Small capital is collected for donation and investment. Charities and donations are almost identical, both aimed at helping the poor.
In collecting funds for charity, the goal is usually not investment. It is only to improve the life of an individual or a group, but in donations, the goal is to finance a starting business or help a failed person. The third type of fundraising, known as collective investment, is done only to invest in an activity that requires a lot of investment. Still, the investor alone is not able to run that activity.
In the first two cases, the goal is purely spiritual, and investors or donors of capital do not consider the financial profit. However, the mechanism of action is the same as a collective investment. But in the third case, the purpose of the investment is to make a profit by starting a profitable activity. Investors alone are unable to launch a business due to a lack of capital. The main difference with participating in an action in a joint-stock company is the amount of investment, the number of partners, and the number of shares. Collective investing is a sort of new concept in investment. It is commonly used to invest in small and medium companies and startups.
In this way, companies collect small assets to gain the capital needed to start a business or provide money to do a stage of work. In return, all investors will share in the profits of the activity based on the investment made.
To guarantee the return, the investee issues a stock certificate for investment. Based on this certificate, the amount of capital and the amount of participation of each person are determined.
Various factors prevent significant investors of the capital market and banks from investing in startups and services. One of the most important factors is the ineffectiveness of investment.
This is another reason that attracts crowdfunding because small capitals are unable to enter large capital markets, so these capitals are stagnant in bank accounts or blocked in-home funds, and They are out of the circle of capital rotation.
Those who have this capital have obtained it with difficulty and are not readily willing to give their little capital to others; these people use capital only as a means of subsistence and not as an opportunity to increase the initial capital. They are very timid and cautious about their small fortune, especially when successive economic crises without financial transparency undermine investor trust in financial markets. People wonder why they should invest in ambiguous actions, with reports full of confusing complexities and irresponsible behavior.
According to one of the older adults in my family, I trust my pillow more than the banks.
“Trust is your only asset in the economy, the rest revolves around it,” says Stephen M.R.K. in his book named the speed of trust.
The first indicator that builds trust is honesty, truthfulness, clarity, and transparency, telling others how much you are right.
The right ones show your personality to others with all transparency and tell them that you have the right personality. Another thing that is important in trust is your ability to do your job. You may be an honest person and show complete clarity of how truthful you are but do not know how to do things right. Or you may not be transparent in doing things and showing them correctly, and your action is full of ambiguity.
In this case, too, the only thing that helps you gain trust is transparency in submitting work reports. This action shows that you are a person with character and merit. Or your plan is a plan with personality and worthy of investment.
This is where the concept of trust protocol comes into play. Blockchain was introduced to the world with precisely this motivation. Transparency and trust are the main driving force of this technology.
Blockchain reflects the concept of this rich and beautiful Iranian culture. A handkerchief is spread among the crowd to support someone who has gone bankrupt, and everyone, in turn, helps the helpless person.
All the money is poured into a handkerchief, and everyone present is watching the operation. There is no cash register, no account, and no cover; everything is done in front of everyone and complete transparency. Young and old, poor and rich, the mentor and the disciple are all aware of the minor details. Everyone observes the donor and the money. This transparency leads to satisfaction in everyone, and this satisfaction builds trust among the donor network. Next time, people donate with pleasure.
Blockchain is a technological donation with the same transparency in character and competence. It has a personality because it collects the right amount. It is competent because it has shown how capable it is in presenting bitcoin as a currency and how it contributed to the other cryptocurrencies in supply and growth. It has numerous applications in all industries.
Service, cultural, social organizations, non-governmental organizations, and charities can use the features of this technology to collect public donations and collective funds. At the same time, donors can track their whole operation and contribution transparently through the system.
Capital markets and startups and small and medium-sized enterprises, and even small and large national projects will be able to raise small capital by offering shares in the form of a transparent and trustworthy protocol and significant profitable activities. At the same time, even the smallest investors are aware of the details of the work at any time and any stage.
A penny saved is a penny earned, but there are no caves and dark corners in this ocean, and no shell hides pearls.
