Can you crowdfund university education?
Crowdfunding is stretching its tenticles into an ever increasing array of areas. One area of particular interest is that of student finance. Around the world universities are charging ever higher tuition fees. With developed countries struggling with recession, state support is being removed, passing the burden onto the students themselves.
Of course, the idea of students turning to the web for financial support is not a new one, but efforts have often been on the seedier side of selling certain services on eBay.
Upstart aims to change that. They're a crowdfunding company, where the investment is not in a project or product, but in you. The company, which recently itself raised $6 million in fresh funding, exists to help students finance their university studies by offering investors a stake in their future income.
The offering has all of the hallmarks of traditional crowdfunding sites such as Kickstarter. Candidates publish a profile of themselves that describe their potential and also what they intend to use their investments for. Investors, who also have profiles of their own, can then offer cash to those who catch their eye.
In return for their investment, they will receive a percentage of that person's pre-tax income over a fixed number of years. This figure is typically determined by the individual when they create their profile, with the figure going as high as 10%. Individuals can also set a cap on how much is repaid to investors.
Upstart alone has already seen around 50 individuals secure investments of around $1.4 million using their site. They're far from alone however. In America Pave offers a similar service, whilst in Germany Career Concept do a similar thing. There is even a Latin American alternative called Lumni.
An additional feature of such sites is that as well as providing investment in promising individuals, investors can choose to mentor and support them in their formative years.
Suffice to say, such methods of funding are still but a drop in the ocean of student finance, but they do represent an interesting alternative to traditional finance options.