Comparison of crowdfunding services
Crowdfunding is a process in which individuals pool money and other resources to fund projects initiated by other people or organizations. Crowdfunded projects may include creative works, products, nonprofit organizations, supporting entrepreneurship, businesses, or donations for a specific purpose (e.g., to pay for a medical procedure). Crowdfunding usually takes place via an online portal that handles the financial transactions involved, and may also provide services such as media hosting, social networking, and facilitating contact with contributors.
Funding models
Crowdfunding is donation-based fundraising for businesses or creative projects, typically via an online funding portal. Some but not all crowdfunding projects offer contributors rewards, which may differ based on the amount of money donated. Rewards can include copies of a creative work, products created with the funding, special or personalized incentives (such as autographed works or promotional merchandise), or public recognition.
In equity crowdfunding, a crowdfunding approach is used to raise investment capital and contributors receive equity in the resulting business. Contributors may act as investors and receive shares directly, or the crowdfunding service may act as a nominated agent.[1]
Donations and/or Rewards
There are two basic models provided for – some sites offer a choice between them:
- All or Nothing (AoN) – When the fund-raising period is over, money is only collected from the contributors if a pre-determined minimum amount of money has been pledged. If the goal is not met, no money is collected.
- Keep it All (KiA) – Whether the project goal is met or not, all of the funds collected (minus commission) are handed over to the entrepreneur. If he or she has insufficient funds to meet the objectives, then it is up to the recipient to refund them to the contributors.
| Name | Funding model | Focus | Country | Notes | ||
|---|---|---|---|---|---|---|
| ArtistShare | KiA | Musicians | US | Has own record label. | ||
| CentUp | KiA | Ongoing transactions and Social Impact | US | Decentralized crowdfunding linked to specific pieces of content. | ||
| ClassWish | KiA | Education crowdfunding for school and teacher supplies | US | Allows tax-deductible support of any school and any teacher in the U.S. | ||
| CommonBond | KiA | Student loans | US | Funded by crowdsourcing and large investors. | ||
| Community Funded | KiA | Platform Creation for Universities, Nonprofits, and Faith-Based Organizations | US | Allows for white-labeled integration on existing websites | ||
| Fig (company) | Equity, Rewards | Video Games | US | |||
| First Funder | KiA or AoN | Community based | US | Website inactive | ||
| FundAnything | KiA | Funding for any kind of project - business, creative, arts, personal, charitable. | US | Fundraising backed by major celebrities such as Donald Trump. | ||
| FundedByMe | AoN | Equity and rewards | Sweden, Finland, Norway, Italy, Germany, Denmark | Only platform offering equity and reward based crowdfunding in combination with European-wide cross-border investments. | ||
| FundRazr | KiA or AoN | Personal, charitable, entrepreneurial, creative, and political causes | Canada | Lets you embed your campaign on Facebook, blog or website using easy to use Widgets. Offers Live Chat and Personal Coaching. | ||
| Fundly | KiA | Personal, charitable, and political causes | US | Available as an app for a Facebook page. Charges a per credit card transaction fee. | ||
| GiveForward | KiA | Online fundraising website to raise money for medical expenses. | US | Provides personal fundraising coaches. | ||
| GlobalGiving | KiA | Nonprofit fundraising for registered organizations in 160+ countries | US, UK, Worldwide | Provides 501c3 equivalency for non-US organizations | ||
| GoFundMe | KiA or AoN | Non incentive-based crowdfunding website. Set up to allow for donations to personal causes and life events. | US | Provides 5-minute customer email support. | ||
| Headstart | AoN | Entrepreneurs | Israel | |||
| ICrowdFund | KiA or AoN | Donation and Reward | Ireland | Non-profit and individual crowdfunding with donation and reward options. | ||
| Indiegogo | KiA or AoN | Allows a broad range of projects | US | |||
| JustGiving | KiA | Social good causes and campaigns | UK | Non-profit and individual donation crowdfunding. | ||
| Ketto | KiA | Funding for any kind of project - business, creative, arts, personal, charitable. | India | Largest platform in India. | ||
| Kickstarter | AoN | Creative projects | US, UK, Canada, Australia, New Zealand, the Netherlands, Denmark, Ireland, Norway, Sweden, Germany, France, Spain, Italy, Austria, Belgium, Switzerland, Luxembourg[2] | Highest funded projects to date | ||
| LaunchGood | KiA or AoN | Allows a broad range of projects | US, Canada, France, Russia, Brazil, and 15 other countries | Largely faith-based, focused on the worldwide Muslim community | ||
| Mobcaster | AoN | TV shows | US | |||
| Myfreeimplants | AoN | Cosmetic surgery | US | Focused on breast augmentations. International | ||
| Offbeatr | AoN | Pornography | US | Inactive. Projects were to get enough votes from users before being open for funding | ||
| Peoplefund.it | AoN | UK | Attached to Hugh Fearnley-Whittingstall | |||
| Piggybackr | KiA | Young children, students, and teams | US | Young students may raise money. Compliant with Children's Online Privacy Protection Act | ||
| Planeta.ru | AoN or KiA | Allows a broad range of projects | Russia | |||
| PledgeMe | AoN | Allows a broad range of projects | New Zealand | |||
| PledgeMusic | AoN | Musicians | Spain, UK, US | |||
| Pozible | AoN | Creative | Australia, Singapore, Malaysia, US | Bitcoin can be used, Self-hosting can be used, One-on-One help | ||
| Rally.org | KiA | Medical, educational, charitable, creative, entrepreneurial, and political causes | US, Germany | |||
| RocketHub | KiA | US | ||||
| Sellaband | AoN | Musicians | Germany | |||
| Sponsume | KiA | UK | ||||
| Tilt.com | KiA or AoN | Any goal | US | Offers both a consumer product and enterprise solution for brands. | ||
| YouCaring | KiA | Medical expenses, memorials and other personal and charitable causes | US, UK, Western Europe | Does not charge any fees, other than payment processing | ||
| Weeve | KiA | Nonprofits | Canada | Inactive site once operated a "freemium" model without transaction fees | ||
Donations only
Some services invite people to donate to projects for the pleasure of giving. Philanthropy based services usually have other benefits such as tax credits or rebates.
| Name | Funding model | Focus | Country | Notes | Number of Donors | Donated Sum |
|---|---|---|---|---|---|---|
| DonorsChoose | AoN | Education | US | 1,974,461 | ||
| Experiment.com | AoN | Scientific research | US | Formerly called Microryza | 19,266 | $5 Million |
| Givology | AoN | Education in developing countries | 22,443 | $500,969 | ||
| Kopernik | AoN | Distributing basic technologies in developing countries | ||||
Money for business ventures
Crowdfunding can be used to raise capital (equity) or borrow money. While organized informally, they typically involve large numbers of small investors or lenders:
- Equity crowdfunding – Investors receive equity in the company or entrepreneur that is raising funds.
- Debt crowdfunding – The entrepreneur or company borrows money and must repay it (typically, with interest).
- Property crowdfunding - Investors receive interest in the property from an owner who is raising funds.
- Other crowdfunding – There are a number of other schemes in use which are generally unique to particular services, e.g., perks, publication, or rewards.
| Name | Funding model | Focus | Country | Notes | Number of Investors | Invested Sum |
|---|---|---|---|---|---|---|
| Angels Den | Equity, Debt, Donations | All businesses | UK | |||
| AngelList | Equity, Debt | Start-ups | US | Currently serves only accredited investors | $104 Million | |
| BnkToTheFuture | Equity, Debt, Rewards | small businesses and new start-ups crowfunding | CYM | |||
| CircleUp | Equity | Consumer products and retail | US | Currently serves only accredited investors. | $50 Million | |
| Companisto | Equity | European companies, Investors from all over the world; Crowd Investing + Venture Loan[3] | Germany, Switzerland / Europe | 50,000 | €27 Million | |
| Crowdfunder | Equity, Debt | Small and medium-sized businesses | US | Currently serves only accredited investors | 12,000 | $100 Million |
| CrowdCube | Equity, Rewards | start-ups, small businesses, growing businesses | UK | 167,384 | £80 Million | |
| EarlyShares | Equity | US | ||||
| Emerging Crowd | Equity, Debt | SMEs in emerging and frontier markets | UK | |||
| EquityNet | Equity, Debt | Startups and mature companies | US | Launched crowdfunding platform for Reg D offerings in 2005 | $200 Million | |
| Fig (company) | Equity, Rewards | Video Games | US | |||
| Fundable | Equity, Rewards | Seed stage businesses | US | $164 Million | ||
| FundedByMe | Equity, Rewards | Entrepreneurs | Sweden, Finland, Norway, Italy, Germany, Denmark | 61,592 | €16 Million | |
| Funding Circle | Debt | Small businesses | UK, US, Spain, Netherlands, Germany | 39,738 | £1,000 Million | |
| Gambitious | Equity | Game development | Netherlands | |||
| Innovestment GmbH | Equity auctions | Germany | €2 Million | |||
| Invesdor | Equity and debt | Startups and growth companies | Finland, Sweden, Norway, Denmark and UK | First fully licensed and fully passportable (MiFID) equity crowdfunding platform in EEA | €10.6 Million | |
| InvestedIn | Equity | USA | $47 Million | |||
| Invest Next Door | Equity | Small Businesses | US | Currently serves only accredited investors | ||
| Kiva | Debt | Entrepreneurship in developing countries | non-profit organization | 1,286,412 | $703 Million | |
| Lendico | Debt | Small and medium-sized businesses | Germany | |||
| Lending Club | Debt | USA | $9 Million | |||
| LendingCrowd | Debt | Small and medium-sized businesses | UK | First Scottish peer-to-peer lending platform | £1.2 Million | |
| LendInvest | Debt | Property Development Entrepreneurs/ Mortgages | UK | First live peer-to-peer lending platform specifically for residential and commercial mortgages | £308 Million | |
| MicroVentures | Equity | Tech Startups & High Growth | US | Currently serves only accredited investors | 28,000 | $70 Million |
| Optimize Capital Markets | Equity | Canada | ||||
| OurCrowd | Equity | Israel | ||||
| PledgeMe | Equity | New Zealand | ||||
| Prosper Marketplace | Debt | USA | 2,200,000 | $3,000 Million | ||
| rebuildingsociety.com | Debt | All businesses | UK | |||
| Return on Change | Equity | Early and growth stage startups in critical industries | USA | |||
| SecondMarket | Equity, Debt | Late stage start-ups and privately held companies at a pre-IPO or pre-acquisition stage | USA | |||
| SeedInvest | Equity | Early stage technology startups | USA | Currently serves accredited investors and Regulation A public rounds. | 100,000 | $50 Million |
| StartEngine | Equity | Early stage technology startups | USA | Currently serves accredited investors and Regulation A public rounds. | $17 Million | |
| Seedrs | Equity | Seed-stage businesses, Investments from £10+ | UK & Europe | First equity crowd funding platform to be approved by the FSA in the UK. | 30,000 | £100 Million |
| Seedups | Equity | Early stage tech-startups | UK, Ireland, USA & Canada | |||
| Symbid | Equity, Rewards | Start ups and business ideas, entrepreneurs, small businesses, accelerators, incubators, crowd investors, angel investors | Netherlands | Responsible for one third of the Dutch crowdfunding market in 2012 | 33,500 | €321 Million |
| SyndicateRoom | Equity | Growth businesses | UK | £37 million | ||
| TenPages.com | Revenue sharing | Books | Netherlands | |||
| ThinCats | Debt | Small businesses | UK | £110 Million | ||
| Trillion Fund | Equity | environmental and social projects | UK | 7,000 | ||
| TrustLeaf | Debt | Small businesses | US | Friends and family crowdfunding | 1,600 | $41 Million |
| TubeStart | Equity | Video production | US | |||
| Unbound | Perqs | Books | UK | Acts as both a crowdfunding platform and a publisher. Launched Terry Jones' Evil Machines, the first book to be financed by crowd funding. | ||
| Upstart | Debt | Loans for recent college graduates | US | Currently serves only accredited investors | ||
| Wahooly | Equity | Tech startups | US | Rebranded to chasm.io in May 2013, closed in September 2014 | ||
| Wefunder | Equity | Startups | US | 45,000 | $13 Million | |
| Zencap | Debt | Small and medium-sized businesses | Germany, Spain, Netherlands | |||
| Zopa | Debt | UK | ||||
Continuous funding
Some services allow for a continuous funding model as opposed to a one-time donation. These tend to apply to, but are not limited to, art projects such as music, YouTube videos, podcasts, web-comics, etc. — anyone who makes content on a regular basis. They differ mainly in the frequency in which payments are charged to the funders.
| Name | Frequency | Focus | Notes |
|---|---|---|---|
| Bountysource | Monthly or one-time donations | Open-source software developers | Money can be withdrawn via PayPal, Check, Bitcoin, and Ripple or used to post software bounties within Bountysource. |
| Patreon | Monthly or every time new content is released | Musicians, Podcasts, Vloggers, Youtubers, Webcomics | Subscribing to a project allows to view and post on its content stream. Patreon allows to set a monthly maximum to avoid going over a set budget. |
| Subbable | Monthly or one-time donations | Web series (both entertainment- and education-oriented) | The money that users spend goes into a "perk bank" and can be redeemed for creator-determined perks. Free subscriptions are available. |
| Sprked | Monthly or everytime content is released | Modders (mod creators), Indie gamers, Live streaming, Gaming related | The site uses a subscription-based model but the actual mods are not allowed to be sold. |
- This list is incomplete; you can help by expanding it.
Post-creation services
Some services invite people to reward creators after they already published their work.
| Name | Method | Focus | Notes |
|---|---|---|---|
| Flattr | Flattr button display along the content | Content creators | |
- This list is incomplete; you can help by expanding it.
See also
References
- ↑ "Der Treasurer". cfo-insight.com.
- ↑ "Creator Questions » Frequently Asked Questions (FAQ) — Kickstarter". www.kickstarter.com. Retrieved 2016-01-20.
- ↑ "Neue Anlageklasse Venture Loan - Start am 18.08.15". Companisto.
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