Crowdfunding
Crowdfunding is a process to raise funds for your start-up online. All you need to do is convince the people about your business idea. If they believe in it; they grant you the funds. Simple. Many industries in the country can benefit from the advent of Crowdfunding. Be it Creative products, new innovations or inventions. Crowdfunding will make it easier for the entrepreneur to raise funds. India’s Mahindra Group recently launched a platform called ‘Spark the rise‘. It lets people talk about their ideas and request a funding for the start-up.
Wikipedia’s definition of Crowdfunding says it is the practice of funding a project or venture by raising monetary contributions from a large number of people, typically via the internet. One early-stage equity expert described it as “the practice of raising funds from two or more people over the internet towards a common Service, Project, Product, Investment, Cause, and Experience, or SPPICE.” The crowdfunding model is fueled by three types of actors: the project initiator who proposes the idea and/or project to be funded, individuals or groups who support the idea, and a moderating organization (the “platform”) that brings the parties together to launch the idea. In 2013, the crowdfunding industry grew to be over $5.1 billion worldwide.
The Crowdfunding Centre’s May 2014 report identified the existence of two primary types of crowdfunding:
Rewards Crowdfunding: Entrepreneurs pre-sell a product or service to launch a business concept without incurring debt or sacrificing equity/shares.
Equity Crowdfunding: The backer receives shares of a company, usually in its early stages, in exchange for the money pledged. The company’s success is determined by how successfully it can demonstrate its viability.
Lending Based– It involves taking a loan from the people( repayable once the business gets established). Micro-finance website Milaap is one such platform.
Crowdfunding is a financing method that involves funding a project with relatively modest contributions from a large group of individuals, rather than seeking substantial sums from a small number of investors. The funding campaign and transactions are typically conducted online through dedicated crowdfunding sites, often in conjunction with social networking sites. Depending on the project, campaign contributors may be essentially making donations, investing for a potential future return on investment (ROI), or prepaying for a product or service.
Similarly to crowdsourcing, the concept from which it developed, crowdfunding’s success relies upon the ability to canvass a sufficiently large group of potential contributors. The idea is the same as that behind many fundraising campaigns: convincing enough people to contribute to reach a target figure.
Crowdfunding sites are sometimes referred to as platforms because they provide a venue for all aspects of a campaign, such as creation of the public interface, campaign and project tracking, a payment mechanism and disbursement of funds.
Most Indian Entrepreneurs usually possess the requisite skills to turn an ideas into a fortune. However, devoid of enough financial support, many such ideas fail to execute. To their rescue, a few Crowdfunding websites have been established in the country. Crowdfunding is in its nascent stage in India for now. However, It is quite popular in America and Europe.
Major CrowdFunding Platforms (websites) operating in India
Wishberry.in: Wishberry.in began its operations in April 2012. It is a crowdfunding platform for anything creative and out of the box. Their 8 defined categories are: Arts, Performing Arts, Events, Design, Technology, Publishing, Film and video and Food.
Founders: Priyanka Agarwal & Anshulika Dubey
Location: Mumbai
For Website Click here
Rangde.org: Rang De began its operations on 26 January 2008. . The inspiration for starting Rang De was the thought that the peer-to-peer lending model could be transformed to lower the cost of micro-credit. Rang De is a non-profit organisation. They earn a nominal commission of 1% on all the loans repaid by the borrowers.
Key people: Ramakrishna NK, Smita Ram
Location: Bangalore
For Website Click here
IgniteIntent.com: Ignite Intent was formed in April 2012. It is a platform where people can showcase their talents and tell the world about their idea and subsequently Get funded! IgniteIntent enables artists, teachers, filmmakers, business startups, musicians, designers, housewives, sports persons, journalists, researchers, writers, explorers, dancers, curators, performers and others to transform their dreams into a reality.
For Website Click here
Milaap.org: Milaap was formed in June 2010. The founding members of Milaap are- Jayesh Parekh, Rajiv Madhok and Vijay Sharma- shared a common vision i.e. to change people’s concept of giving and make it a personal, transparent and sustainable process. Milaap provides a platform for the poor, hard-working individuals in the country to raise funds. It does not charge any commission from the funds you lend on Milaap. Instead, Milaap charges its field partners a 5% fee for the funds raised.
Key people: Sourabh Sharma, Anoj Vishwanathan, Mayukh Choudhury
Location: Singapore, India
For Website Click here
Ketto.org– Ketto was launched on 15 August 2012. It is the brain child of Varun Sheth, Kunal Kapoor and Zaheer Adenwala. Ketto provides a platform where you can provide support for the causes you think are important. It was launched with the idea to bring a positive change in the society. Its partners and supporters include- Google Grants, KWAN, CAP India, DASRA social Impacts.
Key People: Varun Sheth, Kunal Kapoor
Location: Mumbai
For Website Click here
Many Indian Crowdfunding start-up’s like Fundmypitch , PikAVenture , Funduzz are in a nascent stage. Foriegn crowdfunding platforms like Kiva also have commenced operations in India. Few Indian hardware startup raise funds on foriegn crowdfunding platforms such as Project Fin. The Indian crowd funding platforms operate more with the non-tech part of the Industry, and we wish to see this changed over a period of time.
Other crowdfunding platforms are:
