Tag Archives: crowdfunding

Funding the crowdfunding sites

Commentary
Raising money through crowdfunding sites is rapidly gaining traction. According to sources, there are now hundreds of crowdfunding sites online, each one determined to get a slice of this fast growing industry. As stated by the Crowdfunding Industry Report by Massolution, an estimated $2.7 billion was raised in 2012, and as much as $5.1 billion was raised in 2013. In addition, according to a 2013 study commissioned by the World Bank, the global crowdfunding market could reach between $90 billion and $96 billion by 2025. To date, platforms like Indiegogo, GoFundMe and Tilt (formerly Crowdtilt) have become the favourite platforms of investors. Last week, previously bootstrapped GoFundMe raised an undisclosed amount of money which now values the company at around $500 million. Tilt, in its most recent funding round, received $30 million at a $400 million valuation. So why are investors enthusiastically getting behind crowdfunding platforms? The answer is simple: the average campaign raise on a crowdfunding marketplace far exceeds the average item price on most consumer marketplaces, meaning commissions generated per item (campaign) are significantly larger. We feel there could be a few large acquisitions, IPOs around the corner within this space.

Is Teespring the future of apparel?

Commentary
They say that necessity is the mother of invention, and the rapid growth in the number of startups in the US market saw a need for innovative forms of early stage funding. Today, crowdfunding is disrupting the finance community by giving entrepreneurs opportunity to generate funds directly from a large pool investors, providing a feasible alternative to traditional funding sources such as banks and venture capital. While crowdfunding isn’t for everyone, the financial model is quickly catching fire and has spawned countless niche platforms that focus on raising funds for sectors such as, real estate, healthcare, charity and tech startups. One of the more popular tech businesses that leveraged the crowdfunding model is t-shirt company Teespring. What makes Teespring unique is it allows users to create and sell custom-designed

t-shirts without any upfront costs. The user can design a t-shirt and sell it online and the money generated from the sales will be used to pay for the production of the t-shirts and shipping. The business model is so effective that the company has sold six million t-shirts this year alone and claims to have turned at least 10 people into millionaires.

Today, the company received a massive $35 million Series B from Khosla Ventures.You can read about the funding here.

Crowdfunding fuels Olympic dreams

Commentary

Crowdfunding fuels Olympic dreams

What does it take to pursue an Olympic dream? It takes perseverance, commitment to excellence, discipline and lots of cash. The truth is, the cost of joining the Olympics is quite high. Athletes have to pay for training, equipment, travel, physiotherapy and daily living expenses. To get funding, most athletes rely heavily on sponsorship money in order to train. The more enterprising ones go to the Internet for support, specifically to crowdfunding websites to seek the much-needed funds.

There is a growing trend of crowdfunding sites that allow people and startups in need of cash to raise funds from a large pool of donors. It’s no secret that the 2-man Jamaican bobsled team has raised more than $115,000 from crowdfunding platforms Crowdtilt.com and Indiegogo.com. Canada’s Alpine skier Larissa Yurkiw used crowdfunding platform Pursu.it.com and raised $22,476 from more than 2,000 fans. In the US, ski jumper Lindsey Van raised over $20,000 via RallyMe.com, a crowdfunding site specifically focused on sports.

Given the funding success of these athletes, crowdfunding could play a bigger role in future Olympic games.