New York-based startup Pave launched with the idea to allow investors to put their money not into startups or companies or ideas, but into people. The idea was to highlight a group of potential prospects who wanted to get a particular personal project off the ground and to help them get that funded. In return, those who contributed money to help would receive a small share of their future income afterward. Now it’s offering a way for backers to pay it forward, with a new investment plan called Ripple.
For prospects, Pave provides the ability to get things funded that are more creative or aspirational than through other crowdfunding platforms. And it enables backers to bet on individuals — like a filmmaker or martial artist — looking to pursue individual dreams.
While still in the beta phase of its rollout, Pave has had a number of its prospects already backed, and hopes to continue adding more as time goes on. During its pilot phase, the average campaign size was around $24,000, with some as high as $75,000 and others as low as about $2,500.
At first, the platform was opened just to accredited investors — which for individuals would mean people who either have a net worth of more than $1 million or who make more than $200,000 a year. Those people would then receive some return on their investments in Pave’s prospects.
But that potentially limited the base of backers that could participate in its platform. So Pave has introduced a new way for backers to make contributions with its new Ripple “Pay It Forward” option. With Ripple, backers don’t have to be accredited investors, and they won’t necessarily be expecting individual returns based on future income. That’s because instead of having that money go back to the backer, it gets pooled into a fund that can be reinvested into other prospects and projects.
Essentially, returns from Ripple contributions end up being reinvested into others on the platform. That offering will be open to anyone, but backers must contribute at least $250 as part of the program. Anyway, it’ll be interesting to see if this new model takes off, and if it does, how it changes the way we think about crowdfunding people rather than products or companies.