•  
  •  
 

Cardozo Journal of Conflict Resolution

Abstract

Hoping to be the next Pebble, entrepreneurs and businesses have flocked to various crowdfunding platforms to contribute dollars to fund initial launches of products and other investments. As readers are undoubtedly aware, Kickstarter was the first and bestknown crowdfunding website, having helped to launch more than 95,000 projects to date. On March 3, 2014, Kickstarter reported that it passed $1 billion in pledges with over 5.7 million people donating to creative projects. There are currently over 800 crowdfunding platforms, with the bulk of dollars contributed going to social campaigns. Of course, as donations grew and the number of backers surged, poorly constructed items, delayed launch dates and failed projects began to be reported. Donating money for a cause is a good thing, until the project or product never come to fruition and then some donors are left without protection in such occurrences.

This Article asserts that online dispute resolution ("ODR") platforms, which are designed specifically to manage low value claims in an online environment, can and should be used by crowdfunding platforms to assist in the recovery of donor loss. If individuals who participate in crowdfunding have access to efficient, essentially cost-free procedures for dealing with their crowdfunding related disputes, they will have improved trust in and satisfaction with the crowdfunding platform, which will eventually lead to more financial support for entrepreneurs. The Article concludes by arguing that in the crowdfunding, community based environment, the community itself should determine acceptable behavior and as such, the community should resolve its internal disputes based on these newly created behavioral norms supported by an internal ODR platform.

Disciplines

Banking and Finance Law | Communications Law | Consumer Protection Law | Dispute Resolution and Arbitration | Law | Science and Technology Law | Securities Law

Download

Share

COinS