Food Funding: a good deal?

Today I've been in a Twitter conversation with a sort of local business about 'food funding'. At any rate this appears to be the name for what I've been discussing in 140 character bites.

In essence it's just another term for crowd-funding, but in particular for food businesses. In a recent article on the subject for the Evening Standard, Victoria Steward commented:

Usually there are rewards for crowd fund investors, which can be anything from a t-shirt to tax relief. Most importantly, it draws on communal instinct.

It seems like the crowd funding model followed by much of the food business is the reward for funds model rather than the investment for funds one.

Here's a fairly typical offer from US-based Foodfunding website Three Revolutions. On a rising scale, here's what you get for your investment:

My instinct tells me that if I'm helping someone I've never met to set up a business for profit, I'd want a much fairer distribution of returns than a T shirt or hot tamales at my house. But there again, if this were a food business for my high street, I guess I'd take my position and place my bets. There's a return of sorts; I get somewhere I want to eat and an improved high street environment. But there again, what happens if they do well then push off after a year? I'm sure an argument could be made that even being open for just a year it would leave a legacy.

So here's where I think I'm at with this, I might fund, for example Harringay Market, but I'd need convincing that my funding a for profit business would have a lasting impact on the neighbourhood or some other return. Whatever the case, I think I'd tell them where to stick any hot tamales on offer! 

I wish these entrepreneurs and all who sail in them the best of British, I really do, but it seems to me that some of them are on to an awfully good thing here. Does this easy money really create good sustainable businesses? If you want my money, being part of a new fad just won't cut it for me. Show me how you benefit me, my community of even society at large. Otherwise I can think of plenty of better ways to spend my communal instinct. (Or is the issue that I'm really just a hopelessly out of touch 20th Century Boy?)

Article: Introducing London's food funders, Evening Standard.