Crowdfunding Your Way to the Top

Crowdfunding Your Way to the Top

Crowdfunding is asking a crowd of people to donate a defined amount of money for a specific cause or project in exchange for various rewards. There are three general categories crowdfunding can fall under: Equity, Donation, and Debt.

Equity-based crowdfunding is asking a crowd to donate to your business or project in exchange for equity.

Donation-based crowdfunding is asking a crowd to donate to your project in exchange for tangible, non-monetary rewards such as an ecard, t-shirt, pre-released CD, or the finished product. Debt-based crowdfunding is asking a crowd to donate to your business or business project in exchange for financial return and/or interest at a future date.

Benefits:

  • Crowdfunding is useful for a variety of opportunities, whether fundraising for disaster-relief, creative projects, creating a salable product, or creating a startup.
  • Crowdfunding platforms allow you to market your project, generate interest, and receive funds.
  • Crowdfunding backers can provide useful feedback about your project.
  • Once you get a solid base of support, there is no limit to the amount of projects you can fund.

Risks:

  • Exposes your ideas to potential copycats and fraud.
  • Platforms may limit the amount of funds you can receive.
  • Regulations and taxation can be difficult to work with.

About the Author

Lisé Markham Lisé Markham
For Lisé, our founder, startups and turnarounds are her life. Fueled Consults originated from an urgent need for resource vetting in all levels of business.
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