A Brief Insight into Crowdfunding

Very few people can start a business with their savings or funds. The funding provided by investors raised the majority of the companies that we see today. These investors could be prominent businessmen, banks, or any other organizations. They could also be HNI’s (High Net-Worth Individuals). Besides the traditional ways of raising money, we will give you an insight on a way you may have heard of before but were not sure of what it was: Crowdfunding. Crowdfunding or collecting funds and starting our very own business is what each startup today aims to do. 

Crowdfunding is a process of collecting funds or investments from many people. Many people invest in unique and practical ideas and solutions and fund the project. You can also consult crowdfunding consulting services to get a better insight.    


The four different types of crowdfunding are as follows:

Donation: As the name suggests, donation-based crowdfunding is when the donors receive nothing in return for their investing money. It usually occurs to support someone, some unique idea, or an invention. 

Debt: This funding type includes business initiators taking the investment in the form of a loan, and it must be paid within a specific deadline and along with interest. It’s one of the most complex ways to raise money. 

Rewards: Reward-based crowd funding allows the donors to receive rewards or incentives in return for their donations. It could be a product, discount, or any other related service. This reward will depend on the type of investment and amount.

The majority of crowd funding occurs online. You don’t have to visit various places and set meetings with different people. As many people will invest, you won’t be able to meet everyone. Hence, you will take help from some of the online crowdfunding websites. 

Below are some of the best crowdfunding websites: 

  • LendingClub: It is a debt-based crowd funding website that offers loans from USD 40,000 to USD 500,000. However, you may have to fulfil certain requirements before acquiring the loan.  
  • Kickstarter: Kickstarter is a reward-based crowdfunding company considered one of the best. It has been providing crowdfunding services since 2009.
  • GoFundMe: This is a charity-based funding website and prioritizes the projects related to charity and non-profit or organizations. There are a lot of examples of successful Crowd funding campaigns. It has proved to be very helpful as initial funding for startups, inventors, charities, or filmmakers. However, it is not as easy as it seems, and you have to work hard and remove a lot of hurdles. 

Partner with organizations offering crowd funding consulting services to gain critical insights and find the platform for facilitating crowdfunding. 

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