Q&A with Sang Lee of Return of Change
VSM: For those who may not be familiar, what is Return on Change?
SL: Return on Change is a crowdfunding platform that aims to provide an online medium by which start-up companies and bright entrepreneurs will be able to pool capital through crowd sourcing – all the while creating a community of advice and collaboration. Our objective is to empower talent by breaking through traditional modes of funding, bridging the gap between innovation and business, and providing entrepreneurs with a much-needed, alternate method of funding their ideas. Through RoC, everyday investors will be able to support socially conscious and high-impact ventures while still commanding financial returns.
VSM: How did this idea form?
SL: What began as an idea to assist socially conscious ventures raise capital grew into the RoC platform with the passage of the JOBS Act.
VSM: What impact has the Jumpstart our Business Startups (JOBS) Act had on the business world?
SL: The JOBS Act is groundbreaking legislation because it democratizes access to capital. Non-accredited investors will be able to participate in funding rounds, which will naturally lead to the founding of more sustainable startup companies. This will not only stimulate job creation but also give fruition to innovative ideas that previously may never have been realized due to traditional capital constraints. One of the most important consequences of the JOBS Act is that all ideas are given an opportunity to receive funding and feedback from the general public; no longer will the top 0.005% of wealthy individuals be the only ones who have a say in what constitutes a good, profitable idea.
VSM: What about crowdfunding? How much is it changing the way businesses & investors interact?
SL: The concept of crowdfunding focuses on collective cooperation where businesses are able to freely raise capital in a public forum without the usual restrictions and costs associated with regulations set forth by the SEC. It is designed to benefit fledgling businesses that are unable to bear the cost and time of having to abide by cumbersome and expensive filing requirements. Whereas angel investors have no choice but to demand high equity stakes to minimize risks involved in investing, crowdinvestors can command less strict terms from the startups they support because of the inherently lower risk of investing affordable amounts of money. With crowdfunding, startup companies are free to spend less time on attaining funds and focus more on improving their ideas with the advice of everyday investors. This engenders an intersection of community and business - startups receive feedback from a following that is genuinely interested in their ideas. In turn, these highly interested investors raise awareness in their own respective networks and achieve a collective effort of brand marketing.