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How to shop for crowdfunding sites
If you're looking for a crowdfunding site to run your campaign, you have plenty of platforms to choose from.
There are so many it can be a challenge to decide which crowdfunding site is the best fit for your project.
If you are looking to raise money for a project or cause and don't want (or can't) offer supporters equity in your company, the firms listed below may be a good option. However, if you are an investor looking to lend money or buy equity to startups and small companies, visit our marketplace investing page.
How should you compare crowdfunding sites?
SuperMoney's crowdfunding comparison tools can help you filter out the platforms that offer the fund-raising features you need at the best prices.
These are some of the questions you should consider when comparing crowdfunding sites.
What types of campaigns is the crowdfunding site designed for?
The best features and rates are worthless if a crowdfunding site doesn't support your type of campaign. For instance, some crowdfunding sites, such as Indiegogo and Kickstarter focus on creative projects and don't support charitable campaigns. Other sites, such as Razoo, specialize in nonprofit fundraising.
The major campaign types include:
- Creative projects (e.g. music, video, and journalism projects)
- Technology and hardware products
- Charitable campaigns
Does the platform have an 'all-or-nothing' policy?
Funding requirements vary widely by crowdfunding site.
Some platforms operate on an all-or-nothing funding system, only making payouts if the full request amount has been pledged – and only after the campaign has ended. Others employ a “pay as you go” model, making credit and debit card payouts as they are received, even if the project fails to achieve its entire funding goal.
The benefit of the "all-or-nothing" model is it can motivate supporters donate more to meet the goal. This is great if you're trying to raise funds to launch a product that requires a minimum investment to be viable. But it's a terrible feature if you're raising money to pay for medical expenses or fund a vacation.
What fees do they charge?
Almost all crowdfunding platforms impose some type of fee for the use of their services. Most collect fees as a percentage of donations pledged, which means users must take fees into account when setting funding goals. Some platforms collect reduced fees from nonprofit organizations or from campaigns that meet or exceed their funding goals, while others waive fees for campaigns that fail to meet their funding goals.
How much does it cost to set up a campaign?
Most crowdfunding sites don't charge a fee to set up a campaign. However, they generally charge either a platform fee or a payment processing fee once you receive the funds.
What funding options do they offer?
Many crowdfunding platforms allow donors to make contributions through multiple vehicles. Common options include money transfer services like Stripe and PayPal, as well as through credit and debit cards or even online checks.
What features and customization options do they offer?
Most crowdfunding services allow users to create custom URLs for their campaigns that can be shared with friends or posted on social media platforms. Some services allow users to integrate their campaigns into their own websites. Other useful features include dedicated mobile apps or mobile-friendly websites that allow users to monitor their campaigns on the go. Savvy users appreciate crowdfunding platforms that include user analytics to illustrate the reach and effectiveness of individual campaigns.
What rewards are available to users?
Most crowdfunding sites include provisions for rewards – perks or gifts that people or organizations running fundraising campaigns provide to donors in exchange for pledges. Rewards can be relatively inexpensive, such as t-shirts, or lavish, such as backstage access to productions in progress. While rewards are usually not required, donors have come to expect them, and campaigns that don't offer any rewards are much less likely to be successful.
What do the reviews of other users have to say about their customer service?
Low fees and powerful marketing features are important, but the biggest differentiator among crowdfunding sites is probably their customer service. Check SuperMoney's free community reviews before you make a decision.