If you are someone who knows little to nothing about business or investment, we definitely can be best friends. People can talk for hours about the economy and the stock market – leaving me feeling pretty stupid and left out at times. However, it got me thinking, what if one day I decide to start my own business venture? When exactly should I start educating myself? I believe the answer is right now.
To start a business, one fundamental need is money. With the lack of financial resources, it is merely impossible to get any business plan to work. Who can you turn to when you come across this issue? It’s time to learn what crowdfunding is all about.
Crowdfunding to the rescue!
What is crowdfunding?
Crowdfunding is the use of small amounts of capital from a large number of individuals to finance a new business venture. Basically, it is about persuading individuals to each give you a small donation for you to start up your business venture, Investopedia says.
Crowdfunding makes full use of the Internet – the efficiency of the vast networks of people through social media and crowdfunding websites bring investors and entrepreneurs together. If an investor decides to invest their money in you, your business development that either is a success or failure could affect everyone that is involved. Hence, it is crucial to showcase and present your ideas, hopes and benefits of your business venture to the future investors. For example, project founders of the new business venture would create a profile typically containing short video, an introduction to their project, a list of rewards per donation, along with images to elaborate. Ideas as such can create a message that would be relatable to everyone.
How is Crowdfunding different?
The “investors” are not necessarily wealthy, they could be ordinary people like you and me. The person wishing to raise funds, must communicate and pitch their idea on the crowdfunding platforms to attract the interest of would be investors or funders. Normally such project is communicated by way of a marketing campaign run on a social network like Facebook, Twitter, or a Youtube video. If you’re lucky enough, you would be doing yourself a great help by landing in big-time donors.
Which leads to the next question, what benefit would crowdfunding get over the traditional method of doing business?
1. Reaching out
By using a crowdfunding platform, you have access to thousands of credible investors who can see, interact with and share your fundraising campaign. This could be good networking for future business deals as well.
2. Gaining loyal advocates
The people that believe your story, idea and product is the “it” factor that is going to sustain your longevity and long-term success in the entrepreneurship world. They are the ones most likely to share your vision with friends and family and promote it through social networks.
By creating a crowdfunding campaign, you have to go through the process of looking at your business from scratch. From its history, traction, offerings, market value and more – boiling it down into a more polished, organised package for investors to fully comprehend the business venture you are into.
With online crowdfunding, you can centralise and streamline your fundraising efforts. By setting up a profile on the crowdfunding platforms, you can funnel all your prospects and potential investors – eliminating the need to pursue them individually. So, whenever there is a new update on your business venture, you can simply present everything online in a much more accessible format. This saves you time and effort – enabling you to run your business more efficiently. It is similar to the concept of applying for a job on JobStreet and updating your newest resume in.
How do I find this crowdfunding website?
Here is a list of crowdfunding sites you can look up to;
- MyStartr (Link here)
- Turns creative projects like films, games, music, art, design or technology into reality.
- Peoplender Sdn Bhd ( Link here)
- Driving greater access to financing micro entrepreneurs and start-ups.
- Netrove Ventures Group (Link here)
- Taps into early-stage incubators and investing marketing groups.
- GIVE.MY (Link here)
- Especially for teachers who want to start creative projects through the power of education.
- SkolaFund Sdn Bhd (Link Here)
- Platform for deserving underprivileged undergrads that wishes to pursue a tertiary education.
- Alix Global Sdn Bhd (Link here)
- Strengthening the competitiveness of small and medium-sized enterprises(SMEs) in Malaysia.
Crowdfunding has proven itself as a great asset in sourcing potential customers and growing an audience. What are your thoughts about crowdfunding in Malaysia?