What is crowdfunding?

Crowdfunding is a way for individuals and businesses to raise money from a group of people without the involvement of a bank. This is usually done online by posting the project on social media platforms or websites. As it were, crowdfunding is a way for companies or individuals to raise money from the general public (crowd) for a project It is also a great way to find new products and services and it can help entrepreneurs succeed in making their business plan come to life.

Common forms of crowdfunding include funding for websites, apps, music, film, literature, social causes, real estate and food products. Funding can also be transferred directly from one person to another via cryptocurrency. Some crowdfunding platforms are only open to individuals living in certain countries, such as the United States or the United Kingdom. There are also ways to sponsor academic research through crowdfunding. This can also take science another step forward

Does crowdfunding cost money?

Setting up a crowdfunding campaign is often completely free. This is because crowdfunding is a donation platform. If you want to start a crowdfunding, you can sign up with one of the crowdfunding platforms If money does have to be paid, this is about an interest amount of the money raised. This interest rate is usually between 6% and 9%, depending on the market of course.

Investing in crowdfunding

Many people choose crowdfunding because it is often thought that this way of investing involves less risk than investing in funds or stocks. According to the AFM (Netherlands Authority for the Financial Markets), this thought is unjustified. According to them, people often trust crowdfunding investing blindly without doing proper research on the risks themselves. For example, they advise never investing more than 10% of your investable capital in crowdfunding