It is arguable that nothing has shaken up the investment and funding world lately more than crowdfunding. If you’ve never heard the term, you’re not alone, but crowdfunding is making waves by helping entrepreneurs, artists, inventors and startups find funding for their ventures without using traditional investment channels such as venture capital, angel investment or bank of mom and dad while in the early stage growth phase.
In fact crowdfunding is so disruptive that Obama recently signed the JOBS act (here’s a break down at Mashable).
Right now may be a great time to get your product development, prototype or other startup expenses covered via crowdfunding.
Below is a list of some of the top crowdfunding sites. They’re all different and seem to target a different type of entrepreneur, some are for creatives looking to launch a music career, others are for inventors with a product idea.
As always, read the fine print when signing on the dotted line with any of the following sites or other crowdfunding sites. We recommend going with a reputable site with a history and success stories. Good luck!
Kickstarter For entrepreneurs, innovators, artists and the like. If you need funding for you project, Kickstarter is a great place to watch, learn and participate. With a lot of successful projects, there are some great examples on how to inspire a community to support your vision. Also, don’t be afraid to reach out and contact folks who have posted on Kickstarter, they are often more than willing to offer advice and help.The fees are in the fine print 5% + transaction fees, but basically, you must reach your set goal to get funded.
An example of kickstarter success on Designboom.com
Indiegogo The platform is as simple as Kickstarter. As they say on their site “Create Your Campaign” “Gain global exposure” and “Get Inspired”. The fees vary from 4% to 9% based on the success of your project and a few variables like credit card processing fees. Indiegogo also coins itself as the worlds largest global funding platform.
Interesting factoid – the movie “Bully” received some funding from a campaign on Indiegogo
Other projects of indiegogo.com fame? How about the Luminaid
Rockethub “RocketHub is a launchpad and community for independent artists and entrepreneurs” as it states on their site.
Two notable advantages of Rockethub – Internationally based and they accept money from around the world.
“Extra Credits” set a goal to raise $15,000 through Rockethub.com and has already raised $103,814.
Crowdtilt has a slightly different model called group funding. Watch the video on the homepage for a very quick and simple description. Crowdtilt is focused less on the Entrepreneur / selling an idea and more focused on managing money collected for anything like group funded birthday gifts. Where crowdtilt may be advantageous is for those individuals that have a strong and large social network group. Don’t count Crowdtilt out for your entrepreneurial product ideas, just be aware that it appears to cater more to smaller one off funding purposes than a fundraising tool with incentives for contributors. Crowdtilt was birthed from the Ycombinator incubator and is quickly picking up steam.
Have your own experience with crowdfunding? We’d love to hear about it! Leave a comment.
The Patents and Prototypes Team