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Crowd·fund·ingˈkroudˌfəndiNG/nounthe practice of funding a project or venture by raising many small amounts of money from a large number of people, typically via the Internet."musicians, filmmakers, and artists have successfully raised funds and fostered awareness through crowdfunding"

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Crowdfunding is quickly becoming the largest source of equity investment for startup

projects

Eliminating the need for traditional investors in order to

raise funds…

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Allowing the creator to retain

creative freedom of their

project

Two main crowdfunding models: donation-based where users offer goal based funding in exchange for rewards or perks, and investment

crowdfunding where investors receive shares in the business

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Three main crowdfunding sites:•Kickstarter (Donation-based individual project investment)•Indiegogo (Donation-based campaigns for anything)•Crowdfunder (Investment based for startup companies)

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Kickstarter has been used to successfully fund 62,326 unique

projects a total of $1,129,470,573 since its creation

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Indiegogo has been used to successfully fund 44,498 unique projects a total of $193,000,000

since its creation

There have been many hugely

succesful crowdfunded

projects such as:

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The Oculus Rift virtual reality headset which received nearly $2.5M in funding from over 9500 backers

The Pebble E-Paper watch for iPhone and Android received

nearly $10.3M in funding from over 68,900 backers

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The Ouya video game console received nearly

$8.6M in funding from over 63,400 backers

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However not all projects are meant to be

In fact only roughly 40% of Kickstarter campaigns and 30% of

Indiegogo campaigns are successfully funded

Of the 81,006 unsuccessfully funded campaigns on Kickstarter:•13,649 were 0% funded•51,922 were 1%-20% funded•9,903 were 21%-40% funded•3,712 were 41%-60% funded•1,252 were 61%-80% funded•568 were 81%-99% funded

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It is clear that crowdfunding is the

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So it will be interesting to see if traditional investment

methods adapt

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Or become obsolete in the coming years

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Sources:Oculus Rift: Step Into the Game. (n.d.). Kickstarter. Retrieved May 24, 2014,

from https://www.kickstarter.com/projects/1523379957/oculus-rift-step-into-the-gameBarnett, C. (2013, May 8). Top 10 Crowdfunding Sites For Fundraising. Forbes.

Retrieved May 24, 2014, from http://www.forbes.com/sites/chancebarnett/2013/05/08/top-10-crowdfunding-sites-for-fundraising/

KICKSTARTER. (n.d.). Kickstarter Stats — Kickstarter. Retrieved May 24, 2014, from https://www.kickstarter.com/help/stats

. (n.d.). . Retrieved May 24, 2014, from http://www.crowdfundbeat.ca/wp-content/uploads/2013/10/crowdfundersinfograph.jpg

Pebble: E-Paper Watch for iPhone and Android. (n.d.). Kickstarter. Retrieved May 24, 2014, from https://www.kickstarter.com/projects/597507018/pebble-e-paper-watch-for-iphone-and-android

OUYA: A New Kind of Video Game Console. (n.d.). Kickstarter. Retrieved May 24, 2014, from https://www.kickstarter.com/projects/ouya/ouya-a-new-kind-of-video-game-console

All Images used are under the Creative Commons license from flickr.com