Fundraising Crowdfunding-Unless you’ve been living on a deserted island for the past few years, you’ve probably heard of crowdfunding and stories of people raising hundreds or millions of dollars over the internet.
Indeed, there has been so much talk about crowdfunding that individuals like to say things like “yes, I’ve heard there are approximately 500 crowdfunding sites.” As the CEO of equity crowdfunding platform Crowdfunder.com, I have a unique perspective on the sector. While there may be hundreds of potential sites, only a few have real communities and significant fundraising successes to their credit.
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Which begs the question: what is the best crowdfunding platform for you?
[Disclaimer: I’m the CEO of Crowdfunder and have personal contacts with several of the founders and teams at the sites listed; nonetheless, I stand by my recommendations as helpful advice for those looking for the proper site.]
As a crowdfunding industry insider, I thought I’d provide you with a simple guide to determining which site is best for your needs.
I’ll begin with a brief introduction of the industry, followed by a quick lesson on the various sorts of crowdfunding so you know what you’re looking for, and then, particular recommendations for you.
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The Crowdfunding Business
Collaboration on the internet is exploding in popularity. One of the standouts for growth in this growing collaborative economy is crowdfunding, or collaborative funding over the internet.
According to Massolution’s Crowdfunding Sector Report, the worldwide crowdfunding industry raised $2.7 billion in 2012, with more than 1 million individual projects. The sector is expected to increase to $5.1 billion in 2013.
Investment crowdfunding (becoming a shareholder in a company), localization (funding focused on participants in specific cities and neighbourhoods), mobile solutions, and group-based approaches are some of the most interesting developments in crowdfunding that are expected to grow in the months and years ahead.
The JOBS Act, passed in April 2012, set the path for investment crowdsourcing, but the SEC’s JOBS Act Rulings have yet to be completely implemented in order to properly launch the market. In 2013 and 2014, expect a lot of movement and activity in this sector.
Models of Crowdfunding
There are two primary sorts of crowdsourcing models. The first is a type of fundraising known as donation-based funding. This approach gave birth to crowdfunding, in which funders pay in exchange for products, benefits, or incentives through a collaborative goal-based process.
The second, and more modern, option is investment crowdfunding, in which businesses seeking finance offer equity or debt ownership holdings online. Unlike the gift model, those who fund become owners or shareholders and have the possibility for financial gain.
There are a variety of crowdfunding websites to choose from.
Different crowdfunding portals are used by business owners and performers. Musicians are donating to various causes and organisations through various websites. A list of crowdfunding platforms with various models and focuses is shown below. This list might assist you in locating the best option for your crowdfunding goals and requirements.
1. Kickstarter
Kickstarter is a website where people may donate money to support creative projects. These initiatives might range from the development of new creative items, such as an art installation, to the pre-sale of a music record. It is not intended for use by enterprises, causes, charities, or individuals seeking personal financing. Kickstarter was one of the first sites, and it has seen rapid growth and a slew of large-scale initiatives in recent years.
2. Indiegogo
Indiegogo approves donation-based fundraising campaigns for almost anything — music, hobbyists, personal finance needs, charities, and whatever else you can think of. While Kickstarter maintains a tighter focus and curates the creative projects approved on its site, Indiegogo approves donation-based fundraising campaigns for almost anything — music, hobbyists, personal finance needs, charities, and whatever else you can think of (except investment). Because of their flexibility, broad approach, and early start in the market, they have experienced international expansion.
3. Fundraiser
Crowdfunder.com is a platform for raising investment (rather than incentives), and it has one of the largest and fastest-growing investor networks. Due to a storey about a $2 billion exit of a crowdfunded company, it was recently featured on Fox News as the new breed of crowdfunding. Companies frequently provide the audience the opportunity to participate at Crowdfunder to finance more formal Seed & Series A rounds after receiving rewards-based funding on Kickstarter or Indiegogo.
Crowdfunder is a prominent participant in the JOBS Act legislation and now only accepts equity crowdfunding from individuals, angels, and venture capitalists.
4. RocketHub
Rockethub is a platform that facilitates donation-based fundraising for a wide range of creative initiatives.
RocketHub’s FuelPad and LaunchPad programmes are unique in that they assist campaign owners and potential promotion and marketing partners interact and collaborate for a campaign’s success.
5. Raise funds through crowdsourcing
Crowdrise is a platform for non-profits and causes to raise money through donations. They’ve attracted a community of givers who donate to a variety of worthwhile organisations and needs.
On Crowdrise, a unique Points System allows members and organisations track and display how much humanitarian effect they are having.
6. Somolend
Somolend is a small company loan site in the United States that offers debt-based investment finance to qualifying firms with established operations and revenue. Somolend has worked with banks to provide loans as well as assisting small company owners in enlisting the aid of their friends and family.
Somolend has begun expanding into several cities and markets across the United States, thanks to their Midwest roots, a strong founder who was a key contributor in the JOBS Act legislation, and their emphasis and leadership in the local small company market.
7. appbackr
Check out appbackr and their specialist community for mobile app development if you want to build the next big mobile app and are looking for donation-based funding to get things started or grow.
8. AngelList
AngelList can help you discover investors if you’re a tech startup with a shiny lead investor already on board or if you’re seeking for Silicon Valley momentum. AngelList didn’t claim they did crowdfunding for a long time, which makes logical given that they cater to the investment establishment of VCs in tech businesses, but they’re suddenly going into it. A increasing number of prominent tech startup deals have been funded by authorised investors and organisations on AngelList.
9. Invested.in
You could want to start your own crowdfunding platform to facilitate donation-based fundraising for a certain cause or market niche. Invested.in is a top-name “white label” software supplier based in Venice, California, that gives you the tools to get started and expand your own business.
10. Unusual
Quirky is a platform for inventors, makers, and tinkerers to collaborate and crowdfund for donation-based funding with a network of other like-minded people. Their website delves farther into assisting in the development of an innovation or product, allowing community input.
These ten crowdfunding sites cover the majority of campaign kinds and financing goals. Whether you’re trying to fundraise or not, take a peek at the sites that catch your eye and join this collaborative community.
