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Jenny Kassan of SELC (U.S.A):

"A security creates an expectation that the investor will receive a financial return. If someone gives money to a business with no expectation of a return, securities regulations do not apply. Many entrepreneurs (and others) are using so-called crowdfunding web sites such as Kickstarter and Indiegogo to raise money for various causes. Entrepreneurs that solicit donations often provide non-monetary rewards to donors. For example, a recent successful raise on Kickstarter for the New Parkway Theater in Oakland (a formerly popular theater raising money to reopen) offered the following:

Pledge $25 or more: Five free showings at the New Parkway Theater.

Pledge $50 or more: Two tickets to the theater, a pitcher of beer, a pizza, and a RESERVED loveseat.

Pledge $100 or more: Ten free showings at the New Parkway Theater and a +1 pass to the Grand Reopening Party.

This campaign raised $56,832, exceeding their goal.

At what point might a reward be valuable enough that it could be seen as a financial return on investment? This issue has yet to be tested, but it is advisable to ensure that any rewards offered are valued at less than the amount donated." (

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