Learn How Crowdfunding Works


For many startups, finding seed capital is becoming very difficult, especially if you are looking to go the traditional route.

This is why many entrepreneurs have started going the crowdfunding route to raise the capital needed.

This article will take a closer look at crowdfunding; what it is and some of the top crowdfunding platforms available to the public.

Check out the rivalry between the two behomoths of the crowdfunding arena:  Indiegogo vs Kickstarter.

Are you curious, or wondering what does crowdfunding mean?

A simple way to describe crowdfunding is as a collective effort by individuals to pool their resources in order to support an organization or an individual. In this day and age, this is typically done on the internet.

Some example of how crowdfunding has been used to help people and organizations reach their goals:

Other areas of crowdfunding are not so typical, these include movie and software development, artist support, and startup companies.

In 2011 one study showed that nearly $1.5 billion was raised for individuals and companies.

Now, five years later one capitalist is saying that he predicts crowdfunding efforts will bring in over $300 billion.

Much of the funding comes from friends and family members of young entrepreneurs trying to help them in any way they can.

To get started the entrepreneur must:

  1. set up a monetary goal and a time frame to reach that goal,
  2. donations will only be taken out of investors bank accounts once the goal is reach.
  3. If the goal is not reached nothing will happen, if it is money will be deducted from the investors bank account and the crowdfunding platform will take a small cut.

First we will look at Kickstarter, this is said to be the oldest and the strongest crowdfunding platform.

You can fund or get funding for a variety of different projects including games, films, design, art, music and technology.

Kickstarter is full of innovative, imaginative, and ambitious projects that can be brought to life through the support of others.

Indiegogo is another crowdfunding website that is one of the earliest and oldest platforms in the world.

This site allow has helped raise a lot of money for campaigns in nearly every countries.

The company was funded by three entrepreneurs that had similar experiences of having a great ideas but struggled to find funding via traditional channels.

Eric, Slava and Danae (pictured below) were each passionate, hard working and had strong networks; they were able to come together and solve their problem and the problem for many people around the world.

The founders of Indiegogo.


Indiegogo was born to be a crowdfunding solution that enables people to donate to great projects, easily.

We are just scratching the surface of the world of crowdfunding in our first post, while we prepare more on the how-tos of crowdfunding, you can check out this post on how http://www.ehow.com/how_6927971_succeed-crowdfunding-really-trying.html for further details.