Over 100 people rallied on Butler University campus last week to celebrate the launch of Localstake, a new web platform (now in beta) that looks to help entrepreneurs microfinance their venture with local resources. The Localstake launch brought an eclectic crowd of investors, software developers, and friends of founders to build support for the startup and to help explain the business model.
The basic idea behind Localstake is pretty simple:
Much like crowd funding platforms like Prosper and Kickstarter, Localstake looks to help entrepreneurs raise capital in small amounts to help fund their business. But their platform provides, among other things, entrepreneurial education, collaboration tools, and more of a local focus.
Local focus = value-added capital. The companies that have the most to gain from funding through Localstake are those who would have a significant benefit form having a strong, local customer base.
But it may be difficult to execute.
The three-person founding team is obviously a financially savvy lineup, but there are some securities laws that could present themselves as obstacles down the road. There are some bills that may completely change the game for crowdfunding, but until they’re passed, securities law may still be a wild card for this startup.
It’s an ambitious idea that could completely change the way businesses raise money locally. Would you use it?