Editing Syndicate (section)

== Crowdfunding ==
Researchers argue that syndicates may reduce the potential for [[market failure]] in crowdfunding, a method that allows creators to raise funds for projects from many different investors through online platforms. Equity crowdfunding allows creators to issue equity to investors when they make an investment in the project. In equity crowdfunding, information asymmetry between the creator and investor may result in a variety of problems and, in some cases, market failure.<ref name=":0">Agrawal, Ajay, Christian Catalini, and Avi Goldfarb. "Are Syndicates the Killer App of Equity Crowdfunding?" ''California Management Review'' (2015): 1-16.[https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2569988] {{Webarchive|url=https://web.archive.org/web/20170223003527/https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2569988|date=2017-02-23}}</ref>

A syndicate can be started by an individual, angel investor, or venture capitalist. An individual who wants to form a syndicate creates an investment strategy and discloses it on a crowdfunding platform. Other investors can choose to back the individual, who is the leader. The backing investors must follow the leader's investment strategy and pay them a fee. Syndicates do not exist on all equity crowdfunding platforms.<ref name=":0" />