics of business, society and work at a very deep level. Challenging not just businesses

and institutions but the very foundations on which civilization and society is built,

worldwide.

Fintech is transforming finance and funding, and that story is far from over - but what next?

Is this all skin-deep, rearranging the deck-chairs as the Titanic steams on into yet deeper

waters?

It’s already evident that the nature of jobs, work and employment - the very concepts as

we’ve known them - are under pressure. Change is happening unasked. Is this bad news, or

good - or could it be either or both?

“You need to understand the macro trends happening globally and how they are

going to impact you personally” Scott Picken, Wealth Migrate

The foundations beneath traditional economic analyses are shaking as these tectonic forces

bite. As we begin to adapt to this new environment with new opportunities, new threats

and very different dynamics.

We need to examine these foundation - penetrating deeper with a deeper analysis than

since the foundation of economics over 200 years ago. We can no longer take for granted its

tenets and assumptions let alone the guidance and conclusions we’ve grown used to it

providing.

Crowdonomics attempts a new analysis based on the facts as we now know them - replacing

assumptions with evidence from a world undreamed of when those foundations were laid.

Recent history, especially on the scale of the last 200 - 300 years, has been a tale – despite

some notable exceptions and regressions - of increasing and progressive emancipation -

from slavery, voting, for men and then later women. Much of which remains unfinished

business. Equal employment rights, equal recognition and equal pay spring to mind.

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But perhaps we are, with the right support and encouragement, as a race, ripe for a little

more maturity. A fuller emancipation.

The Road From Serfdom

Once the many worked for the few, did as they were told, with little or no rights and, for

slaves no pay at all.

Now the many still work for the few, albeit in better conditions, doing, more or less, as

we’re told, for pay – often increasingly inadequate pay, as the few take a bigger share.

As crowdfunding provides a route to a new model – a capitalism that doesn’t rely on capital,

and a new world in which ordinary people may freely choose to work for, and with, each

other could we be entering a new world in which we may freely choose to work for, and

with, each other? Working together in a new way - working for, and with, the crowd?

Crowdonomics is an exploration of where we, the world of work, society and civilization are

– and might go next, “if we want it”.

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Crowdonomics

A Fresh Analysis

Livelihoods: Working For the Crowd - Working With the Crowd

A new choice for us all - and the future of work for many of the many?

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How the Opening of the Economy to 'The Many' is Transforming Work, Employment and

The Entrepreneur's Journey

On Catch-up in a Fast Changing World

We're all on catch-up. The nature of jobs, work and the economy continues to change - so

much so some of the concepts that formed the bedrock of modern civilisation and society

are changing - perhaps beyond recognition. The tectonic forces are almost palpable. The

tools we've used to understand all this - including to guide our governments are failing.

The Abolition of Slavery

Economics was born in a world in which literacy and education were for the wealthy-few,

not the many. Which had yet to abolish slavery and which was unashamedly elitist to its

core. Cromwell's 'new model army', whose chief innovation was that officers were chosen,

at least in part on merit, rather than social station, had only recently been disbanded. So a

world, formed, ruled and directed by 'noblemen'. The vote a thing undreamed of for women

- and a distant one for almost all men.

It’s increasingly evident it was founded on assumptions that were entirely wrong, or at least

no longer hold in a world transformed, in turn, by the industrial, information, digital and

network revolutions.

'Economic science' is an art-form - sometimes played as a sport called 'financial

engineering'* - that deploys scientific tools to support models and views based on this

worldview. It remains, nonetheless, formative for society and the, largely unquestioned,

lens and tool of choice for governments.

*” I found myself sitting next to one of the inventors of financial engineering who I did not know, but I knew who he was and that he had

won a Nobel Prize, and I nudged him and asked what all the financial engineering does for the economy and what it does for productivity.

Much to my surprise he leaned over and whispered in my ear that it does nothing. I asked him what it did do and he said that it moves

around the rents in the financial system and besides that it was a lot of intellectual fun."

http://nypost.com/2009/12/13/the-only-thing-useful-banks-have-invented-in-20-years-is-the-atm/

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Jobs & Employment Fragmenting

Since slavery was abolished 'full employment' (more recently, in effect, an 'acceptable' level

of unemployment) has been one of the chief goals of governments globally. It has been

assumed, and the assumption remains largely unchallenged, that the many will (more or

less willingly) work for the few. But the paradigm is breaking down, the concept of the 'job' -

and, like it or not, employment as we've known it, are - like polar ice mountains in the face

of global-warming - fragmenting before our eyes.

Uber, the gig economy and the sharing economy foreshadow 'the shape of things to come'.

Work mediated by online platforms, 'employing' people, and their resources, more flexibly,

more efficiently, more powerfully. It's a major mistake to think of them as niche industries

or edge-cases. Such are the sunrise industries.

Uber, Employment and 'the shape of things to come'

Like it or loathe it Uber, and their peers, are near the forefront of not just technology such

as driverless cars, but are also forging the future of work and what we have called

'employment' - a concept built on an assumption of hierarchy - and something termed in law

a "master-servant relationship", reflecting this.

While employment is a concept which has already been stretched beyond its capability self-

employment is no such thing, but a burgeoning rag bag for everything that won't fit the rigid

mould. Tax schemes and laws are almost as retrogressive as equities laws and the SEC have

proved in the USA, but far more pervasive and so a much bigger dead-weight adding

massive friction and inefficiencies, slowing and restricting innovation.

Corporate Jobs - A necessary cost, not a social good

Large corporate businesses are, by their nature, machines. Designed to reduce costs, via

scale, and maximise output and/or profits for - well it varies, let's say shareholders,

executives and/or other stakeholders.

It's increasingly accepted that corporates have social responsibilities (aka CSR) but in

practice this is mostly a tack-on - when it's convenient and can be afforded. With notable

exceptions by-and-large corporates are good citizens when it suits them - and their current

PR objectives.

For them employing people is a necessary cost - not a social good. Getting rid of them - via

automation, AI and increasingly bots and robots, a strategic necessity.

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Working for...

Consequently the job-supply will inevitably shrink rapidly in the years, and decades, to

come. If they run true to form corporates will 'pocket the difference' reaping hugely

increased profits as a result of drastically reduced costs.

There's little or nothing governments can do to slow, much less halt or reverse this trend -

driven by the way corporate businesses are driven and use technology. If half the population

are out of a job long term, and that's about the size of it, who will they work for - or what

will we do?

How will we re-balance - or find a new kind of economy?

Livelihoods

Is there an alternative to life-on-the dole for many of the many? The answer lies in the

nature of jobs, work and markets. All of which have changed. and continue to change

rapidly.

Disintermediating Employment

Crowdfunding has made markets directly accessible to ordinary people, without the

traditional barriers to entry (a process traced in "New Routes to Funding"). It is empowering

entrepreneurs and innovators and disintermediating employment in the same way other

forms of fintech have and are disintermediating banks.

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Entrepreneurship for all

Entrepreneurship is no longer an elitist or aspirational activity - but like literacy, education

and university entrance, is, consequently now open to all - according to each ability, drive

and desire.

The stats we see, every day, from hundreds of thousands of crowdfunds around the world,

show that this is already happening.

"Working the Crowd"

NESTA's offering on crowdfunding, which mistakes it for a niche activity, is called, rather

uncomfortably "Working the Crowd" - conjuring a vision of a would-be star entrepreneur

herding lesser mortals towards that entrepreneur's desired goal, product - or crowdfund at

least. To my ear it smack of a many-few elitism, which is why I find it mildly distasteful.

This impression was only strengthened when in discussing approaches to making

crowdfunding and so entrepreneurship more accessible, speaking with those leading on the

subject for NESTA, their only question was 'why?'. Why make it easier? It's supposed to be

difficult.

The Capital Disease

Suffice it to say that while I have yet to hear that view advanced outside the capital - quite

the reverse in fact, the sentiment generally seems to evoke a mix of surprise, dismay and

outrage - I've heard the like expressed repeatedly - including by some of those tasked with

leading, supporting and encouraging entrepreneurship and innovation nationally -

repeatedly inside the London/Westminster bubble. I doubt that London is alone in this

however. It seems to me a 'capital disease' - capitals are, after all, in many ways 'the

incumbents', the most successful of which with an elite who are no doubt tempted to see

themselves as those with 'something to lose'.

Working FOR the Crowd

The problems of re-balancing - and re-engineering - the economy are problems for us all.

Including the corporates (who have until now mostly shunned any such leadership roles) as

ultimately they need consumers wealthy enough to consume their output. A shrinking

market is not good news - far from it.

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As in earlier times when there was a natural migration from the fields to the factories, the

country to the cities - where the work was - so there will inevitably be a migration from

offline to online and from corporates to the market direct. For one simple reason - it's

where the work is. Working for the crowd.

Working WITH the Crowd - A significant development for society

However this is not just a job reinvented. Or even business-creation-as-usual. As we have

seen because such entrepreneurs are now in direct contact with their market Adam Smith's

'invisible hand' becomes not just visible but tangible (a real dialogue) and so can be engaged

and, as it were, shaken. A two way conversation - with the voice of the market willingly

helping, guiding and working with providers.

This is a significant development to society, capitalism and so economics. One which

economics has yet to address - and with which it will find considerable difficulty - given that

its own foundations are in assumptions that no longer hold true. And that the nature of the

'job', employment and the market have all changed.

People's Passions - literacy, education, expectations...

People, given the opportunity, are not indolent (as Adam Smith believed) but passionate

and productive. We may argue about what (if anything) has changed, how and why this is.

Universal literacy and basic education (and beyond) - and the complex web of expectations

and assumptions that go with them - surely play a part.

Hyper-connected conversations and cash

Crucially to this understanding though is the hyper-connection of us all - via the social-web.

The removal of frictions, with e-commerce and other fintech increasingly providing new and

better routes around the banks, gatekeepers and rent-seekers. All this together, culminating

in crowdfunding's ability to direct-connect a would-be entrepreneur directly with a market.

Removing stages, removing risk, removing a need for capital-at-risk

Supporting a dialogue even before design is complete or production begins. Cutting out

several hugely cumbersome, wasteful, non-productive changes that previously had to be

funded by somebody-else's capital-at-risk (aka investment). Removing these stages removes

the risks (rather than merely mitigating them) - information removing uncertainty - and with

it the barriers to entrepreneurship.

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Transforming the Entrepreneur's Journey - Opening the Economy

Transforming, as never before, the role and path of the entrepreneur. To open the economy

to the many - not just the few. To change the nature of work as well as innovation, design

and production.

Creating the basis a new kind of economy based not on 'jobs', with the many working for

the few, but on livelihoods, with the many working for and with the crowd. Working for

each other.

Working for each other

The social-web has already torn down the wall of divide, providing two way conversations -

and the means to come-together, around an idea. Adding e-commerce made it possible to

get paid. Crowdfunding provides a new more positive and collaborative model, and a

platform blending all these elements, bringing people together around an idea, product,

proposition or cause.

“At the heart of every successful crowdfund is an idea, a proposition or a cause that enough

people care about enough to fund its inception. This is the engine room of the new economy,

a new more democratic capitalism that requires no capital.”

Making working for, and with, each other possible. The greatest 'industrial' (and societal)

revolution ever - and the most democratic.

The future of work for many of the many

We think of this as a new lens to understand the now economy. A fresh analysis based on

what we now know, on the data we now have - rather than obsolete assumption. We call it

Crowdonomics.

This is not the death of the old corporate economy, or not yet - newer technologies often

supersede rather than entirely replace the old - but it is, perhaps, the abolition of wage-

slavery - and the master-servant relationship that has, with traditional employment,

pervaded society since the abolition of its forebear.

It's clear to us that working for, and with, the crowd is a new choice for us all - and future of

work for many of the many.

(C) Copyright Barry E James, August 2016

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