CHAPTER 1
Introduction
You need capital to start a business. How do you get the funds to buy inventory, launch a marketing campaign, and set up shop? In the last few centuries, businesses have nearly always relied on their immediate networks. Funders may include an uncle, a noble, or a local bank. There are few alternatives for those without a big pile of cash. Things started to change a few years ago. Entrepreneurs and artists started to receive funding in small amounts from a great number of people often outside of their network. Instead of getting one large loan from a bank officer, entrepreneurs solicit the funding directly from the public, in large part from people whom they do not know. As a result, you may see something like 1000 people giving $30 each instead of a $30,000 loan from a single bank officer. This is called crowdfunding. Think of it as a “Pennies from Many� model. Projects are typically funded on crowdfunding platforms, the two most popular being Indiegogo and Kickstarter. Each platform operates sets different rules. Some allow you to keep all the money you raise, while others will only give you the money if your project is fully funded; some are pre-dominantly focused on creative projects and business ideas, while others are more suited for personal ventures.