“Success is best when shared”- Aptly quoted by Howard Schultz (President, Starbucks). We often hear people thanking someone else for their success, be it their parents, mentors, or spouse. Have you ever heard of someone who thanks the crowd for their success?
When thinking of starting your own business, the first thing that comes to mind is financing. Personal savings, loans from friends, family, and bank loans are the most popular ways to finance a business start-up, and with a detailed business plan, an entrepreneur could seek financing from venture capital firms or investors. angels. With the change of era and technology, we now have an alternative source of financing available for startups, which is Crowdfunding.
For those who are not familiar with the concept, Crowdfunding is an alternative way to raise funds from a large number of people through the Internet. All you need to do is prepare a campaign and upload it to a crowdfunding website and make it viral with the help of social media. People who really care about your project and find an interest in it will contribute to it. In exchange, they will obtain a reward or equity as the case may be.
As there are several types of crowdfunding, two of the ones that are best suited to startups are:
1. Reward-Based Crowdfunding: In this type of crowdfunding, the backer gets a reward in exchange for their contribution. This reward could be a handwritten thank you note or the personalized early riser product itself. It represents the gratitude of the project owner towards the sponsor, these are those things that money cannot buy and they give a special feeling to the sponsor.
2. Stock Based Crowdfunding – Here, the people who contribute to your campaign would receive shares/shares of the company in return.
With this unconventional fundraising technique, entrepreneurs’ financial problems are diminishing. Now they don’t have to knock on investors’ doors, introducing them and convincing them until the end. You don’t need to be frantic and give presentations to numerous people. All you need to do is present your business well online.
Crowdfunding allows entrepreneurs to pitch their idea to a broader audience rather than just specific investors. With social media being so prevalent nowadays, it’s much easier to find like-minded people to contribute to your project. Anyone can contribute to your idea; you just have to make sure that people know about your project.
So if you have an idea that is blocked for funding, get ready to make it a reality! Get crowdfunded!