There are many crowdfunding websites that help innovative entrepreneurs get their ideas off the ground, social investors bring about change, and financial startups raise money. Many businesses avoid complicated funding methods like bank loans or venture capital – making it harder and less likely to raise money.
Before a startup raises money, it needs to consider the different stages of funding and the best crowdfunding sites for startups. It might be advisable to raise money through crowdfunding as this is a less complex model for startups.
12 best crowdfunding sites for startups that can help you fund your startup
The website Kickstarter has been around for almost a decade and is probably the most well-known along with being one of the best crowdfunding sites for startups of all crowdfunding platforms, and it’s easy to see why!
Completing a successful Kickstarter campaign is not easy. It has to be approved by the site and meet their guidelines in order to be approved on the site. You can not just fund any project, you have to create something that people want and share that with your funding through Kickstarter! Your project must also fall into one of the curated categories such as games, film or photography, fashion design and so on.
Kickstarter is worth a try if you want to reach the largest audience possible. With over 15 million backers worldwide, Kickstarter has been very successful in supporting creative projects.
There are different categories of donations and therefore different rewards. These range from photographs to wearable health technologies for social causes.
There is a 5% platform fee for successful campaigns only. There is also a 3% + $0.20 per pledge payout fee; 5% + $0.05 per pledge under $10. Reward campaigns come with all-or-nothing funding.
Campaigns are accepted from 6 countries and from more than 20 million donors worldwide. However, the campaign acceptance process is a bit complicated. You need to comprehensively understand all the terms and conditions before you can run the campaign, and the success rate is one-third. The 2.9% payment fees are a drawback, but the all-or-nothing funding model that allows you to have no reset options if they do not meet their goals sets them apart from other crowdfunding sites.
When looking at a crowdfunding site, the name alone should give you an idea of what it’s all about – this site is for female startups and small businesses where they can fundraise. The founders created iFundWomen as a “fundraising ecosystem” that also offers marketing and other services for female startup owners. For women, iFundWomen can be one of the best crowdfunding sites for startups.
There is a 5% platform fee, rewards campaigns, a keep-what-you-raise funding campaign for startups in the US and 22 other countries with payment fees of 2.9% + $0.30 per pledge.
iFundWomen is a great place to get much-needed help starting your business. It offers free training in the “iFundWomen Method” of crowdfunding, which means businesses raise 27 times more money using this method than other methods.
Unlike rewards-based crowdfunding websites, iFundWomen lets activists keep all the money they raise. Of the money the site raises through funding fees, 20% goes back into supporting campaigns and services for women entrepreneurs.
The company offers a flexible funding model that lets you keep the money you raise, a commitment to reinvest in the women-led entrepreneurial community, and additional services like startup coaching and video production. Access is limited to activists in only 23 countries. Some of the information about success rate or customer experience is not fully shared with users.
GoFundMe is a crowdfunding platform that helps people all over the world to give their money to charity. It is an internationally recognized website that allows anyone to help others financially, no matter what country you live in.
Also Read: How Does Gofundme Make Money?
GoFundMe is not the right crowdfunding website for every type of startup, but for a person who wants to help people, animals, or people who are in trouble due to illness, emergencies, or other disadvantages, it is the best option.
With no sign-up fees, GoFundMe is a great platform for personal causes in the U.S. and offers the ability to keep all funds raised. Be aware that campaigns are much more difficult than on other platforms due to the huge size and low success rate. You need to make an extra effort with your backers to get people to see and invest in your project.
For startups in the US and 19 other countries, payment fees are 2.9 percent + $0.30 per pledge.
For traditional startups, there are limited opportunities and the success rate for fully funded campaigns is 1 in 10, but the focus is on nonprofits that are crowdfunded, there is a funding model where you get to keep what you raise, and no funding fees for personal causes in the US.
Although there are other equity crowdfunding platforms, Wefunder is a favorite among them.
Wefunder has a success rate of around 75% for its startups, but there are no exclusivity requirements. This makes funding for startups easier than ever before, and the site among the best crowdfunding sites for startups. Wefunder also offers resources and help to those who use it for crowdfunding – including mentoring, help with legal documents, and even investor support.
There is a platform fee of 7.5% for equity and debt campaigns. However, this only applies to startups in the U.S. and there is all-or-nothing funding.
Equity crowdfunding with accredited investors has more legal requirements than other types of crowdfunding. You should check your state’s laws to make sure there are no additional state requirements you need to know about before participating in equity crowdfunding.
Wefunder is best for startups that see venture capital in their future. Wefunder is not for small businesses that want to stay small and has more regulations than other crowdfunding platforms, but if you are willing to deal with all of Wefunder’s rules and regulations, the equity-based platform can be a great way to fund your startup.
The success rate for campaigns is quite high, lack of exclusivity and availability of resources for startups. On the other hand, the legal requirements are higher and there are many mandatory financial disclosures.
Fundable is a crowdfunding platform that caters specifically to businesses, small businesses, and nonprofits. It offers campaigns in various business sectors such as manufacturing. The 5% fee (only on successful campaigns) is another plus for entrepreneurs.
There is all-or-nothing funding for reward campaigns and keep-what-you-raise funding for share campaigns. Payment fees are 3.5% + $0.30 per pledge.
The platform offers a variety of ways to raise money. These include products such as clinical diagnoses, intellectual travel experiences in India and banking, food and beverage campaigns. There is also a ‘New & Noteworthy’ section where you can keep track of the latest activity on Indiegogo, as well as dedicated campaigns from employees or businesses looking to support other projects. They focus on supporting small businesses.
Wishberry is aimed at those looking to fund creative projects, and not just any projects. Art, comics, publishing, theater, and more – the site supports all types of creativity. You’ll often find Kickstarter features in the platform’s pledges, too! Backers receive rewards for the projects they fund with Wishberry, a popular website like Kickstarter for creative work.
Their focus is primarily on new creative projects. Their goal is to bring creative and innovative ideas to life and build a community of backers.
Indiegogo is a crowdfunding website and marketplace where people can raise money for their projects. However, Indiegogo is more than just a funding platform: after your project has been successfully completed, Indiegogo offers Campaigners – what we call entrepreneurs or inventors – the opportunity to increase the number of projects so that we can continue to raise funds. Which makes it a part of the best crowdfunding sites for startups out there.
Campaigners can sell their products directly through the Indiegogo network of consumers. The focus on physical products means a different approach than other, more general platforms like Kickstarter and GoFundMe that fund initiatives, campaigns, and ideas. Product innovation and the implementation of innovative ideas is their main focus.
FuelADream is a rewards-based crowdfunding platform. It focuses on “quality over quantity” as it says on their website. Instead, you have the option to choose between AON (All or Nothing) and KWYG (Keep What You Get). The platform also has a section FAQ for further explanation.
Crowdfunding platforms that have a large number of campaigns can face the problem of authenticity and genuineness. FuelADream has reduced the number of campaigns to address this issue. The ‘Crowd Favorite’ section lists only the most popular and most funded campaigns, giving you an alternative choice if needed. They are looking for creative ideas, causes, charities, events and community led activities. Their goal is to change traditional methods and make fundraising easier.
Ketto is a crowdfunding website for Indian donors. It offers campaigns for healthcare, education, personal campaigns and animal welfare. There are sections like “Urgently Needed Funds” and those that offer “Tax Benefits”. Successfully funded projects on the platform include helping with the Kerala floods in 2016 and giving bicycles to school girls in India. Their goal is to create awareness and social change.
Catapooolt is more than a crowdfunding platform – it provides options for advertisers of all levels to partner with investors, incubators, accelerators, mentors, and others. It also offers marketing, distribution, sales, and community support features. The platform claims that the combination of these features makes it so comprehensive that users can quickly fundraise within their network or use the site’s ecosystem for other purposes, such as starting their own business!
Milaap is a platform for individuals, non-governmental organizations, and social entrepreneurs to raise money for good causes. The website offers microloans in the form of peer-to-peer fundraising loans for people in rural and underserved areas. It is a popular crowdfunding site for personal and social causes. Milaap also provides assistance in running these projects with its expertise. They help low-income borrowers for social causes and businesses.
Crowdera is less known than other crowdfunding websites launched in India. Crowdera is completely free and does not charge any commission from those who launch campaigns. Thanks to its free nature and global presence, Crowdera is popular among many users who can raise money for their project from any country in the world.
The founders are the private backers of this crowdfunding platform which allows a wide range of target amounts ranging from a minimum goal of Rs 500 to a maximum goal of Rs 99,999,999.
There are a variety of funding options available for startups, with crowdfunding sites like Indiegogo being a major contributor. With more and more platforms available and more crowdfunding projects coming online every day, there is no dearth of funding options.
How to find the best crowdfunding sites for startups?
Crowdfunding portals are an effective way to connect small businesses with investors and other backers. It’s often difficult for small business owners to enter the market on their own, but crowdfunding sites that function like social media can give them access to multiple markets.
Best crowdfunding sites for startups can be divided into two main types:
Rewards crowdfunding: in a rewards-based crowdfunding campaign, you create a campaign for your startup. Then individual donors contribute money, usually in small amounts, to your campaign in exchange for some sort of reward. Rewards can be anything from pre-orders to website shoutouts to t-shirts.
Equity crowdfunding: equity crowdfunding is popular with startups because investors are willing to donate larger amounts in exchange for a share of the company’s business. This means we have more flexibility with our campaign budget and fewer reporting requirements, but it also requires us to treat donors like minority shareholders, with all the responsibilities that entails.
There are a variety of crowdfunding platforms. Some focus on one type, while others offer both types. Clicking “I want to contribute” allows you to keep the funds you raise if your campaign is successful; otherwise, the platform would take ownership of all funds raised by the project.
If you are starting a business, you can choose between different types of crowdfunding campaigns. GoFundMe is an example of one that does not necessarily involve rewards or equity investments, but works more like donations to charity, and Patreon provides income to artists and writers. The type of campaign you choose depends on your size, goals, capital needs, and how much money you want to generate.
If you plan to use cash for your campaign, equity-based campaigns are more effective. However, if you want to raise a significant amount of money and have many small donors participating in the crowdfunding process, rewards-based campaigns may be best.