Do you have a great idea for a business, a film or a research project? Are you too broke to make it happen? Crowdfunding could be the answer.
Crowdfunding is a way of connecting people with ideas to people willing to fund them, and it has helped some innovators skip the step of applying for a bank loan to get their start. It’s the preferred method of raising startup cash by people without the financial track record, or collateral, that a bank requires before offering loans.
Crowdfunding happens on the Internet. Several sites allow people to appeal to many small investors at once — most often the audience is made up of regular people, not financial-sector types. They are people who are interested in a project for all sorts of reasons and want to see it succeed. An artist or entrepreneur proposing a project will offer these “everyman investors” prototype products, T-shirts, discount coupons or even a share in future profits.
To raise funds, you have to convince potential donors that you can execute your idea. The money they put on the line is a vote of confidence.
The top 2013 crowdfunding campaigns raised money to produce a 3-D printing pen (3Doodler), smart watches (Kreyos), a location device (Stick-N-Find) and home security system (Canary), feature movies (including “Veronica Mars”) and computer games (notably, “Mighty No. 9”).
Experts on the latest developments in crowdfunding offer these tips on raising funds for social projects and startups. Learn also from Kickstarter and Forbes magazine how to start a successful crowdfunding campaign.
If you’ve never used crowdfunding, you can explore one of these platforms:
- Kiva accepts loans as little as $25 to help people escape poverty.
- Kickstarter funds creative projects in the arts, photography, film, design, gaming and technology.
- Indiegogo covers a broad range of projects, from charitable causes and art to new technologies.
- Crowdrise focuses exclusively on fundraising for charities and worthy causes around the world.
- RocketHub supports artists, activists and entrepreneurs seeking funds.
- Tilt makes it easy for groups and communities to fundraise or pool money for their projects.