Understanding the Crowd Funding Process

October 25, 2011

Crowd funding is a process by which you can present your dream to the world and allow them to vote on it with their dollars. If you need to raise capital and don’t feel that traditional venues will work for you, you can turn to crowd funding and see what the majority of the world thinks about your idea.

For instance, if you wanted to start a business developing a new product that has never even been dreamed of before, you might not be able to do this with a traditional bank. And if there is no provable market, then you won’t be able to pursue an IPO, either. Besides, the IPO can be incredibly difficult and comes with a lot of red tape to trip you up. The SEC is vicious and loves to eat small businesses for lunch.

So if you feel that you are completely out of options, you could consider crowd funding. The process is fairly straightforward and easy to understand.

When you decided to use crowd-sourced capital, you will create a request through one of the websites that offer the service for crowd sourcing. You can request a significant sum of money for these loans. You will explain your project and provide proof of any necessary credentials verify you are able to handle a business of this type. Upon submission, your project will be released to the community, who will be able to review and decide whether or not they want to participate in this investment.

One of the benefits to having your dream come true through crowd funding is that you give others the opportunity to invest without having to spend significant sums of money. On some crowd funding websites, the minimum amount investable is just one dollar. This means that you will be able to harness the power of the masses to raise the money to start your venture. Imagine if you were able to collect only a single dollar from every person in your neighborhood. You would have a significant sum of money. Now imagine the power of opening this up to the world. That’s what crowd funding does for you.

For every small business owner with a dream that feels out of reach, crowd sourced funding is the step stool you need to get to it. If you are looking for an unconventional way to fund an unconventional idea, or are tired of dealing with the banks, you can consider crowd sourced capital. If you don’t want to bug your friends and family to invest in your brilliant idea, crowd funding can come to the rescue.

No matter how big or how small your company is, you can make your dreams come true with a loan processed through crowd funding. Once the idea is out there, the world can decide if it is worth taking a risk or not. If you present your idea and can’t get the funding from this source, then it may have been in your best benefit to scrap that idea and look for another one. Crowd funding will help ensure your dreams come true if at all possible!


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