Crowd-funding is normally used to raise money for a particular cause. Whether it is for a charity, or getting a new project off the ground, you normally know what your money is going to. I’ll keep this relatively short.
Let’s look at Project Brabham. Project Brabham wants to:
Brabham Racing will initially compete in the 2015 FIA World Endurance Championship, which includes the prestigious Le Mans 24 Hours. The ultimate dream is to bring this same model to Formula 1 and potentially other exciting series such as the FIA Formula E Championship.
So far, 2,628 backers have raised £247,930. That’s an average of £94.34 a backer. I can see on the Indiegogo site who has backed Project Brabham. Donations range from £1.00 to £100.00, as you would expect. Project Brabham is a journey, and by being part of Project Brabham, you get to be part of that journey. This is a team effort. Project Brabham has an end goal. It has a target. It may happen, it may not. It has ambition.
On the other hand, Caterham. Caterham wants to:
The Caterham F1 Team is launching the #RefuelCaterhamF1 to power the team to go racing in Abu Dhabi and hopefully beyond. The team is giving both fans and sponsors a unique opportunity to be the driving force behind the team by crowdfunding its return to the grid in exchange for once in a lifetime rewards.
So far, 1,845 backers have raised £1,057,102. That’s an average of £572.96 a backer. Straight away, alarm bells. Either Formula 1 fans are extremely rich, or something dodgy is happening. I also question exactly what happens after Abu Dhabi. Where does that £2.3 million go? What is frustrating here is that, on the CrowdCube website, I cannot see who has backed the Caterham crowd-funding effort. Furthermore:
So, one person added £100k to the effort, and another added £300k to the effort. Which brings that £1.06m total down to about £500k (assuming there are one or two other large amounts in there).
Does it matter? At least with a lot of small amounts in Project Brabham, you can say it is legitimate, but when you start throwing large amounts in there with Caterham, alarm bells start ringing. Does it matter that Caterham’s administrators are also CrowdCube’s service accountancy and tax advisers?
I want Caterham to make it to Abu Dhabi. But, at the same time, I’m concerned by the very large amounts of money being thrown at this, by what appears to be a small group of people. By the looks of things, Formula 1 fans are making a small difference. One or two businessmen, on the other hand, are making a very large difference…
Update on November 14th – Another half a million has popped up out of nowhere.