There are many projects that need capital that the person who has the idea cannot contribute, and in many cases, it is not viable to ask for a loan. To do this, there is always the possibility of asking for donations or seeking collective financing among all those who are interested in materializing the idea.
What is crowdfunding
The crowdfunding is a new system of collective financing, in which participation or donation of all those who wish to participate in a project that someone has created, thus finding the necessary funding to carry out searching.
As compensation for taking part in the financing, the participants usually receive something related to the project itself, such as promoting them for having financed them, gifts of products and services or any other type of compensation related to the project itself.
These compensations are usually received, although in the very idea of crowdfunding, they are dispensed with.
One of the most characteristic uses of this financing is for the creation of small business projects and to finance artists and musicians who are beginning in their careers.
Steps in crowdfunding
There are several phases that must be carried out to obtain financing in the crowdfunding model:
- In some of the existing crowdfunding platforms, the project is published, determining what it consists of, the amount of money that is needed and in what way it will be rewarded in the event that there is a reward.
- There is a certain time to obtain this financing, in which we will have to take care of publicizing the project among potential stakeholders and promoters, social networks, our circle of acquaintances, etc., in order to get the money and that people know it.
- Once the time has ended, depending on the type of project and financing that we previously chose, if we obtain all the necessary money, we will receive it to begin our activity. If we do not reach 100% but the cooperators agree and it is viable, we can carry it out, otherwise, all the money will be returned.