Why Support Crowdfunding Projects
Crowdfunding has risen as a favorite of the start-up scene. First time hearing this term? In a nutshell, it’s where one company or an individual has an innovative idea (usually for a product) and launches a campaign to fund its creation. These initiatives need help because the capital to produce a physical product can be hefty and includes many stages, including prototyping, testing, manufacturing, and logistics. This launch model is often a win-win for the new company and its backers, who get a bunch of great benefits:
Order new innovations at a fraction of the cost
Products that utilize the crowdfunding platform are usually innovative, new products that have never been heard of. You never know if the product you are backing is a future trend or tech essential. Since the company is still building its foundation and needs as much funding as they can to get started, you’ll be rewarded with their best price. These prices generally go up by 20-70% after a crowdfunding campaign. So if you see a product that you love, we recommend placing your bets in its success as this could end up being a very sweet deal for you. You will never see that price that you were able to secure again.
Help achieve the unthinkable
Since the products most often seen on crowdfunding platforms are innovative, it can be easy to think “is this product even possible to create?”. However, many successful crowdfunding products have grown into full-fledged companies. If we are looking at statistics, currently about 78% of crowdfunding products exceed their goal and become successful in delivering a polished product to backers. By joining other backers, you become part of something bigger.
Purchase low-cost shares
You may support a campaign you love by pledging an amount and getting a product/service in exchange. If you believe in the success of the innovation you backed and have the extra cash to invest, some crowdfunding startups also accept investors, allowing you to purchase shares at the lowest possible value. This can turn out to be a really wise money move if the company grows and you’re able to receive a huge return on investment when you sell your shares.
Support your local economy
Startups and small businesses fuel the economy in various ways. Small businesses create new jobs. A small business can grow into a large company and drastically impact the money coming into a community. Generally, there is also a “ripple effect” that happens as it often provides opportunities for other businesses as well (ex. outsourcing logistics to a local shipping company).
Help someone’s dream come true
Todd Stocker summed it up well when he said, “helping others is the secret sauce to a happy life.” It is scientifically proven that helping others increases happiness. As you build social connections, you can increase your self-esteem and decrease your stress. In short, when you do good, you feel good.
If this is your first time trying out crowdfunding, back something you are passionate about and keep an eye out for substantial proof that the company you want to support will be able to make their promises a reality.