How Crowdfunding Assists Startups

If you are not familiar to the concept, Crowdfunding is an alternative way to raise funds from a big number of men and women via the internet. Almost all you need to do is make a campaign and upload it on a crowdfunding website and make it viral with the aid of social media. People who genuinely care about your project and finds interest in the same will make contributions to it. In come back, they are going to get a prize or equity as the case may be. Because there are many types of crowdfunding, two of them which fit best for startup companies are: 1. Reward based Crowdfunding - Under this type of crowdfunding, the backer gets an incentive in return for his contribution. This reward could be a handwritten thank-you note or the early on bird personalized product itself. It depicts the gratitude of the project owner towards the backer, these are those techniques that money can't buy and gives a special feeling to the backer. 2. Equity-based Crowdfunding - Here, people who contribute to your campaign would receive equity/shares of the company in return. With this unconventional technique of raising cash, the financial woes of entrepreneurs are lowering. They now do not have to knock the doorway of investors, pitching and convincing them till the end. You do not need to be frantic and giving presentations to numerous people. All you need to do is present your business well online.

Crowdfunding permits the business owners to pitch their idea to a broader audience rather than just specific investors. With social mass media prevailing so much nowadays, it is a lot better to find like-minded visitors to contribute to your project. Anyone can contribute to your idea; you just have to make certain that individuals know about your project. Thus if you have an idea that is stuck for financing, get prepared to make it live! Get Crowdfunded!

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