Crowdfunding platforms are websites that allow entrepreneurs to raise money from a large community. Such platforms can be divided into 3 types: cash-for-support, cash-for-equity, and cash donation HeffX-LTN offers all 3, contact us.
- Cash-for-support platforms came up 1st with IndieGoGo & Kickstarter leading the way in 2008 & 2009 respectively. Since their launch,WeFunder has also become popular for this sort of crowdfunding.
- On these platforms, individuals essentially donate money to the entrepreneurs because they want to help them create their product. In most cases, after an individual pledges enough money, the entrepreneurs will promise to send them merchandise in exchange for their support.
- In Y 2010, Naval Ravikant and Babak Nivi, the writers of the popular blog, VentureHacks, teamed up with Kevin Laws & Stan Chudnovsky to start one of the most popular cash-for-equity platforms, AngelList. AngelList initially started as a directory of active angels & founders, but has since evolved into a platform for startups to raise capital & recruit talent. Other well-regarded cash-for-equity platforms include CircleUp, FundersClub,Gust, and SeedInvest.
- In Y 2013, Patreon launched to give creators a way to get paid by their fans and has since become the most popular cash donation platform
Not all crowdfunding methods are created equal.
Some platforms allow companies to raise money from unaccredited investors in-line with SEC rules on Regulation Crowdfunding.