What is Breach of Contract

Crowdfunding is a balance of risk versus reward. Crowdfunders take a public risk that they will fail to raise funds. Donors take the risk that the campaign will not be funded or that they will not see a return for their support. In an ideal world, both sides are rewarded through the development of something new. If the campaign is being run by a staff member at a large organisation, the organisation should consider a number of risks. These include legal risks such as corruption and misrepresentation, as well as reputational risks and risks relating to exploitation of staff. There is also the risk of funding foregone due to excessive caution regarding crowdfunding. This chapter uses universities in Australia as a case study to illustrate some of these risks. It analyses them through a framework for managing risk in business centric crowdfunding platforms. It contributes a new framework for ameliorating risk before, during, and after crowdfunding campaigns.