12 Best Crowdfunding Sites For Small Business
As a small business owner, you might be looking for ideas of where to get capital from to take your business venture to the next level. After you have made a business plan, invested your own savings, and worked your business as a side hustle for a few months, it is time to raise some real capital.
Luckily, the bank is not your only option anymore. There are sites where people can invest in your project, idea or business. Crowdfunding sites are all over the internet these days. Below we have gathered together the best crowdfunding sites for you whether you’re funding a startup, creative endeavor or raising money for a cause or project, there will be something on this list for you.
Kickstarter helps creators connect with the resources they need to bring their ideas to life. The company has helped 15 million artists, musicians, filmmakers, designers and other creators raise $3.7 billion to successfully fund more than 143,000 projects. It is an all-or-nothing situation with funding as you have to meet the goal you set within the allotted time or everyone gets their money back.
It is free to create a project campaign on Kickstarter but if you successfully get funded a 5% fee is owned from your collected funds. You will also get charged processing fees between 3-5%.
Indiegogo doesn’t just offer both live crowdfunding campaigns, but they also have a marketplace for innovative products. They have helped entrepreneurs raise $1 billion for more than 650,000 projects. Find out if your idea has legs and raise starter capital with Indiegogo’s “global network of early adopters”.
With this platform, you don’t have to stop raising money at a specific time. There are no fundraising targets or deadlines and you can apply equity, offer securities, revenue sharing and even cryptocurrency sales.
Indiegogo charges a 5% platform fee for all projects. If you’re raising money for a cause, you don’t have to pay any fees with Indiegogo’s sister platform – GoFundMe.
3. Crowd Supply
Whether you want to bring a family recipe to market or build electronics, Crowd Supply can help you. Their mission is to “bring original, useful, respectful hardware to life” has come to fruition with 70% of its launched projects being successfully funded (2x more than Kickstarter). The average amount raised per successful project is $66,000 (6x more than Kickstarter for comparable projects).
You can choose from a variety of Crowd Supply payment plans. The Standard Plan is 5% of gross campaign sales not including processing fees, the Guided play is 5-10% and the Custom plan 10—15%. Features differ per plan and include campaign management, media asset creation and a dedicated PR team.
Join Crowdfunder to connect to a community of 200,000 entrepreneurs and investors. This community offers equity crowdfunding which means that entrepreneurs sell shares of their company to accredited investors. They have raised over $150 million dollars from 12,000 VCs and angel investors to help all sort of startups from Pre-Seed to Series A.
Crowdfunder offers Free, Starter ($299/month) and Premium ($499/month) plans each with a variety of services like document storage and personalized support.
This is the platform to fund scientific discoveries. Experiment backers fund projects that “push the boundaries of knowledge” like dinosaur fossil evacuations to the historical study of medieval monasteries. They fund project scientists without the overhead costs they would have to otherwise face with university grants (which can be 50-60%).
It is free to start a project but once you receive full funding Experiment charges an 8% platform plus payment processing fees between 3-5%.
Chuffed helps social causes aimed at helping animals, your community or the environment. This platform is for not-for-profit companies and cause-based organizations exclusively. Their most successful campaigns have raised an average of $7,000. Nearly 8,000 campaigns have collectively raised $18 million.
Donors pay your processing fee. So, a $100 donation would require a $3 fee from the donor. Plus, all donors are encouraged to make a small donation to Chuffed too.
Patreon helps artists, musicians, writers and more get paid by running a membership business for their fans. This stream of revenue comes from fans paying you a subscription fee of their choosing in exchange for exclusive experiences and behind-the-scenes content. Creators have raised $350 million and the average patron pays a monthly fee more than that of Netflix and Spotify.
The fee is 5% of successfully processed payments. There’s no payment processing fee each time a payment is processed but it is batched at the end of each month. There are also payout fees charged for moving funds from your creator balance to your bank or PayPal account.
Create a profile on Fundable and then choose a program. Consumer-facing companies can raise up to $50,000 with their rewards program that allows entrepreneurs to sell their products, taking pre-orders and selling merchandise. For companies looking to raise $50,000 to $10 million for their product, service or B2B business, they have the equity program that allows them to seek investment from accredited investors.
It is free to create a company profile and $179 per month to fundraise. There are no success fees but for rewards-based raises there is a processing fee of 3.5% + $.30 per transaction.
With WeFunder you can raise between $50,000 and $50 million from investors. Most campaigns take between one and three months to reach their goals. From a small restaurant to tech startups, you will be able to solicit funds from more than 150,000 WeFunder investors.
It is free to create a WeFunder profile and they don’t charge management or transaction fees. Administrative fees are charged to investors to cover all the costs of operating WeFund.
SeedInvest works to high-growth, professional and early-stage companies to raise either preferred equity or convertible note funding. For priced rounds of equity, you will need to provide the pre-money valuation. For convertible notes, you will need to provide the valuation cap, conversion discount, interest rate and term length.
To use SeedInvest, you will need to create an application, make it through the screening committee and conduct your due diligence before making a profile. This a platform for companies ready to make it big and you should expect the process to take a minimum of 60 days to complete.
There is a 7.5% placement fee charged on the total amount raised and it’s only paid on the successful completion of your campaign. You can also expect a %5 warrant coverage based on the amount raised and up to $10,000 in due diligence, escrow, marketing, and legal reimbursement expenses.
Fundly advertises on their homepage that they “raise money for anything” with no raise requirements and startup fees involved. They funded everything from personal health needs to politics and even trips. Simply create a page, manage your campaign from the Fundly app and use Fundly’s Facebook OpenGraph to maximize your reach.
There is no minimum amount you need to raise to keep the money you have raised, payments can be withdrawn within 48 hours of a donation and automatic transfers can be arranged.
Everyone pays a 4.9% platform fee plus a 2.9% credit card process fee and $.030 per transaction (depending on your country).
With LendingClub you can get a personal loan of up to $40,000 and business loans up $300,000. LendingClub is not a bank rather they connect borrowers with investors. Investors purchase notes that correspond to fractions of loans, in exchange for some solid returns. LendingClub facilitates every transaction and screens all borrowers. When you have a business loan through LendingClub you will get your capital upfront on one to five-year terms with no monthly payments and prepayment penalties.
LendingClub is recommended for large, one-time expenses. It is also required that your business has been around for at 12 months, have annual sales of at $50,000, no recent bankruptcies and ownership of at least 20% of the business.
There is an origination fee of between 1.99 and 8.99% and totally monthly payments per $10,000 borrowed of between $227 and $955 with total annualized rates of 9.77% to 35.1%.