Best Crowdfunding sites for startups


Are you one among the people having the idea of starting an enterprise without having much money to establish it. Nowadays doing crowdfunding campaign on crowdfunding sites seems to be very helpful to raise funds for startups.

The public who have interest in your idea will fund you and most crowdfunding sites earn by taking the small amount of the money you raised through funding. These crowdfunding sites are designed for B2C business.

There are three types of crowdfunding,

  1. Rewards crowdfunding – An entrepreneur will promote a product or service to inaugurate a business concept without experiencing debt or sacrificing equity.
  2. Equity crowdfunding – A person who contributes fund will receive shares of a company.
  3. Debt crowdfunding – Here investment is considered as a loan or debt. The company is legally responsible to repay the investment made by the contributor.

Best Reward Crowdfunding site 

Indiegogo

Indiegogo

It is one of the largest fundraising sites in the current scenario. This site is very helpful and hopeful to raise money for the business categories like eco-friendly, design, film, travel, technology. This site is also a better choice for female business owners.

It is most famous for reward crowdfunding and as well as offers equity crowdfunding. Since this is a large site, it will be very hard to stand out.

5% of what you raise is taken as a fee.

Peerbackers

peerbackers

This Peerbackers is considered as one of the top crowdfunding websites in the industry. This site mainly focuses on contributing entrepreneurs and innovators.

There are lots of creative entrepreneurial projects are promoted in this site from the people around the world. Currently, this site has been expanded to accept the young entrepreneurs who come under the age of 13 to 17.

Peerbackers started a Crowdfunding Academy to give education and support the people after facing a high industry failure rate for crowdfunding projects.

Kickstarter

kickstarter

A well-known crowdfunding site is Kickstarter that focuses on creative ventures including the arts, design, gaming, and technology.  This Kickstarter allows the projects of U.S., U.K., and Canada.

This site will take 5% cut from what you raise and also 3-5% as payment processing fees.

RocketHub

rockethub

This crowdfunding site is started for arts and soon expanded to include education, science, business, social good projects. It started a partnership with A&E Networks and through which extra support will be given to some selected projects from the joint initiative. This crowdfunding site has “Success School” that helps to know the ways of launching a crowdfunding campaign in a successful way.

This site takes 4% of the amount from a campaign that is profitably funded and takes 8% from the campaigns that didn’t meet their goal. Also, it takes 4% as credit card processing fee.

inKind

inKind is the new name of the site EquityEats, the site is particularly produced for restaurants. The kind of business like restaurants are the most underfunded industry in the US. It is very glad to have a crowdfunding that is intentionally made for the restaurants, cafes, bakeries, and for food truck owners.

The contributors may get benefits like free credit towards food and beverage and desserts.

Fundable

fundable

This site is entirely for businesses while other crowdfunding sites are designed to use for several purposes. This site will help you to get an idea of fundraising process before launching campaign.

This Fundable site takes a fixed monthly rate($179) instead of taking a percentage of the money you raise and 3.5% plus 30 cents as credit card processing fee.

This site proposes both reward crowdfunding and equity crowdfunding.

GoFundMe

This crowdfunding site is raised for personal or charitable causes and businesses are also accepted as well. There is no maximum to the money you raise and also for small projects this site is raising a small amount of money.

This site is considered as a not good site for raising a large amount of capital.

It takes 5% amount of money from your raise as fees and 2.9% plus 30 cents as payment processing fee.

FundRazr

This site is raised in 2010 and 60,000 campaigns over the world get over $86 million in funding. This site is available for a variety of users such as for individual and for business. This site makes easy to share your campaign to get fund from supporters.

One of the main cons of this site is, it is unclear to know about the activeness of the current site since.

This site takes 5% amount of money from your raise.

Experiment

experiment

This crowdfunding site is considered as an ideal for business that includes the areas such as health, medicine, and for scientific research.

This site depends on how much you are expertise in your field. Each and every proposal will be reviewed by a team of community scientists to make sure whether it is perfect for criteria of this site.

5% of what you raise will be taken and 3% as payment processing fee.

Best Debt Crowdfunding Sites

Crowdfunding sites that are based on debt are generally mentioned as “crowd lending” and this debt crowdfunding site demonstrated as the best source for the startups. Moreover, this site is suitable for B2C businesses and B2B businesses.

This is similar to the loan given by the banks. Through this site, the investor gets a share of the investment made by them.

Using this site, a lot of small business owners and startups gets benefited financially. The cost for the debt crowdfunding sites is referred here as an APR(Annual Percentage Rate) which is the cost of the loan over one year that includes fees.

This APR of loan brings it very comforting to compare various loan products.

Kickfurther

kickfurther

This Kickfurther crowdfunding site provides loan for inventory financing. One must have completed a successful production run if that person wants to use this Kickfurther as his crowdfunding site.

This Kickfurther is considered as one of the best sites for crowdfunding since the pliability that this site gives to the users.

Every user can set the interest rate that he is going to pay for the contributors and also the period of the time that is estimated for selling his inventory.

The cost of the loan that is, average APR is 20 – 30%. When you withdraw funds from the site, 1.5% will be charged a withdrawal fee.

Prosper

Using Prosper will let you get a personal loan that is up to $35,000 and this amount could be useful for business purposes. This prosper is one of the world’s largest crowdfunding sites.

It is very simple to get a loan from this site and the whole process of getting loan usually takes under one week.

To be eligible for getting a loan from this site one must have the credit score, at least 650.

If the credit score is not strong, the interest rates will be high. $35K is fixed as limited capital.

Here average APR is calculated as 5-30%

Lending Club

lendingclub

This crowdfunding site is ready to offer for both larger business(up to $300K) and personal loans(up to $40,000). One can use this personal loan for business purposes.

The person who received the loan can pay back the amount in 1-5 years. Within a week one can finish the whole process of applying for a loan and getting the funds.

The credit score of 650 is needed to be eligible for getting a loan in this site. Forgetting business loans, one must have the annual business revenues minimum $75,000 and at least 2 years of operating.

As the credit score is low, the interest rate increases.

An average APR for this site is 5-305.

Funding Circle

This Funding Circle offers business loans up to $500K. So it will be worthful if you are in the need of more capital. This site seems to be cheaper than Lending club and Prosper.

One needs a credit score of 620 and $150K as annual revenues and at least 2 years of operating in business.

An average APR for this is fixed as 13-18%.

Kiva

kiva

This crowdfunding site provides 0% interest and no-fee loans across the US and the world”s entrepreneurs. An entrepreneur can get up to $10K over 36 months. Through this site, 2 million entrepreneurs have raised over $850 million.

A person who wants to get a loan from this site must be at 18 years old and a US resident and then he must use the loan only for his business purpose. One should be able to manifest his social capital by doing a loan to any other business and also having more friends and members of his family to make a loan to him.

The capital given by this site is limited to $10K. So this is considered as one of the disadvantages of this site.

RealtyShares

This RealtyShares is a leading crowdfunding site used to gain money for buying commercial real estate and for a residential fix. This site helps to fund your real estate project within 10 days.

A person may be eligible for up to 90% loan-to-value and short-term or long-term financing and this is based on his credit and background.

This RealtyShares is offering both debt and equity crowdfunding. The borrower must borrow $500K and above.

RealtyShares’ average ARP is 8-12%

Patch of Land

patch of land

This crowdfunding site is alike RealtyShares and one can get the fund for smaller projects as little as $100K.

One may eligible for up to 80% loan-to-value and the loans usually close in 1-2 weeks.

The disadvantage of this site is, it will be hard to qualify if the person who is seeking a loan is a first-time real estate developer or flipper.

Average of this site’s APR is 8-12%.

Best Equity Crowdfunding Sites

On the crowdfunding site that is based on the equity, the person who raised money must give away a part of the ownership of his company to the one who contributes with funding.

AngelList

AngelList

This equity crowdfunding site is one of the oldest and well-known sites. AngelList site is used by many companies such as Uber, Thumbtack, Postmates to meet investors.

US or UK based companies can apply on this site to get funded. For entrepreneurs, this site is entirely free to use and helps to find a way to come face to face with accredited investors and a lot of tools that can be used to manage the process of investment.

The main disadvantage of this site that it will be very tough to get attention since there is a large number of businesses uses this site.

It’s absolutely free of cost.

Crowdfunder

crowdfunder

It is one of the greatest crowdfunding sites and the main motive of this site is to help small businesses that find hard to raise venture capital. One can select his company stage, location, and area of business.

Almost all the deals on this site are based on the equity deals and also there will be deals that is based on debt options.

This site seems to be costlier than other sites.  Cost of fee starts at $199/month

CircleUp

CircleUp

There is a statistics that this site has helped over 196 startups that raised over $260 million in funding. This site is considered as one of the largest sites for equity crowdfunding and marketplace investing.

Within 2-3 months an average startup raises more than $1 million on this CircleUp. These companies on CircleUp seems to be more innovative.

This site manages the closing process that includes funding, escrow, and also the transfer of funds.  On this site, small businesses may feel tough to get observed. This is one of the main backdrops of this site.

This site will take 5% cut from the funds that are raised by the borrower.

EquityNet

equitynet

This EquityNet is most established and old equity crowdfunding site. Through this site, one can raise a small amount of money which is not possible on other sites. A borrower can raise money as small as $10K or as much as $10million using this EquityNet.

Almost many features ask for a paid subscription on this site and this is considered as one of the main disadvantages.

This site takes $600 for 3 months as a fee.

RealtyMogul

realtymogul

This equity crowdfunding is one of the largest crowdfunding and there are more than 28.,000 investors ready to fund variety of projects, from a family’s residential or office buildings to commercial properties.

There is a timeline for raising funds that varies from 30-40 days and funds that the borrower needs may be covered up to 90% of his costs.

Above all this site mainly concentrates on large real estate deals that start at $1 Million

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