Crowdfunding is a financing form that’s come to the fore in the last two of three years, largely because of one company, Kickstarter.
Simply put, rather that relying on banks or venture capital for funds to start or expand, firms take to the internet, through Kickstarter and a bunch of similar sites. Crowdfunding has also grown beyound its original roots in the artistic community, and now will include funding for about anything.
Long preamble, but Catherine Clifford, writing in entrepreneur.com, has actually come up with a list of best practices for crowdfunding, most of which go back to planning ahead, being pretty specific about your project, who gets how much for what money, and the use of the proceeds. The link is at http://www.entrepreneur.com/article/226182.
Honestly, we didn’t see any real weaknesses in Catherine’s article, other than a lack of specificity about whether most of the action has come to startups or those companies who are already going and need an injection of cash in return for a minority share, in order to grow.