Crowdfunding, in simple terms, is a way of collective investment: people invest their money in business projects. The main difference from crowdfunding, a similar tool, is that investors receive a share in the business and part of its profits.
This format of financing is especially important for small businesses. Some banks are reluctant to give loans to small companies or offer less attractive rates, and venture funds are mainly interested in large projects.
For investors, this is a chance to invest in promising ideas at an early stage and potentially get a good return.
Here is a selection of the most popular crowdfunding platforms in Europe and the world:
- Kickstarter is an American platform for attracting investments, operating since 2009. All projects undergo expert review, and if the collection does not reach the goal within the specified time frame, the funds are returned to investors.
- Indiegogo – allows authors to choose between fixed and flexible financing. Campaigns can last up to 60 days, and you can raise an unlimited amount of money.
- Experiment is a platform that helps attract funding for scientific projects and technological developments.
- CrowdFunder specializes in selling shares of accredited companies.
- Start Engine selects promising startups with a minimum investment of half a million dollars.
- Crowdcube is the largest investment platform in the UK, focused on supporting young entrepreneurs. You can invest starting from 10 euros.
Crowdinvesting is a promising tool for both investors and small businesses. If you carefully select projects and distribute investments between different businesses, you can increase the chances of successful investment.