With crowdfunding becoming more popular as an alternative finance solution, here are our answers to the top five questions on crowdfunding – drop us an email with yours!
Q: What is crowdfunding?
A: Crowdfunding is a form of alternative finance.
It gives entrepreneurs, businesses, start-ups, charities – anyone from any industry – the chance to raise money to fund their idea, without having to worry about bank loans or angel investors.
The idea behind crowdfunding is to raise funds via a project’s ‘crowd’ or target audience. Rather than getting one large sum from a single source, through crowdfunding one receives many small contributions from various sources (the ‘crowd’), to raise enough capital to fund your idea, project or venture.
Q: What’s the difference between reward-based and donation-based crowdfunding?
A: Sometimes confused as the same, ‘reward-based’ and ‘donation-based’ are in fact two different crowdfunding models.
Reward-based campaigns must offer backers non-financial rewards, such as products, services or experiences. They typically use the ‘All or Nothing’ (AON) model – so if the campaign doesn’t reach its funding goal, all backers receive a refund of their contribution.
Donation-based campaigns are only for projects led by a registered charity or voluntary organisation. Backers donate funds without receiving a reward. Often these campaigns use the ‘Keep it All’ (KIA) model, meaning they can keep whatever they raise, even if they don’t hit their funding goal.
Q: Which crowdfunding platform should I choose?
Although there are several international platforms available, as Malta’s only reward and donation-based crowdfunding platform, Zaar is a local platform for local projects with international aspirations (so your fans in Australia can contribute as easily as your neighbour!).
We’ll help you reach out to the local community, as well as to a larger audience across Europe. Zaar is a Gold Member of EUROCROWD, the European Crowdfunding Network (ECN).
And how about a bot-free experience? Just drop Zaar an email and you’ll find a human in-the-know to help you with your crowdfunding experience.
Q: How do I launch a campaign?
Once you’ve registered on the Zaar site, you’ll find a profile dashboard that will walk you through launching your campaign.
But well before you hit that launch button, you’ll need to plan your campaign – your marketing, timeline, rewards, updates, budget, funding target, compelling campaign content such as text, video, images and so on. Check in with Zaar if you need help!
Q: What’s up to me and what’s up to the platform?
When you register with Zaar, your campaign will be showcased on our online platform. We will also feature your project in our popular online newsletter and our social media channels. Plus, you gain access to Zaar’s network to help you develop your idea and even your career as an entrepreneur.
However, you are the most important part of your crowdfunding journey. Either by yourself or with a dedicated team, you will need to cover every aspect of your campaign’s planning, content and promotion. You know your target audience and who your people are – successful crowdfunding needs a dedicated crowd, and that’s down to you!
Get in touch with Zaar today to ask about launching your own crowdfunding campaign.