The billionaire businessman plans to give away three suitcases full of cash Wednesday to advertise the start of FundAnything.
Television personality and businessman Donald Trump is set to announce Wednesday the launch of his latest venture—a crowdfunding site called FundAnything, which is designed to compete with leaders in the field like Kickstarter and IndieGoGo.
Like other properties associated with Mr. Trump, FundAnything uses "the Donald's" brand to promote Mr. Trump as much as it does the product itself.
"I'm giving away MONEY!" reads the banner beneath a photograph of Mr. Trump dressed in a black suit and gold tie.
A company spokeswoman said Mr. Trump is a financial partner but not a founder of the site, which lists as its creators Learning Annex founder Bill Zanker, and entrepreneurs Scott Tilson and Jeno Torocsik. Mr. Trump is a longtime featured lecturer at The Learning Annex, an adult education company.
Though Mr. Trump's celebrity could help the site compete for users and donors, FundAnything does not appear to offer a different model from crowdfunding sites out there already, just one that was more expensive.
Tech experts noted that FundAnything collects 9% of the money raised for campaigns that do not meet their pre-stated goals, and 5% for those that fully fund their campaigns. That is steeper than IndieGoGo, which collects the same 9% commission on campaigns that fall short of their monetary goals, but only 4% for completed campaigns.
Kickstarter's pricing model is slightly different. The site does not give a campaign any money unless a project meets its goal. In that case, it charges a 5% fee. The crowdsourcing site with the lowest fees, CrowdTilt, takes a 2.5% cut if a campaign reaches its stated goal.
Rachel Sklar, an adviser to numerous tech companies and co-founder of Change The Ratio, which increases visibility of women in tech and new media, criticized Mr. Trump for saying that he was giving away money when the site does not appear to back up that claim.
"FundAnything.com seems to open with at best a misrepresentation, at worst a lie: a picture of Donald Trump with the tagline 'I'm giving away MONEY!'" she said. "Nowhere on the site is there any indication that Donald Trump is contributing, donating, matching or otherwise giving any money to anyone. It very clearly states that you can raise money from your network, for which the site will collect a fee."
A spokeswoman for FundAnything said Mr. Trump "will be contributing hundreds of thousands of dollars over the course of his involvement with FundAnything, and tweeting out to his 2.2 million followers weekly." She said she did not know the specifics of his financial involvement with campaigns on the site.
The spokeswoman said Mr. Trump on Wednesday plans to give away three suitcases filled with an undisclosed amount of cash in them to campaigns he has decided to help: someone with a life-threatening medical problem, a business owner wiped out by Superstorm Sandy and an aspiring singer-songwriter. Some people attending the planned event at Trump Tower at 725 Fifth Ave. "will also be selected to receive additional piles of money," according to a press release.
Tech leaders said Mr. Trump's entry into a field dominated by scrappy Ramen-noodle eating programmers is a sign that their ideas are here to stay.
"It's a real validation of what IndieGoGo has established over the last five years and how our crowdfunding philosophy is disrupting finance that someone as accomplished as Donald Trump is offering us the sincerest form of flattery," said Slava Rubin, founder of IndieGoGo.
Ms. Sklar agreed: "What better proof of concepts can you get than the Donald putting his face on it and charging an additional 1%."
Annie Karni is a reporter with sister publication Crain's New York Business
