Crowdfunding is about persuading individuals to each give you a small donation -- £10, £50, £100, maybe more. Crowdfunding connects investors and businesses to quick and easy business funding, and given that banks are hesitant in lending to small business, crowdfunding has become quite mainstream lately. Crowdfunding has boosted innovation and increased opportunities for social ventures, the arts and business people to expand their horizons.
Crowdfunding has also been used a lot in the music industry, from recording music to funding tours. According to the UK Crowd Funding Association, the world's first online crowdfunded project was believed to involve British rock band Marillion. In 2014 Crowdfunder ran a campaign to raise enough money to bring The Foo Fighters to Cornwall.
The Crowdfunding Centre's May 2014 report identified the existence of two primary types of crowdfunding:
Pre-selling a product or service to raise funds for a business, community or non-profit venture without incurring debt or sacrificing equity/shares. Rewards crowdfunding has been used for a wide range of purposes, including motion picture promotion, free software development, inventions development, scientific research, and civic projects
The backer receives shares of a company in exchange for the money pledged. The company's success is determined by how successfully it can demonstrate its viability. Raise funds for anything, from products to personal projects