Is crowdfunding a viable way to fundraise capital for your start-up?

A few years ago I was told when raising money that I should look to get it from my triple F: Friends, Family and Fools. I did not think that was a particularly wise remark so I didn’t follow the advice.

Traditionally start up companies would raise capital to start up their business by going to Angel and Venture Capital (VC) investors to raise seed funding. Today this is still the most common way for entrepreneurs to raise capital investment for their business. However in the last few years a new fund-raising method has been gaining popularity.

Crowdfunding is a method of collecting money from a collaborative network of people. The internet has been made it possible for people to collaborate to fund projects in the commercial, social, and charity sectors.

Some of the more successful crowd funding.

The final video is from Pleasefund.us, and is another social project. This is a theatre group based in south London, called The Last Refuge Theatre build, which is also still raising funds. Here is their video:

Crowd funding could be an option for any startup business currently being run on a shoestring. However, if you are considering crowd funding as an option for raising capital you need to think what reward you can offer to your funders. The people who give you their pledges will still want to get something in return. For more information, why don’t you check out any of the websites I mentioned above.

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