Crowdfunding
Crowdfunding works by gathering small amounts of capital from a large number of individuals to form an investment. This helps to expand the pool of potential investors into your startup beyond your network. There are different types of crowdfunding depending on what investors get in return of their money. For very early-stage startups crowdfunding can also help to test traction before committing own funds or talking to potential investors.
Types of Crowdfunding
Reward Model
Tangible or intangible reward
Campaign gathers financial
contribution in return of some kind of
reward (usually your product)
Examples
Lending Model
Interest on money given
Investors receive interest in return for
the funding provided by them
