Have you ever wondered how small businesses gather the capital for starting their business? It is often with the help of the best crowdfunding platforms. Let us dig deeper to know more about it.
Maximum businesses raise funds for their commencement. The proprietors go to the investors and detail them about the business ideas. The investors who think that the idea is worth investing in contribute their funds to the business. The businesses, in return, give them shares in profit.
But in this process, there are chances that the investors do not like the idea. And the businesses have no choice but to rely on a handful of investors. If the businesses share their idea socially with a large number of people, there may be a few who are interested in the business idea.
This is actually the concept behind crowdfunding. Let us break the word down to understand better. Reaching out to the crowd (that is, a large mass of people) to get funding (capital or investment for business) is called crowdfunding. Here the people share their business ideas with a large group of people. Those people may contribute a small amount of money that is clubbed together into huge investments. Let us study the best platforms for businesses in detail in this blog.
Crowdfunding is a method to raise capital through the internet by using social media platforms and crowdfunding platforms. The accumulated funds that are gathered from every small investment of the people contribute to start-up capital. The fundraisers get the equity shares of the company as a reward for their investment. Only in donation apps for crowdfunding, there is no return on investment.
It is pretty clear from the above explanation what crowdfunding actually is. Now let us look into its working.
Crowdfunding focuses on three major parts:
To succeed in the crowdfunding campaign, you need three aspects:
To ensure easy and secured payments in multiple currencies, it is important to have a secured payment platform. Although, the worldwide accepted currency for crowdfunding is USD, still there must be an option to configure the relevancy of the crowdfunding software with other currencies. Be of the opinion to add other common currencies like Yuan, Yen, Rupees, Euros, Australian Dollars, Singapore Dollars, Canadian dollars, Pounds, etc.
The more currencies you will integrate into your payment gateway, the more will it have a social outreach.
There are many crowdfunding applications available on the internet these days. Most of them are flexible and can be customized according to the user. The more user-friendly the application is, the more it will be used. A clean design and quick signup contribute to making an application user-friendly.
A progress meter is important to keep track of the campaign progress. A visual representation can be a really powerful tool to show the campaign’s progress. People find it interesting to complete the tasks.
Social Networking is important to expand the outreach of the application. As the name suggests, crowdfunding applications are useless without a crowd. Getting the crowd is not a difficult task, but getting the right crowd who would show interest in your business, is a real challenge.
These platforms support startups, non-profit causes, and other personal needs by engaging the community. Let us take a look at a few best platforms.
The most famous name in the crowdfunding industry is Kickstarter. It has supported various innovative ideas since 2009. Kickstarter has funded more than 156,000 projects, including games, movies, products, etc.
You can create a free campaign on Kickstarter. You can begin by setting your goals and timeframe. After 14 days, you will get your amount. However, you have to pay platform fees and third-party processing charges. Kickstarter is an all-or-nothing platform. It means you either get the funding you set in the campaign or lose everything on falling short.
Kickstarter enables you to offer rewards to your backers. Backers are people who invest in your idea. You can provide them with an incentive-based gift system, where the more money they pledge, the better reward gets unlocked.
The app connects you with like-minded people. You can save your favorites, get reminders, and stay updated about your backed projects. You can pitch your campaign only if it gets approved.
|Platform Fees||5% plus 3% – 5% processing fees|
|Ratings||4.1 Android / 4.8 iOS|
GoFundMe is an online crowdfunding and fundraising platform that enables you to collect donations for your cause. It has no platform fees but a small percentage of transactional charges and 30 cents per donation. People have raised more than $5 billion for personal or business purposes.
You can keep whatever amount you raise, be it higher or lower than the goal. Because it allows donations, people usually provide charity to trusted or close sources. It makes money-raising through the platform a little challenging. It is better for emergency or medical service causes.
|Platform Fees||Free (2.9% processing fees and $0.30 for every donation)|
|Ratings||4 Android / 4.5 iOS|
|Downloads||1 Million +|
Patreon is a unique crowdfunding platform that explicitly targets artists, musicians, podcasts, bloggers, and creators. Instead of crowdfunding, it works on subscriptions. It eliminates the need to create limited-time campaigns. Rather, it focuses on building a loyal base and getting recurring revenue through paid memberships.
Regular creators can benefit significantly as subscribers can cancel anytime. Creators can keep them engaged by offering behind-the-scenes or exclusive content.
|Platform Fees||Three-tier model 5% (lite), 8% (Pro), 12% (premium) on monthly earned income plus processing fees|
|Ratings||4.4 Android / 4.7 iOS|
|Downloads||5 Million +|
If you have a Shopify store and need crowdfunding for a new product through your website, the Crowdfunder Shopify app is a perfect fit. You can set money or quantity goals to raise and check the progress on the crowdfunding page itself. Also, customization and changes can occur after goal-setting.
You can use the platform in three ways:
|Platform Fees||$29 monthly (without Shopify subscription)|
|Ratings||4.9 in Shopify App Store|
|Funded Store owners||2330|
With Wefunder, you can raise investment from $50,000 to $50 million. You can be a brewery, restaurant, tech startup, or fashion business. More than 150,000 investors are available on the app.
You can create a free account and start raising money within fifteen minutes. It can take anywhere between one to three months to accomplish your goal for the venture. There are no management or transaction fees. Administrative costs cover the operational expenses of Wefunder.
The minimum investment size is $100. The app connects young aspirants to qualified and experienced professionals to benefit from their wisdom.
|Platform Fees||Only administrative charges (no processing or transactional fees)|
|Ratings||3.3 in both iOS and Android|
Fundly is an online platform enabling users to raise money for a cause. It has supported around 30,000+ non-profit and volunteer organizations. Moreover, it allows startups, politicians, sports teams, trips, etc., to raise money.
The application enables fundraisers to manage campaigns, post pictures, check to-do lists, synchronize movements in real-time with webpage, etc. Managers can send personalized messages, emails, appreciation notes, appeal letters, etc., to the donors.
You do not need to reach the goal to keep the money. Withdrawal or transfer arrangements are possible within 48 hours.
|Platform Fees||4.9% plus 2.9% credit card processing fees and $0.30 per transaction|
|Ratings||3.8 in iOS|
Indiegogo provides a unique platform for startups, artists, and non-profit organizations to raise funds. It allows you two options: either an all-or-nothing fixed funding goal like Kickstarter or flexible funding to receive whatever you get.
Indiegogo’s equity crowdfunding in the US enables startups to attract potential investors. Nearly 1.5 million people have benefitted up to the US $2.5 million for their projects. Indiegogo in-demand lets you raise money even after the campaign ends.
It has both live crowdfunding campaigns and a marketplace for your innovative products. An additional advantage is that you get word-of-mouth benefits as people that follow you spread the word around.
|Funded||800,000 + creative ideas|
Crowdsupply is a platform that aims at bringing useful, original, and respectful hardware to life. At the time of software firms peaking, Crowdsupply touches the hardware and electronics market. It has successfully helped launch 80% of the projects with an average of $61,000 funding.
The platform empowers product creators to come to the forefront and launch their products. It follows an all-or-nothing model, meaning if you don’t receive the total amount, you won’t get a penny, and the money won’t get debited from backers’ accounts.
Crowdsupply receives your submission form describing the project. It secures both backers’ and product creators’ rights.
|Platform Fees||5% Standard plan without processing fees (6-15% for custom plans)|
|Total Funding Amount||$1.5 Million|
Crowdfunder is an equity crowdfunding platform. It helps raise capital through a crowd of accredited investors. It connects you with 12000 venture capitalists and angel connectors to attract and pitch.
You do not need to pay a platform fee. Instead, there are monthly plans suitable to your needs. It is ideal for startups who have received validation to an extent and are on a roll to grow. Startup owners can create deals for equity, debt, convertible note, or revenue share.
It is not a reward-based model and provides investors and entrepreneurs with a more formal approach towards funding.
|Platform Fees||Plans begin at $299 monthly. You get to create a public profile and a ‘deal room’ for investors. It also allows you to establish a non-public profile and a free deal room.|
|Total Funded Amount||$5 Million|
Chuffed supports social cause organizations that help animals, the community, or the environment. They have successfully raised an average of $7000 for non-profit and cause-based organizations. They have organized nearly 8000 campaigns and collected $18 million.
Chuffed allows users to pay platform fees only if they had a good experience. Otherwise, they can keep the total amount. It enables you to launch a campaign for any social cause- education, health, social welfare, environment, international development, etc. It also includes peer-to-peer fundraising to set up an event, create a fundraising page, accept donations globally, and integrate with social media platforms for a boost.
|Platform Fees||Optional payment for processing fees. Donations to Chuffed are encouraged.|
|Fund||$1 Million +|
The changing times reflect the need to develop accordingly. The platforms address the significant needs of raising finances with a global reach. Idea Usher is a mobile app development solutions provider with a highly proficient team, helping you build the app of your vision.
Developing such an application can be a challenging task. Various security, privacy, and other measures are a must for the protection of all parties. Idea Usher ensures compliance with the regulations. It provides suitable solutions based on your needs and budget.
An application enriched with the necessary features can enhance the user experience. Idea Usher follows a specific procedure and plans for optimal client results.
Popular crowdfunding sites are the need of the hour. These sites enable people to solve their or others’ financial problems and connect with people worldwide. Startups, investors, product launches, social causes, and other issues get adequate attention through adequate funding.
Global connections enable creators, artists, musicians, business people, non-profit organizations, etc., to spread their message. Similarly, investors and donors get a reliable platform to work their differences. Idea Usher helps you in creating your own crowdfunding application with unique features, price plans, and user interfaces.
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Crowdfunding application development costs depend upon the technicalities that are to be included in the app. It varies with customizations and features that are added to the app.
Crowdfunding applications usually take up from 45 days to 90 days, depending upon the features.
While developing a crowdfunding platform, you must consider the following factors:
You can develop a crowdfunding application of the following type:
Earning revenue through a crowdfunding platform is possible through the following models:
Idea Usher is a pioneering IT company with a definite set of services and solutions. We aim at providing impeccable services to our clients and establishing a reliable relationship.