Capital Market Innovation

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Andrew Wiseman reports on the latest food cart concept:

Now, though, there’s one you can literally help bring to the street: Purveyors of Rolling Cuisine (PORC) is a nascent pork-based cart looking for funding. Instead of getting some investors or asking Mom and Dad, they’re doing it the crowd-sourcing way, using a website called Kickstarter where people pledge money. In return, donators get freebies, like meals, shirts, and charitable donations.

It’s sort of like PBS, but for pork.

When I first read that, I thought this was an innovative way for entrepreneurs to do some disintermediation of the banking system. But I clicked through and saw that this is literally like PBS, you’re just giving them money in a way that guarantees losses. A $25 donation gets you “two complimentary meals (entree and drink) from the truck,” a much less than $25 value. I don’t really understand why you would do this when you could give your money to an actual charity.

This is all too bad, because I think the idea of trying to run this as a real investment is a promising strategy for projects like this one that don’t need much capital. Right now a one-year CD has a pathetic 1.34 percent yield. If some cartrepreneurs offered a bit more than that (1.45 percent, say) I bet they could raise the $30,000 from cart-loving yuppies who just want to be part of something new.