You might have seen the term crowdfunding and how it is used to raise money for different causes specifically soliciting donations and charity. But have you ever thought about using a crowdfunding campaign to fund your dream business?
Not a lot of people are open to the idea of using crowdfunding as a way to generate your capital for your startup. Some people find it difficult to ask for funds from family, friends or complete strangers based on ‘how it might look’ or they feel like it is ‘begging’.
That mindset has to change. More people are starting to use this concept to startup their business and changing it from a dream, to reality. In fact, crowdfunding is not 100% about money. There are several advantages you can get through this method.
Do you know that by running a crowdfunding project, you will get exclusive marketing for your startup? Giving others the opportunity to fund your business idea, will increase the amount of exposure for your business even before it begins.
Think about it. The people who donate could possibly be potential clients, and loyal fans.
After all, you only invest your money for something that will benefit you in return, right?
Whoever supports your crowdfunding campaign has definitely seen the need for your business in the current moment. In fact, they are so eager and interested that they are willing to take part and be a part of your business journey.
As of 2015, there are more than 30 crowdfunding websites online. Some of them cater only to business needs, some for personal and charity purposes, while others cater to all causes. Below are our top three crowdfunding websites that could benefit you on your start to fund your business.
Why did we pick between these three? Each website:
- have brand recognition and have an excellent marketing strategy
- draws a lot of traffic from search engines, social media and the press
- have gained the trust from the public through the years
This website has raised over $470 million in 2014 alone! GoFundMe is one of the few which allows crowdfunding for personal, business, and charity purposes. Its marketing formula includes sharing your crowdfunding campaign through social media. However, keep in mind that as they charge a processing fee of 2.9% and an additional of $0.30. (see the latest GoFundMe pricing for your country )
Kickstarter only allows funding for businesses and does not cater to any personal use. This crowdfunding website is much more tailored for the use of those who have a creative idea or product concept who want to make a breakthrough in the market.
In 2014, they have collected over $400 million for startups. Imagine how many businesses opened its doors just from the help of Kickstarter. However, do take note of the applicable fees. At 3% to 5% charged, Kickstarter’s processing fees are slightly higher compared to GoFundMe. (see the latest Kickstarter pricing for your country)
Setting up your own crowdfunding campaign through Indiegogo does not cost you a thing. However, the fees are charged later on after your campaign ends. The total fee is charged at 9% whereby 5% of it will be returned to you if your target amount is met. Apart from that, there will also be a processing fee charged at 3%. (see the latest indiegogo pricing )
With that information on crowdfunding, you can no longer use the excuse of not having enough capital for your business startup. Crowdfunding campaigns allows you to gather up enough capital, create a huge fan base of people who are genuinely interested in what you have to offer, and you will allow you to promote your venture for free.You have no more excuses, startup your business today!