Traditional equity investment is highly regulated. This is meant to protect investors but also acts as a barrier to entry for smaller actors who may have spare capital to invest, but cannot because they are insufficiently wealthy. As a result, those investors cannot invest at all until a company goes public. As a result, smaller investors miss out on the high-risk, high-return options that venture capitalists have access to.

The ability of smaller investors to become involved means that investor-fans, people who invest for reasons other than a pure profit motive, can be a far more powerful force. It's worth asking which is the better investment—a company that can convince a VC to give them $10 million, or a company that can convince 1,000 people to part with $10,000.