Three Crowd-Funding Websites For Businesses To Raise Money

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Crowd-funding is a method of funding projects through popular support. Its success as a fund-raising method hinges on public interest in the project. If there is a large number of interested individuals (called "backers"), each can make a small contribution (or pledge repeating contributions) which can then add up to a significant chunk of capital. Crowd-funding is starting to become the preferred way of raising money and far more lucrative than traditional bank loans or investor financing. In this blog post, we will review three leading crowd-funding websites that can help you raise money for your next project.

Kickstarter

Kickstarter is a well-known crowd-funding platform sporting a huge active online community. Its platform has collected billions of dollars from backers and has helped support more than 100,000 projects.

The Kickstarter platform supports backer perks or "rewards" that allow projects to entice donors with favors or items. Backer rewards come in tiers. For example, a backer could donate $5 and receive a small gift, donate $20 and receive something more substantial, or donate $100 and get something permanent (the backer's name on the project, for example). If you decide to offer rewards, make sure you are ready to fulfill them!

Success with a Kickstarter crowd-funding campaign hinges on reaching a predetermined goal. If the project does not reach its goal dollar amount in donation pledges, the donations will not be fulfilled. For that reason, it is important to choose a realistic goal when launching a Kickstarter campaign.

Kickstarter is a great choice for small businesses with strong community support and well-defined goals. If you are certain about your bottom line, or the exact dollar amount of money you need to get started, this can be a great avenue.

Indiegogo

Similar to Kickstarter, Indiegogo supports one-time donation drives and backer rewards. One very important difference with Indiegogo is that it provides more flexibility in case you do not reach your funding goal.

Indiegogo is a great option for a more flexible business with a well-defined business and profit model. Because of its flexibility, you have the power to choose whether to move forward at the end of the campaign. If your goal was met or not, you have the option to accept donations and continue your work.

Timing and publicity are crucial for a successful crowd-funding campaign on Indiegogo. Because donation drives last a limited number of days, you need to choose the best time for your business crowd-funding drive to go live. It can be helpful to build support before starting your campaign, but do so at the risk of being forgotten. Take advantage of momentum and choose the right moment to start fund-raising.

Patreon

Another crowd-funding platform called Patreon allows backers to pledge repeating support for projects. This platform is more appropriate for ongoing projects that require ongoing support. It is a very popular option for artists who need help producing art. Hence the name "Patreon," as in "patron."

Patreon-funded projects are usually not profitable or marginally profitable. The platform provides an avenue for "artists and creators" to establish "sustainable income."

Like Kickstarter and Indiegogo, Patreon campaigns support rewards for backers, called "patrons." These rewards often look different from those on Kickstarter and Indiegogo, as they need to offer repeating benefit to patrons. Patreon provides "patron only" options, which allow projects to offer project involvement perks to patrons.

If your business produces creative content without a strong profit-oriented model, you will probably need ongoing crowd support. In this case, Patreon is the option for you. Get people excited about your business with some previous work and samples on your Patreon page.

If you are passionate about what you do, chances are others are passionate as well. Reach out to members of your community, social circles, and family. Exciting ideas tend to spread, and as they spread more contributors will find you!

A penny for your thoughts!

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