It’s time again for Start-Up funding for another company. Like before, I need to raise capital to get the business launched and this is not the best time to raise capital, or is it?
There’s a new process perfect for Start-Up funding that has evolved from Social Lending called Crowdfunding. It essentially lets anyone give to your start-up company in any amount that they choose to give.
Crowdfunding is a contribution to you with no expectation of anything in return. That means that the entrepreneur keeps 100% equity in the business and has no need to pay the money back because they are not borrowing the money.
I’m looking forward to trying this strategy out and seeing how well it does. Other entrepreneurs acquired between $1,000 to $200,000 and more and in an extremely short period.
Many online sites have come into existence to support Crowdfunding. The first sites were focused on helping artistic projects, but as more sites came online, they began to accept for profit entrepreneurial businesses.
Some of the Crowdfunding sites require that the goal amount is raised in the allotted time frame or the entrepreneur will not receive any funding. Other sites start the funding the moment someone makes a contribution.
They all take a transaction and processing fees. You should expect as much as 10% of what you raise will go to the Crowdfunding site.
If you get more donations than you asked for, you’ll get more funds which are an added bonus, and many of the fully funded projects and start-up companies end up with more money than they originally asked for.
To get started, just pick a source. I’ve included a link to a great diagram that explains the process further. Create your profile, but take your time before making it publicly available. You want to have your best possible presentation available.