Ask most entrepreneurs and they'll tell you how tough times are.
Small-business owners, especially those just starting out, typically need funding from banks to get going and a steady stream of revenue to stay afloat. And startup capital apparently is just not as available as it used to be. According to one study, 61 percent of small business owners said it's more difficult to get a bank loan now than it was four years ago.
One St. Charles small-business owner has a work-around for the banks and is trying a different approach to raise funds.
”Crowdfunding is really starting to get some legs, and not just for philanthropic reasons."
Steve Mastio, a 51-year-old entrepreneaur who owns Business Clean Inc. on Indiana Street, is seeking investment from a crowdfunding website to launch a new web-based business.
St. Charles Patch originally featured Mastio’s project, , in August. FittleBug is a tool developed by Mastio for booking everyday services online. Once a business is set up with FittleBug, customers can use it any time of the day to schedule a service exactly when they want it done. Mastio said it eliminates the need to wait in line or track down an employee over the phone.
The site Mastio is using, TechMoola.com, provides a platform for donors to give relatively small amounts of money to startups. TechMoola describes itself as a "forum for project fundraising." It was created by two Chicago-area men, according to the company's website.
The concept behind "crowdfunding" is that an entrepreneur who needs money can turn to the masses. The Internet has made it easier to solicit funding this way.
"Crowdfunding is a new way of doing business through community-based democracy," according to the TechMoola website.
The practitioners seem to be in the small-business community, who have started turning more to the public for startup capital and continuing funding needs.
Legislation is moving through Congress that would make it legal for small investors to crowdfund startups and retain a stake in the business, The Huffington Post reports. Currently, donors to crowdfunding sites are not able to invest in the businesses they're funding.
Mastio said believes there are many people out there who believe in helping entrepreneurs, to fuel crowdfunded donation sites.
“Crowdfunding is really starting to get some legs, and not just for philanthropic reasons,” said Mastio. “The only options these days are to try and ride it out and not bring the product out as fast … or take it to something like crowdfunding.”
Mastio's project was featured on TechMoola Feb. 7 and that will last for about 90 days. Those who donate won't gain any investment in the business but, for their donation, will will receive a gift. The larger the donation, the more elaborate or expensive the gift Mastio provides.
What Mastio is hoping to spark, he said, is the same sort of entrepreneurship that was far easier to pursue several years ago. Small-business owners seeking money to launch their dream, one of the fundamental components of the U.S. economy, is still seen as something to support.
“These people, first and foremost, want to help people like me. And if they can get something for it, that’s all the better. They want to see guys like me succeed.”
You can find more articles from this ongoing series, “Dispatches: The Changing American Dream” from across the country at The Huffington Post.