Classroom Companion: Business

particular problems in various fields of computer science.
Clickworker offers “micro-jobs” to volunteers. Potential collaborators register in the 
community run by the company and are allocated jobs in accordance with their reported 
skills and earlier accomplishments. The company pays for the jobs each individual does 
for them. These jobs range over a large field of problem areas, for example, software 
development, proofreading of books and manuals, information gathering, and process-
ing of unstructured data. The participants are connected to the company on a freelance 
basis, and they decide themselves when and how much they want to work.
◄
7.3 
 Production Tools
The most important challenges related to design and production of digital goods 
are financing the development and reducing the running production costs. For new 
startups, it may be difficult to persuade banks, venture capitalists, and other inves-
tors to put money into the project. Financing the project may then be achieved by 
crowdfunding or peer-to-peer lending. The development costs may be reduced by 
using free and open-source software, and investment and running cost may be 
reduced by renting processing and storage capacity from cloud providers.
7.3.1 
 Crowdfunding
Crowdfunding is a way to raise funds for projects or startups by inviting people to 
invest in the venture. The interactions take place over the Internet. The investors 
usually receive shares in the startup or company owning the project equal to the 
amount of money they have invested. Most fund-raising events are small but some 
of them are huge. In 2018, a Cayman Island startup raised more than 4 billion US 
dollars for developing a blockchain platform (Rooney, 
2018
).
 
Chapter 7 · Production Models

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7
Crowdfunding may refer to several types of funding mechanisms (Hellmann 
et al., 
2019
).
5
The most widely used method is peer-to-peer lending (see next).
5
Equity-based crowdfunding implies ownership of securities in the company or 
project. These are then usually high-risk investments.
5
In reward-based crowdfunding, the investors receive services or other benefits as 
reward for their investments. In this case, there is no guarantee that the compen-
sation will match the size of the investment.
5
Donation crowdfunding is mainly used for supporting charitable causes, and the 
donor does usually not receive any compensation for the investment.
There were more than 2000 crowdfunding platforms in 2016 (Drake, 
2017
). Kick-
starter is one of the most successful of these platforms.