Have you heard about the sensational Kickstarter success story behind the "3-D drawing pen" 3Doodler? Two entrepreneurial toymakers set out to raise a modest $30,000, and then watched, astonished, as their project garnered over two million dollars.
Watch the video if you haven't -- it's delightful. And since our month's focus on fundraising is just about to wrap up, I thought I'd do a basic overview on crowdfunding.
In recent years, crowdfunding gained a lot of visibility through the platform Kickstarter, famous as a social network that invites regular users to "fund" the projects of favorite musicians, films and other creative projects. What many people don't know is that crowdfunding has been used successfully for funding small business, and as more businesses try it, new fundraising platforms are proliferating.
Crowdfunding is just a new twist on "passing the hat." To crowdfund a project, you create a page online and ask for people to contribute funds, usually for token rewards or prizes. While crowdfunding has been long-associated with films, music and creative projects, its use by entrepreneurs is growing all the time. And while Kickstarter and Indiegogo are major players in the space, all one needs to create a crowdfunding campaign is a WordPress site and a method to collect payments online like PayPal.
Here's an introduction to crowdfunding.
Photo by Flicker user Tax Credits