Third Quarter 2013
Opinion Panel Survey - Crowdfunding
Crowdfunding – the use of small amounts of money from a large number of people to finance a new product, venture or business – has quickly become a hot topic among entrepreneurs and business owners. In today’s economy, some small businesses are struggling to stay afloat and entrepreneurs are facing financing challenges of their own. Crowdfunding offers these individuals a chance to showcase who they are and what they offer to the world instead of or in addition to traditional funding options.
In Q3 2013, we asked our Small Business Opinion Panel about their familiarity with and feelings about crowdfunding. While not a scientific sampling, our panel indicates that the majority of small business owners are unaware of or only moderately familiar with crowdfunding.
We asked those familiar with crowdfunding if they feel it will become a successful way to fund new business. The majority of our panelists say they are uncertain of the future of crowdfunding.
According to our panel, 79% of respondents said that campaigns should ask for more money than is needed for the project. However, Matt Cooke, Crowdfund Buzz founder, advises knowing your funding needs for a project and only asking for that amount. Once you reach your goal, you may quickly get to 200-300% of those goals. Aim to hit your goal early, and then go for above and beyond. Additionally, Cooke has seen that sectors or products that offer something tangible tend to do well when compared to those that do not offer a backer something tangible. Most of our panelists agree with that statement.
Crowdfunding may not be a viable option for all businesses or Startups. Business owners need to be aware of other funding options, several of which are available for every type and stage of business.
- Angel Capital Group
- Heartland Business Capital
- Invest Midwest Venture Capital Forum
- Justine PETERSEN Microloan Program
- Mid-America Angels
Have questions about crowdfunding or other financing options? Give us a call at 816-235-6500, we’re happy to help connect you to the right resource for your business needs.