What is Crowdfunding?
Crowdfunding is the practice of raising modest amounts of funds from a large number of people to fund a new business initiative. Crowdfunding takes advantage of the widespread availability of vast networks of people via social media and crowdfunding platforms in order to bring entrepreneurs and investors together, with the potential to boost entrepreneurship by broadening the pool of investors beyond the typical circle of owners, relatives, and venture capitalists. The money gathered through crowdfunding is often used to fund a specific project, make general donations, or rally support for a time-limited initiative.
Geeky Takeaways:
- Crowdfunding allows businesses and individuals to raise funds from a large number of investors, who can choose among hundreds of projects for as little as ₹100.
- There are restrictions on who can fund a new firm and how much they can donate.
- Crowdfunding sites profit from a percentage of the funds raised.
- The SEC oversees equity-based crowdfunding operations in the United States.
- Kickstarter, Indiegogo, and GoFundMe are some of the most popular crowdfunding platforms.
Table of Content
- How Does Crowdfunding Work?
- Types of Crowdfunding
- Advantages of Crowdfunding
- Disadvantages of Crowdfunding
- Examples of Crowdfunding
- Popular Crowdfunding Websites
- Frequently Asked Questions (FAQs)
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