Although still fairly new, crowdfunding has successfully helped thousands of small businesses and entrepreneurs raise an enormous amount of funds. Although simpler and often times more accessible than traditional methods of raising money, crowdfunding still requires a lot of effort and dedication in order to be a viable financing option. Here are three benefits to using a crowdfunding platform to raise funds for your small business.
Raising capital without giving up your company
Entrepreneurs often think that they can only raise capital from accredit investors, banks, and VCs. But this isn’t true. Crowdfunding is a great alternative to fund a venture, and it can be done without giving up shares in your company or accumulating any debt. Rewards-based crowdfunding allows entrepreneurs to raise capital from the community in exchange for nothing but their product. If it interests contributors, and enough of them are willing to fund you, you can fund your venture and still retain 100% ownership of your company.
It provides viable marketing
An active and popular crowdfunding campaign is a great way to introduce a company’s overall vision to the market, and it’s a simple and free way to advertise to numerous channels. Most crowdfunding platforms incorporate some sort of social media integration, which drives traffic from your campaign to your website or other social media pages.
It’s easier than traditional funding
The application process for crowdfunding is a breeze in comparison to the traditional method of applying for a loan or pursuing other capital investments (especially for early stage companies). In order to begin, you only need to contact your chosen crowdfunding platform and share your company’s story in order to entice potential contributors.