Crowdfunding is a financing model in which a project or venture raises money from a large number of people, typically in small amounts over the internet, connecting a project initiator, many individual backers and a moderating online platform. This description is adapted from Wikipedia contributors under CC BY-SA 4.0; changes were made. https://creativecommons.org/licenses/by-sa/4.0/
Facts
Core MechanismA project initiator proposes an idea to a large number of potential backers through a platform; reward-based crowdfunding pre-sells the product without incurring debt or sacrificing equity, while equity crowdfunding exchanges funding for company shares. 1 Origin YearArtistShare, launched in 2001, is generally cited as the first dedicated online crowdfunding platform, followed by Kiva (2005), Indiegogo (2008) and Kickstarter (2009). FAQs
Who is involved in a crowdfunding campaign?
A project initiator, many small backers, and a moderating online platform.
Crowdfunding connects a project initiator, many individual backers and a moderating online platform, with a large number of people typically contributing small amounts over the internet toward the total raised.
Connections
Associated With
Crowdsourcing and crowdfunding are sibling coinages from the same internet-enabled crowd-participation wave: crowdsourcing gathers ideas, content or labor from a dispersed public, crowdfunding gathers money from one.
Crowdfunding lowers the capital-raising barrier entrepreneurship traditionally required from banks or venture investors, letting founders fund ventures directly from prospective backers.
Source Wikipedia, Crowdfunding
Pretail, Business Models Pretail pre-order commerce is closely derived from the crowdfunding model.
Sources
1. Wikipedia, Crowdfunding
Wikipedialead sectionQuote, lead section
Crowdfunding is the practice of funding a project or venture by raising money from a large number of people, typically via the internet.
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