Crowdfunding

IDEAS check
IDEOLOGIES check
STRATEGY check
PEOPLE check
MONEY no?
Should this be a setback? Does this confine efforts?

Nah! For those who have always nurtured an idea but could never live the dream due to financial restrictions, crowdfunding is one of the dynamic ways to bring forth the action. Crowdfunding, an innovative form of alternative finance, means bringing together a group of people who are interested/believe in your idea and help you raise capital by individually funding small sums of money, through Internet.
It is being experimented as a funding mechanism for creative work such as blogging, journalism, music, independent film and for funding start-up companies as well.

Start-up space in India is bigger than ever. And everyone doesn’t not come from money, so crowd-funding, with still being in its nascent age, has offered hope to an increasing number of start-ups.

Why would you crowd-fund?
A. You might not be filthy rich
B. To build up relations
C. To expand your business idea to masses
D. Nothing is better than mind-blowing free publicity (even before your enterprise has started!)

This is not just limited to business ideas, but extends well up to film industry, festivities, temples and mosques which are built up on public’s money. Crowd-funding is a concept in its baby stage but it’s immensely popular in America and Europe with successful crowdfunding campaigns like Crowdfunder, Kickstarter, Indiegogo on the go.

There could be three types of crowdfunding:
1. Accept donations for projects but give back returns involving finished goods to the donors (DONATION/REWARD BASED CROWDFUNDING).
2. Take/ collect money from donors to facilitate money loans or micro-finance the needy (LENDING BASED CROWDFUNDING).
3. Donors also take a share of equity in the project or start-up. Not legal in India though!(EQUITY BASED CROWDFUNDING).

Let’s look at crowdfunding from another point of view. This time, you have been approached by a start-up company for small funds. Would you simply give away your money to a bunch of strangers?
90% chances are you’ll not give a damn!

Crowdfunding is in its baby stage in the sense that
1. A company has little to offer as incentives to you.
2. You might be convinced by using sweet promises, but who can guarantee the integrity of the company?
3. The company fails to deliver what it promised (whatsoever reason).
4. Company uses your funds for personal benefits (for eg. A much needed vacation!)
5. Company fails to provide funding details.

All in all, the concept is still new but it surely will become common in India within a few years !

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