List of Crowdfunding Sites
Crowdfunding refers to the process of raising money from a large group of people to fund particular ventures or causes. As a result, money is typically raised online through crowdfunding investment platforms, with minimum investment amounts varying by website.
There is a long list of crowdfunding sites in Australia, each with a different purpose.
- (1) VentureCrowd is an equity crowdfunding platform that gives investors access to investment opportunities in startups and the property sector. Therefore, people choosing to invest receive equity in the company they are investing in. So how does it work? Firstly, Companies looking to raise money list details of the company and equity offer on the VentureCrowd website. Then, interested investors register their interest to invest 100% online. Investment opportunities are open to wholesale investors (minimum $250k investment) and more recently to retail investors (certain opportunities only).
- (2) GoFundMe is a crowdfunding site used to raise money for a particular cause or charity drive. Causes vary significantly, from raising money for victims of a flood or for someone going through a traumatic life event. As a result, GoFundMe has received a lot of media attention for demonstrating people’s desire to assist others.
- (3) Kickstarter is a crowdfunding site that focuses on raising money for creative projects. Investment opportunities include design and technology, film, arts, music, food and craft, publishing and comics and illustration. Pozible is a similar well-known crowdfunding site, if the raise goal is not reached the company receives no money.
- (4) Equitise is another unique model, and perhaps most similar to Venture Crowd, however it operates using a syndicate investment model. Syndicates enable private investment groups to fund investments or share their investments with other investors. As a result, Equitise has garnered interest from some of Australia’s most progressive venture capital funds.
So what are the similarities and differences between peer to peer lending and crowdfunding?
The similarities include:
- (1) Both funding models raise money from a large number of investors who pool their money together to invest.
- (2) Increasingly these investment opportunities are being offered online via high-tech investment platforms.
- (1) The way in which investors receive their returns and the possible level of returns that can be achieved. OurMoneyMarket’s peer to peer investors invest in personal loans which is a fixed income asset class. This means each month investors receive principal and interest on the loans they invest in. As a result, the return an investor receives on the personal loans depends on their level of risk appetite, with returns generally ranging from 7.04% to 29.53%.
So ultimately, peer to peer lending and crowdfunding are a bit similar. They both involve sourcing funds directly from everyday people to fund causes. Whether that is starting up a new business, or going on holiday. Main difference is that peer to peer lending, or marketplace lending, are typically loan/debt platforms.
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