Tag Archives: GoFundMe

Funding the crowdfunding sites

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.