Crowdfunding for Capital? Know the Rules.

General Business

July 05, 2016
by Paul Ouweneel, CPA, CFP, CFA

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Paul Ouweneel Paul Ouweneel, CPA, CFP, CFA

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Consider the traditional approach to securing business financing: Armed with your valuable idea, a sound business plan, and some marketing research, you strive to get an audience with some wealthy investors, perhaps angel funds, a venture capital firm, and a few investment banks. You spend a great deal of time and effort pitching to this very limited pool of capital investors, with uncertain success. 

Now consider a current popular approach called crowdfunding: You pitch your valuable idea and supporting business plan and research out into the world via social platforms and media. 

Crowdfunding is a method of raising capital through the collective effort of friends, family, customers, individual investors, even complete strangers. The method taps into expansive pools of potential investors primarily through social media and other crowdfunding platforms, letting business owners, in essence, make their pitch to the world.

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