What is Crowdfunding?

Internet sharing heads the list of the most important concepts that add to the life of the Internet. This feature, which is defined as an “open source” application, is of great importance for the creativity and development of the software industry, has introduced many sharing services, applications such as Facebook, YouTube, Instagram, Twitter, and instant sharing are examples of services that affect the physical and economic dimensions of our lives.

 

 

Below, we will examine two major examples of Crowdfunding.

 

A U.S.-based, nonprofit, individual funding system, is an alternative system of raising money through donations.

This service, which is usually used by independent producers, takes advantage of artists and inventors in 13 diverse fields, including comics, dance, design, fashion, film and video, food, games, music, photography, publishing, technology and theater. In 2014, 22,252 projects were financed on Kickstarter.

In the U.S., Kickstarter receives a commission of 5% if funding is requested by entrepreneurs. In addition, people who request funds as a system registration must meet the following conditions:

• Be at least 18 years old
• Be an American citizen and have a Social Security Number
• Have a bank or credit card belonging to a bank in the U.S.
• Reside in the U.S.

Working logic

The ideas and projects that are believed to be creative are prepared and uploaded to Kickstarter. During this time, the amount of money required for the transfer of the project and the documents are prepared (video, visual, picture, writing, etc.).

If the proposed project proposal is seen as a creative suggestion by Kickstarter, the project will be published. In this phase, the aim is to collect the determined budget from those whom the system calls the guarantor within a certain certain period of time (1-90 days). If the specified budget can be collected within the specified time period, the site receives a 5% share. In this way, the entrepreneur is able to bring his project to life.

If the project budget cannot be collected, money will not change hands. (This is because the donor is not the donor but the guarantor, because the funds are not withdrawn from the donated card until the project target number is reached.) In this case, no one gets money. At the end of the process, the ownership of the product remains 100% that of the project creator.

Kickstarter is not a way of “begging for money:” it is direct marketing. So, regardless of the amount of money given, all donors receive some form of recognition, whether in the form of a sample of the product itself or a thank you letter. In addition, if you donate as much as you can donate donations at certain stages so that you are the gift if you do more than x.


A platform based on a structure like the Kickstarter is a mass-funding mechanism that operates globally. The indiegogo platform, which became the second most popular site in the world after Kickstarter, was established in San Francisco in 2008.

The initiative which has raised the most funding is indieGoGo, which operates in all areas of dance, art, music, technology and the like, as in all mass funding mechanisms, belongs to a technology company which raised $12 Million.

The major difference between IndieGoGo and Kickstarter is that with Indiegogo, the amount collected is transferred even if the fundraising goal is not reached.

Indiegogo’s most popular campaign is “Save Greece.” The fundraising goal of this campaign was 1.6 billion euros, half a million euros of which was raised on the first day alone. To date, “Save Greece” has raised 2 billion euros, and there is no time limit on this campaign.

Working logic

A special software algorithm is used in Indiegogo to check the accuracy of information given about the projects. The project ideas can remain on this platform for 60 days. Within this period, those who desire can donate to the project through bank channels.

In order to use this service, you have to be at least 18 years old. If stolen ideas are detected, they are removed from the platform. Drugs, alcohol, weapons, etc. are prohibited from being registered on the platform to raise donations. Entrepreneurs who submitted the project idea may not have submitted a prize proposal. In such a case, an indiegogo entrepreneur can award a prize and the entrepreneur has to accept it. Indiegogo makes no guarantees about the copyright and the reproduction of the project. All responsibility in this regard belongs to project idea owners.

Author: Ahmet Bhattacharji Avsar

Posts created 28

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