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What is crowdfunding or participatory financing

Even if you’ve never heard the term “crowdfunding”, you’ve probably encountered it on social media. Crowdfunding simply refers to raising funds or capital online for a project or a cause from a large number of people or investors. Natural persons or small enterprises can use this type of financing to obtain material or capital support in their effort to develop an idea or a business in its early stages. In general, there are three types of crowdfunding: reward crowdfunding, debt crowdfunding and equity crowdfunding. Reward crowdfunding means that you raise funds for your idea by contacting your followers or fans who receive a small gift or sample products if they promise to invest a certain amount in your idea or business. In what concerns debt crowdfunding, you receive a loan that you pay back within a certain term. Some people prefer to use debt crowdfunding instead of a bank loan, because it’s faster and more efficient. And last but not least, equity crowdfunding or participatory financing means that you offer a part of the ownership in or a part of the shares of the company or business to those that provide financing.

Popular crowdfunding platforms

Here are some of the best crowdfunding platforms currently available on the internet for financing various businesses or projects:


Kickstarter is one of the largest crowdfunding platforms available. It is renowned for helping technological and creative entrepreneurs finance their projects prior to obtaining a loan or raising money for their working capital. The company managed to raise over 5.6 billion dollars, with over 197,425 projects (up till January 2021) financed since its launch in 2009. Potential financers can navigate through a series of fields, from art and film to advertising and many more. The platform is easy to use when it comes to raising funds.

Start by setting an objective and an interval for its achievement. FYI: prior to launching your campaign, you need to be approved by Kickstarter. For each level of money raised per person, you have to offer a small gift or personal experience to your donor. Kickstarter is an all-or-nothing type of platform, which means that you won’t receive the funds unless you complete the campaign. It also means that the financer’s credit card won’t be charged unless your campaign achieves its objective. The fee is 5% higher than the payment processing fees (3 to 5%) per transaction. If you raise enough money, there’s a waiting term of 14 days until you receive the funds in your account.


Causes is the largest online donation platform in the world that focuses on social, political and cultural issues. It is a social network for people who want to make a difference quickly and efficiently. It has over 186 million users from 156 countries. The platform is great for non-profit organisations that wish to build a community of donors without spending too much money and resources. Causes uses advertisements, but it’s free of charge for its users. On your crowdfunding page, you can collect donations and promises, you can raise awareness and share relevant media information with the potential donors. Apart from raising funds, Causes is also a social platform that enables you to find people with common interests, as you search through categories such as animals, human rights and the environment. Furthermore, Causes provides a platform for creating advocacy petitions. It is not exclusively intended for registered non-profit organisations; natural persons can also access the platform and raise money for various programs and ideas they are interested in.


Patreon is popular among those working with digital services such as YouTubers, podcasters and bloggers. As opposed to collecting unique donations for a certain campaign, this platform offers a template subscription by means of which clients contribute with a fixed amount every month. The platform enables artists to develop relationships with their fans, while creators can even deliver exclusive content to their Patreon subscribers as an incentive to continue to finance them. This service works best if you regularly share your work on your personal platform. Otherwise, commissioners have the right to cancel their subscription if the creators fail to produce content. Patreon charges a fee of 2.9% and 30 cents per subscription. The platform has two million active subscribers and over 200,000 active creators. One of the disadvantages of Patreon is that it doesn’t market creators as much as other platforms, such as Indiegogo or Kickstarter, which have dozens of categories of advertisements and pages for their projects that donors can navigate.


You’ve probably seen many GoFundMe crowdfunding advertisements on social networks. This platform charges a processing fee of 2.9% and 30 cents per donation. Since this is not an all-or-nothing type of platform, you can keep all the money you raise. Furthermore, there are no fees associated with the financing of a personal campaign for those living in the United States. GoFundMe has had many successful campaigns, including the Las Vegas Victims’ Fund (11.8 million dollars) and the Time’s Up Legal Defence Fund (24.2 million dollars). This platform represents a good option if the raising of funds is directed towards a service-based cause, such as medical needs or emergency assistance. However, there are a few warnings you have to consider: there is a possibility that conventional start-ups won’t raise as much capital on GoFundMe and it’s important to remember that only one in ten campaigns is financed.


If you create a consumer brand, it’s worth looking up CircleUp, which has contributed to raising 390 million dollars for 256 start-ups. The platform offers both capital and loan financing. It also provides a network of experts, retailers and entrepreneurs. You can also get in touch with accredited investors with a net value of at least 1 million dollars and an annual revenue of at least 200,000 dollars. Other advantages include the access to special lines of credit and market information using Helio, the learning technology that own Circle Up, which uses machines to develop the company’s strategies. The platform is recommended to entrepreneurs that wish to grow, rather than develop their ideas. The selection process is pretty competitive and, in general, you need to have a revenue of at least 1 million dollars to be listed on the platform.


Lending Club is a crowdfunding platform that offers up to 40,000 USD in personal loans and up to 500,000 USD in business loans. It is a debt crowdfunding platform that works faster than requesting a bank loan. As opposed to the majority means of participatory financing, the platform doesn’t require business meetings or plans and projects. With LendingClub you can receive a 1-year or 5-year loan, according to its website. The interest rates can be higher depending on your loan score – usually, the total annual interest rate varies between 12.15% and 29.97%. LendingClub requires the business to be at least one year old, to have 50,000 USD in annual sales, to have no record of recent bankruptcy or unpaid taxes and for the applicant to own at least 20% of the business. In other words, it requires the business to be in good financial health.


This online platform helps natural persons, non-profit organisations and companies finance their causes through crowdfunding. It allows both the keep-it-all and the all-or-nothing types of fundraising, which means that you won’t have access to your funds until you achieve your objective. Natural persons can opt for a fundraising template with no platform fees for organisers (supporters can request additional advice), while organisations can opt for a “professional” template with a 5% platform fee.


With Fundly, natural persons or non-profit organisations can organise digital fundraisers for a wide range of causes, including fraternities. A platform fee of 4.9% will be deducted from every donation, as well as a payment processing fee of 2.9% and an extra 30 cents.


If you wish to develop an existing business, WeFunder can help you obtain financing. Your investors receive a small stake in your company. To create a company profile, the platform charges a service fee between 7 and 75 USD, depending on the size of the investment and 7% from the total financing for the Crowdfunding Regulations. For D Regulations, the platform charges up to 20% interest rate, while for A+ Regulations, WeFunfer doesn’t charge any fees.


As a participatory financing platform, Seedinvest enables start-ups to raise funds from individual investors and venture capital firms. The entrepreneurs have to achieve their minimum financing objectives in order for the investments to become final. Fees: a placement fee of 7.5% with a guarantee coverage of 5% or equity, plus a fee that varies between 0 and 10,000 USD for guarantee refund, marketing and legal expenses.



This crowdfunding platform helps engaged couples or newly-weds that are entering the next stage of their lives raise funds for a wedding, a honeymoon or even a down-payment for a new home. You need to register for gift cards and the Honeyfund balance, and you’ll be charged 2.8% + 0.30 USD for the bank deposits.


Slated is a participatory financing platform for films. It helps finance film projects, find talents and distribute the final project. Moreover, it provides the option of extended services, such as screenplay and financial analysis, at an additional cost. The service fee charged for executive producers is between 2% and 10% of the project’s budget and between 5% and 10% of the back-end after refund, plus 20%.


Experiment is a participatory financing platform focused on scientific research. It helps researchers raise funds for new discoveries and technologies. The supporters can revise their contribution through open access to data and journal publications. Fees: platform fee of 8%, plus 2.9% + 0.30 USD payment processing fee. It provides an all-or-nothing type of fundraising.


The success or failure of a fundraising campaign for your project through crowdfunding platforms depends on many factors. Thus, it is advisable to place this task in the hands of professionals who are familiarised with these platforms. They can help you get very good results in your endeavour. Our agency has vast experience in crowdfunding campaigns and we’ll certainly be able to turn your dreams or projects into successful businesses.