Crowdfunding has evolved as a revolutionary form of financing, disrupting the big banks and private investors. It received mainstream attention around 2009 when startups like Kickstarter truly empowered creators, designers and entrepreneurs to reach out to the crowd and pursue their passions.
When I got the idea for Valuation App, I had no prior experience of launching a product, running a company, or raising capital. All I had was some solid education and an undying passion to see my vision come alive. Now traditionally, wantrapreneurs like myself who didn’t even have a prototype would have to be fortunate, or have some solid connections to be taken seriously. That changed, thanks to crowdfunding platforms like Appbackr, which allowed individuals to raise money for mobile apps on the merits of a concept, prototype or existing product. I ended up raising over $3,000 from 57 backers by requesting individuals to pledge a minimum of $11 each. This made me realize how powerful the crowd could be and got me working on iFunding, which today is the leading real estate crowdfunding platform in the world.
Having gone through the drill and launching the most successful real estate crowdfunding site in the world, here is what I strongly believe crowdfunding helps with:
- Proof of concept: Prior to the emergence of crowdfunding, many creative ideas were killed without ever reaching potential consumers. Sites like Kickstarter have provided countless entrepreneurs and creative professionals with a platform to get their ideas in front of the world and then let the crowd decide what they want to see materialize by backing worthy concepts. When founders of the Pebble smartwatch failed to raise funds from angel investors, they turned to kickstarter and ended up raising $10.26MM from 68,929 individuals who wanted to see this product come to life. Fast forward to today, BestBuy recently announced it would carry Pebble smartwatches.
- Access: My startup iFunding stayed true to our vision of crowdfunding and raised money from the crowd on Crowdfunder. We set out to raise $2MM off which we raised the first million in just three days. Till date we have raised over $2.4MM. The beauty of crowdfunding ourselves has been the fact that we got backed by some notable investors, such as Alicia Syrett, CEO of Pantegrion Capital. Access to such investors has traditionally been extremely difficult, yet individuals like herself and Barbara Corcoran are now seeking their next investment via crowdfunding websites.
- Recognition: Many entrepreneurs choose crowdfunding as a source of financing not because they cannot raise funds from private investors. Rather, they do this because they know that when the crowd backs a product, it has a vested interest in seeing it succeed. This is what worked phenomenally well for me when I raised money for Valuation App. Every backer wanted the app to do well, so they downloaded and shared it to help it get more recognition. This is what helped the app get discovered in app stores where you have millions of apps to overshadow yours. And it helped me connect with individuals who recognized my potential to pursue future opportunities with.
Email me at email@example.com if you want to learn further about crowdfunding.blog comments powered by Disqus