Let’s start with an Intro to Crowdfunding 101:
As crowdfunding gains in popularity you’ve probably heard of Kickstarter, Indiegogo, GoFundMe, Milk Money Vermont and maybe even Kiva. Let’s look a little closer at what makes these all so different:
- Rewards Based Crowdfunding is what you see on Kickstarter, Indiegogo or even iFundwomen: in exchange for financial support, people are either given some type of a reward (pre-orders, services, recognition/swag) or in some cases they can offer their contribution as a donation.
- Donation Based Crowdfunding is what you’d see on a GoFundMe: allowing people to raise money for special events or challenging circumstances such as illness or accidents.
- Equity or Investment Crowdfunding is what you see on Milk Money Vermont or a national crowdfunding site like WeFunder: these platforms enable investors to fund startup companies and small businesses in return for some form of equity. Investors are giving their money to a business and receive ownership of a small piece of that business.
- Debt crowdfunding is what you would see on Kiva: a debt crowdfunding platform that allows people to lend money to entrepreneurs and students in underserved communities who might not have access to capital.
Come back soon to learn about fellow Vermonters with Donation and Rewards based campaigns!