Why Crowdfunding?
Mar 18, 2022
It’s more efficient than traditional fundraising.
When you’re an early-stage company focused on building your business and attracting seed capital, you might not be able to afford all the time and attention that pursuing traditional financing demands. Compared to applying for a loan or seeking out accredited investors yourself, setting up a successful crowdfunding campaign on E-Collecta is far more efficient and effective in getting your message out to the right people. With the right platform, you can tell your business’s story, produce a quick video, set up some enticing rewards, and benefit from having everything in one centralized location where potential backers can find you.
Easier than traditional methods
Until recently, the more traditional ways to raise money for your startup included applying for a bank loan or pitching angel investors and venture capitalists for an investment. Although these funding sources are still alive and doing well , they are more difficult to tap than the investors you can reach through a crowdfunding campaign. Banks are difficult because they want to sure that they money they loan you is going to get paid back with interest. So banks are not really going to take a risk on a new business idea that doesn’t have a history of sales and profits. Angel investors and venture capitalists on the other hand expect that many of their investments will fail, but in return are looking for a big score. So if you can’t demonstrate how your idea is going to be a big business in the next few years, it’s unlikely they will be interested in funding your project.
It doubles as marketing and media exposure.
Press coverage will create more eyes on your campaign and create lasting brand awareness for your startup. This can come in the form of a feature story on a popular news station, blog, or print publication, and is a great way to bring in backers outside of your personal network. A good feature story or Twitter mention can create a powerful snowball effect, putting you in touch with major investors you might not have otherwise reached. Whether they read about your new product on a popular blog or hear about your innovative campaign from a friend, a successful crowdfund is a great way to capture new investor interest.
It is free!
If the fundraising project is successful, everyone wins and gets to be a part of a successful crowdfunding project. When successful, the average commission for the platforms is around 5% of total funds raised.
When you’re an early-stage company focused on building your business and attracting seed capital, you might not be able to afford all the time and attention that pursuing traditional financing demands. Compared to applying for a loan or seeking out accredited investors yourself, setting up a successful crowdfunding campaign on E-Collecta is far more efficient and effective in getting your message out to the right people. With the right platform, you can tell your business’s story, produce a quick video, set up some enticing rewards, and benefit from having everything in one centralized location where potential backers can find you.
Easier than traditional methods
Until recently, the more traditional ways to raise money for your startup included applying for a bank loan or pitching angel investors and venture capitalists for an investment. Although these funding sources are still alive and doing well , they are more difficult to tap than the investors you can reach through a crowdfunding campaign. Banks are difficult because they want to sure that they money they loan you is going to get paid back with interest. So banks are not really going to take a risk on a new business idea that doesn’t have a history of sales and profits. Angel investors and venture capitalists on the other hand expect that many of their investments will fail, but in return are looking for a big score. So if you can’t demonstrate how your idea is going to be a big business in the next few years, it’s unlikely they will be interested in funding your project.
It doubles as marketing and media exposure.
Press coverage will create more eyes on your campaign and create lasting brand awareness for your startup. This can come in the form of a feature story on a popular news station, blog, or print publication, and is a great way to bring in backers outside of your personal network. A good feature story or Twitter mention can create a powerful snowball effect, putting you in touch with major investors you might not have otherwise reached. Whether they read about your new product on a popular blog or hear about your innovative campaign from a friend, a successful crowdfund is a great way to capture new investor interest.
It is free!
If the fundraising project is successful, everyone wins and gets to be a part of a successful crowdfunding project. When successful, the average commission for the platforms is around 5% of total funds raised.