Crowdfunding platforms come in many flavors. Equity Raisers specializes in equity crowdfunding, but there are many more options when it comes to choosing a crowdfunding platform. Rewards-based crowdfunding is the most common type of crowdfunding option available. This type of crowdfunding involves setting varying levels of rewards that correspond to pledge amounts. A standard rewards campaign offers at least three levels of pledges/rewards.
Equity crowdfunding is on the rise after the signing of the Jumpstart Our Business Startups (JOBS) Act in April of 2012. Equity crowdfunding is the exchange of actual shares in a private company for capital. In this form of crowdfunding, entrepreneurs can set investor caps, minimum pledge amounts, etc. as well as approve or deny investors who wish to view their business documents.
Equity campaigns are typically several months or longer in length and fit well with startups seeking $10,000 or more in funding.
Donation crowdfunding is exactly what it sounds like – the campaigns amass donations without being required to provide anything of value in return.
Lending based crowdfunding allows entrepreneurs to raise funds in the form of loans that they will pay back to the lenders over a pre-determined timeline with a set interest rate.
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