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What is Crowdfunding?


Crowdfunding is a way for individuals and projects to get funding. It can be used for any number of things, from raising money for a film or paying off your student loan to starting your own business.

The idea behind crowdfunding is that you ask others for money in exchange for some sort of reward or gift. That's why we're here today—to learn all about crowdfunding!

What is Crowdfunding?

Crowdfunding is a way for individuals and projects to get funding. It is a way to raise money for a project or venture by soliciting small amounts of money from a large number of people.

Crowdfunding involves using the Web to collect many small donations from people who are interested in your venture. Since it's relatively easy for anyone with an Internet connection to set up a website and ask for contributions, crowdfunding has become popular among artists, inventors, writers, musicians, filmmakers and other creatives. It’s often used by those who want financial support so they can create their art without having to seek funds from traditional sources like record labels or movie studios.

In some cases, these artists will even give away their work through the site itself. For example, Kickstarter famously allowed Amanda Palmer's fans to purchase her album directly from her website rather than waiting until after it was released all at once through stores like Amazon Music Store or iTunes Music Store.

How Does Crowdfunding Work?

As mentioned, crowdfunding is a way to raise money for projects and ventures. The concept is simple: you let people know about your idea, and if they like it, they'll donate money to help make it happen. There are many different types of crowdfunding platforms out there—some are specific to certain industries, while others are generalist in nature—and each has its own requirements and regulations.

Advantages to Crowdfunding

Here are some of the main advantages of crowdfunding;

You don’t have to give up equity

In traditional financing, you might have to give up a share of the business. With crowdfunding, you can keep your business all to yourself! (Unless it's a rewards-based or equity crowdfunding project.)

You can raise money for almost anything

You don't need an existing product or service—you just need an idea and a pitch that people want to invest in. That could be an invention, a mural series you want to paint on buildings around town, or something as simple as buying your favorite sports team new uniforms (and then donating them). The sky's the limit!

You can build a community

You can build a community of backers who are interested in what you're doing and want to stay involved with your project long after they've given money toward its completion. This means they'll be more likely to support future projects too! And that's always good news for any entrepreneur looking for investors.

A Step-by-Step Guide to Crowdfunding

A crowdfunding campaign is a big undertaking, and it's easy to get overwhelmed. But with the right prep work and planning in place, you can launch your project with confidence and make sure it sets the tone for its success.

Here's what you need to know about each step of the crowdfunding process:

  • Choose Your Platform

  • Write a Great Project Description

  • Make an Awesome Video Pitch

  • Promote Your Campaign

  • Keep Your Backers Informed With Regular Updates & Other Tips For Success

The best crowdfunding campaigns are those that give backers an inside look at the process of creating a product. You don't have to share every little detail with them, but it's helpful if you can give them something to look forward to in the form of regular updates. These updates can be as simple as letting people know how much progress has been made on their rewards or how close they are to reaching their goals.


Crowdfunding is a great way to get your project off the ground. It’s a great way to connect with your fans, build credibility and create buzz around your product or service.

If you want to learn more about crowdfunding and the platforms that can be used, check out our article on Indiegogo vs Kickstarter. So, are you going to give crowdfunding a go?

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