The crowdfunding revolution is just getting started, and this brave new world of online fundraising has the power to radically change the economy.
Look at how much funding past projects have generated, or how much money has been raised online by projects that aim to affect positive change. Now consider what has happened to the cost of doing business over the last decade, and how much less businesses have to spend on labor in order to compete with their peers from increasingly interconnected economic regions.
Crowdfunding is going to change the way we do business, to be sure, but it’s also going to change the way we work. It’s an incredible resource that has tremendous potential for helping worthwhile projects get made.
It’s also a boon for small businesses in terms of marketing, and just the fact of being able to access new markets.
The following are ways in which crowdfunding will change the capital market in the coming years.
● Crowdfunding will help companies lower the costs of capital
You don’t need $1,000,000 in venture capital to start a company. You don’t need $10,000,000 in stock grants or debt financing. Start-ups have been able to raise money from equity investors and take advantage of government tax benefits available to corporations for several decades now.
But increasingly businesses are going beyond that and focusing on the lowest cost source: their customers.
● If you have an idea for a product and want to launch a business, why would you ask people you don’t know to give you money? Wouldn’t it make more sense to ask the people who know your business best — your customers — for help? That’s what crowdfunding is all about.
● There’s another advantage: companies that launch successful funding campaigns on platforms like Ideazon can often attract investors who want in on the ground floor. Investors and entrepreneurs can be in regular contact, often meeting up at work functions.
The whole process is more like a dialogue than a “business plan competition.” Think of it as selling equity to your friends and family with the help of your network.
So next time you’re at a company party or gathering and hear someone mention they’re trying to raise $100,000 for their business idea, listen carefully — it could be the start of a fundraising campaign.
● Crowdfunding will give small businesses access to capital they never had before. Small companies currently don’t have access to capital in the same way as large corporations.
They also don’t have access to the same range of investors. Many competitors are not even close to having the resources to fund their growth: they need help.
But now that crowdfunding is here, small business owners can tap into a powerful network of potential investors who know their business best.
● Crowdfunding will change the way we think about business financing.
There used to be a time when business owners sought funding from sources outside their own networks in order to build more relationships. With crowdfunding, the crowd is literally all around you.
Every person within your network can become an investor and an advocate for your company. The amount of capital at hand for each business is virtually unlimited, because you don’t have to look any further than your network for help (in fact, you can’t).
At Ideazon, we help you take advantage of the benefits of crowdfunding and the power of your network. We’re the best online platform for crowdfunding and you can start making your ideas a reality today by signing up with us.
