Even so, I have my doubts that mob mentality and viral marketing will prove to be reliable diviners of good investments. That said, they may be every bit as good as say, a gated community of silicon valley entrepreneurs and angel investors. After all, in a sort of perverse coincidence, these people purport to predict mob mentality and viral potential. Maybe crowd-funding is just trading the experience and insider knowledge of the investor community to cut out the middleman.
In any case, I fully expect both sources of funding to produce plenty of gems, so I would fight to make sure both can survive and be strong.
The main thing crowd-funding has over big investors is that rather than having to predict what the mob will be interested in, the mob can be part of the investment process.
Sure, they might not be as good at judging potential to execute as a seasoned team of investors, but they'll be a lot better at gauging interest levels.
I also wouldn't underestimate the potential of having a lot of tiny investors becoming product evangelists; if you've got a thousand people putting $50 apiece into a project, that's not only a thousand first users, it's also a thousand real people that will happily post links to Facebook, mention the product in a blog, recommend it to their friends, etc. Especially because they presumably were interested in it in the first place.
In any case, I fully expect both sources of funding to produce plenty of gems, so I would fight to make sure both can survive and be strong.