Best Crowdfunding sites

Bronson Chang, a native of Hawaii and 2010 graduate of USC, wanted to return home and grow his uncle's business. The business, called Uncle Clay's House of Pure Aloha is a tattoo in the local community and is known for incredible homemade, natural Hawaiin treats. Mr. Chang felt he could take his Uncle Clay's shop to another location level by opening more stores and introduce new products. There was just one small problem --- regardless of the store's popularity, neither he nor his uncle had the capital to grow the business. In place of turning to traditional sources of funding like banks or venture capital, Mr. Chang used a relatively new way of raising money called crowdfunding sites to enhance the $54K he had a need to expand the Uncle Clay's House of Pure Aloha.

Crowdfunding uses the wisdom of crowds to help entrepreneurs, artists, writers, and non-profits raise money by allowing visitors to donate funds to support a task or business. It allows those people who are seeking money, and those people who have money to invest, the ability to take their cause to the community and share the risks among many. Additionally, it solves the issue of too few venture capitalist and way too many entrepreneurs.

The process is relatively simple for both the entrepreneur and the investor.

The entrepreneur has a good idea. They present it online. Investors read about this and fund it. In most cases, as the selling of equity carries with it potentially strict regulations, the firms actually don't stop trying any equity or incur additional debt. Instead, the entrepreneurs give out rewards for the cash invested (investments are actually not necessarily investments where there is implied return --- but a donation).

The success of companies like Diaspora, a fresh open social networking site that plans to compete keenly against Facebook, and the Million Pixel Project, where anyone could buy pixels on an internet site for $1 per pixel, are driving more and more entrepreneurs and creative types to depend on crowdfunding to improve money.

This is a overview of six sites an entrepreneur may consider if crowdfunding appears like an option:

1. Startup Addict: a way for visitors to pool small amounts of money to back advisable or project. Free registration for exchange of a 5% commission on successfully funded projects. It is a threshold based funding project where in actuality the investor receives the cash only when the threshold funding level is met. Or even, the cash is returned to the pledgers. There's no exchange for profits, but instead, a reward from the founder (the founder can decide what she gives as a reward based on their own critieria). The founder typically has up to 90 days to attain funding for the project. Starupaddict provides for all sorts of startups to improve money, including non profits. Unlike a great many other crowdfunding sites, it's not only geared to the creative types.

2. Rockethub.com: Rockethub provides a creative an innovative way to raise money. Like eBay and Amazon, Rockethub is a platform for emerging artists and entrepreneurs to have funding for his or her projects. Like a lot of crowdfunding sites, Rockethub doesn't allow entrepreneurs (whom they call Creatives), to stop any equity or shares in the company. Instead Creatives are responsible to offer out rewards to those who fund the project (funders of projects are called Fuelers). Another innovative approach at Rockethub is the ability to earn badges. Badges can be earned by both Fuelers and Creatives for performing certain tasks on the site. As you unlock more badges by performing more tasks, like commenting on a task, or being the first to register for a task, then you definitely are eligible for extra rewards.

3. Kickstarter.com: Again, like Rockethub, it provides crowdfunding for creative types on specific projects. A project is defined as something that's finite, with a clear beginning and end. Like a great many other sites, unless a task is fully funded, the entrepreneur doesn't receive any funds. Also, Kickstarter only accepts payment through Amazon's Flexible Payments Services. Paypal, and charge cards aren't allowed because Amazon's FPS enables and protects all or nothing funding methods.