tech-company, crowd-funding, hardwareMy company sells hardware that allows charging of one mobile phone by plugging it into another.
We just launched an Indiegogo campaign, but I’m curious now of what other crowdfunding platforms or sites could we have used. What might have been our options, and what would have been their advantages and disadvantages?
I have listed all of the major crowdfunding platforms with their advantages and disadvantes. Hope you can find the one/ones you are looking for.
Advantages: Huge user base, most popular crowdfunding website. Successful technology and design projects make a lot of money. Dance and music projects have a very high chance of success (74% of dance projects are successful). Allows you to limit the number of pledge packages you offer. Incredible resources for statistics.
Disadvantages: Difficult to get featured on the front page. If your project is the development of a technology, it cannot be a finished product. If you do not completely fund your project, you get no money. You cannot stop funding of your project once you begin (can create logistical issues). Fashion, photography, and publishing perform exceptionally bad.
Advantages: Can claim funds even if your project doesn’t get fully funded (at a higher percentage however). Easier to get featured as there are fewer projects. Still a huge user base (around 10m unique visitors in 2012). One of the lowest percentages taken of final funds of a successful project. Largest insight based blog in the crowdfunding field.
Disadvantages: If you don’t reach your funding goal, they take one of the highest percentages of final funds. If you choose flexible funding and don’t make your goal, you must take the money from your pledges. Can only distribute funds in USD, CAD, Euros, and Pounds. Other currencies may be charged an exchange fee by your bank.
Advantages: Cheapest crowdfunding platform at 2.9% + $0.30 of every transaction. Very altruistic and emotional funding. Every contribution given to your campaign is immediately placed into your bank account.
Disdvantages: Low average project funding (because of the nature of many of the projects). Being emotionally oriented, high-tech project will not perform well here.
Advantages: Second cheapest crowdfunding platform with 3.5% of the final funds raised as well as a monthly fee (starting at $99/month). Depending on what package you select for your monthly fee, they will offer varying level of assistance to your project. Works both in equity and pledge based crowdfunding. Thorough vetting of funding applications.
Disadvantages: Only get funding if your start-up gets fully funded. The monthly fee can add up depending on the length of your campaign. Smaller user-base than many pledge-based crowdfunding platforms. Notes: Technoloy oriented platform, this is a good site if your start-up is based in tech.
Advantages: Traditional funding for small business, larger amounts of money than crowdfunding generally. Takes care of most of the due diligence that a company would usually need to complete. Can define maximum funding, and minimum funding per investor. Free to use the platform until you complete investment.
Disadvantages: Traditional funding for small business, more difficult to get funded. Undefined amount of money is taken at the end of the investment process (sounds like it varies based on amount raised).
Advantages: Traditional funding for start-ups, larger amounts of money than crowdfunding generally. Takes care of most of the due diligence that a company would usually need to complete.
Disadvantages: Takes a 10% finder’s fee, the highest of any crowdfunding platform. Traditional funding for start-ups, more difficult to get funded. After paying the $350 you aren’t guaranteed investment.
Advantages: Takes none of the funds from a loan. Very active user base giving out large loans on average. Highly altruistic base.
Disadvantages: Not for first-world countries. Small total given to businesses. Most of the projects involve giving funding to small businesses that have no access to traditional banking.
Advantages: Heavily product oriented. Can get the shipping information and variations in your product that your pledgers want at the time of the pledge. Excellent support as the project proceeds. Converts your campaign into an eCommerse page once successful, allowing more people to order your product immediately. Exclusive project base, you will get noticed by a visitor to their website.
Disadvantages: Must be a physical product. Smaller user base.
Advantages: Simple to set-up with any WordPress website. You only pay processing fees from your bank. Can run a campaign however long you want to. You can customize everything you want to if you have the programming know-how; if not, the plugin will work fine. Comes with embeddable widgets to allow you to get contributions more easily.
Disadvantages: Don’t have access to the user base of another crowdfunding website. Don’t have any guides to help you through the crowdfunding process. Initial fee of $59 to use the plugin. You have to set-up the plugin yourself (however this is very easy) and do any design changes you want yourself.
Advantages: You define everything yourself, this is truly open source. The only fees you pay are any processing fees that your bank charges you. You can create the website to look any way you want it, allows you to brand at the same time as crowdfunding.
Disadvantages: No user base from other crowdfunding websites, you work entirely from your own lists. You have to build a website, that includes all the backend work, hosting, domain name, etc; this only provides you with the basic code. Incredibly time consuming to set up. Doesn’t include the framework that a lot of crowdfunding sites have to help guide you through the campaign.
Source: This
If your startup is B2B, you can reach lots of sofisticated investors on crowdfinancing sites like startupvalley, fundable.com or if you are based in the UK crowdcube.com, where you offer equity. You can offer discounts on your products for your investors, that will become your firsts beta testers and will guide your development. If your product is B2C, you’ll get better exposure on the sites featured by demirb, just offer your product to your backers and move your campaign on your social networks, just follow your targets. See some useful links:
a complete list: http://en.wikipedia.org/wiki/Comparison_of_crowd_funding_services
http://plantostart.com/10-crowdfunding-websites-entrepreneurs/
If you are targeting the consumer area (sounds like you are), Indiegogo and Kickstarter are your best options as those are the well known crowdfunding solutions.
The first answer went over some of the main platforms and the wp plugin in some great detail. You can utilize many of the existing platforms out there, some actually fit into particular niches as well. You can also build a website out and utilize an wp theme/plugin for crowdfunding needs. Finally there also software solutions out there which are turn key and already built out. Thrinacia offers a white label solution, which you can further customize as needed. Essentially you could be running your own crowdfunding website within minutes.
My friend share with me that he invested in real estate crowdfunding through a company called Crowdfund. After several research, I found that this company is doing real estate crowdfunding for companies in USA. Here is the website http://crowdfund.co/real-estate/
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