You've got recommended for an eco vacuum cleaner. Or you'll need financing for an artsy project like re-cording a ska album, publishing an alternative lifestyle magazine or producing an all 80's film festival. Maybe the film festival project can wait. The purpose is you may be an entrepreneur, artist, or simply a typical person with recommended and can't get it off the bottom when you don't have access to financing.
It was once you had to rely on the three F's, friends, family and friends of family. For too many reasons to get into, it always isn't a good idea to bypass asking all of your relatives and friends for money Wefunder versus StartEngine. Even when they consent to loan you some money, the added burden mightn't be worthwhile in the long run.
Enter crowdfunding, which is another way of leveraging the "crowd" or the three F's and one new S, strangers. You post your project on one of many a lot more than 450 crowdfunding platforms worldwide and you watch for the cash to roll in. In accordance with crowdsourcing.org, $1.5 billion was raised in 2011 through crowdfunding.
You can find three forms of crowdfunding activities which are legal in the U.S. and Canada. Reward-based or using perks is one type of crowdfunding to get sponsors to contribute. Like you'd grant certain perks i.e. a totally free t-shirt, a totally free version of the computer game etc... Then there is donation-based which means if someone likes your idea enough, they just GIVE you some money. The 3rd type is lending-based crowdfunding which is just borrowing
money from strangers. Equity-based crowdfunding isn't yet legal in the US or Canada since it involves issuing equity, and providing disclosure which would necessitate the involvement of the Securities Exchange Commission and the Canadian provincial securities commissions. In the US, the JOBS Act, which outlines the particular rules for equity financing was signed into law by President Obama on April 5, 2012. The SEC has 270 days from the enactment date to create forth specific rules and methods to ensure that funding will in truth take place. So we're going to learn within the next 6 months precisely how the guidelines will apply.
But that's not why you're looking over this article. You intend to learn how to raise funds through crowdfunding. That is where your tens and thousands of friends on Face-book and Twitter are going to come in handy. You need to tell everyone about your campaign and keep telling them every time you've raised some money. Don't forget they have their particular personal network that could donate to your project. Write a press release and send it to publications and websites that you think would be interested in your story. They're always looking for an appealing story, so be sure that yours is! You shouldn't forget to exhibit sponsors how you're going to pay their money and what they need to expect in return.
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