When you’ve got a cool startup idea, raising the initial funding can be the hardest part. In fact, the broken state of startup investing seems to be a topic at every conference I go to these days. Now Jessica Jackley, who brought a new approach to nonprofit fundraising with Kiva.org, is working to do something similar for startups and small businesses with a site called Profounder.
Since they haven’t launched yet, Jackley and her co-founder Dana Mauriello aren’t offering any details about the company. All I really have to go on are the descriptions in a job listing and the Profounder website. It looks like Profounder is aimed at both tech entrepreneurs trying to raise funding and more traditional small businesses. Here’s the description from Profounder:
On our online platform, entrepreneurs can:
- create a clear, simple, legally compliant pitch (including customized terms) to raise both equity and debt financing up to $1M
- invite their friends, family members, colleagues, and broader communities to contribute, including those on LinkedIn, Facebook, Twitter, and other social networks
- transact online to collect their investments
- manage their community of supporters, including repaying and rewarding investors, providing regular updates on business progress, and more
There are some parallels between Profounder and Kiva, which Jackley cofounded with her then-husband Matt Flannery. Kiva’s goal was to create new opportunities for businesses in the developing world by allowing Internet users to support them via microloans. Profounder could create new opportunities for startups and small businesses by helping them raise money from family, friends, and their communities. I like the idea that the site could support startups that might otherwise struggle to raise funding — which, as The New York Times pointed out in a recent article about the dearth of women in tech, can happen even if you have a great idea and real experience.
Profounder lists LinkedIn chairman Reid Hoffman, former Linden Lab CTO Cory Ondrejka, and Prosper CEO Chris Larsen as some of its advisors, which should help ensure the company gets the financial and legal details right, so these deals don’t blow up down the road. The website says Profounder will launch with a small group of entrepreneurs sometime this spring.