Investing in companies has drastically changed over the years with the development of crowdfunding platforms. Individual people are now provided with the opportunity to invest a certain amount of money into a company or an idea in order for it to be successful or available on the market. This can be mutually beneficial for both the individual backer and the company. With the increasing popularity of crowdfunding platforms such as Kickstarter and Indiegogo, more and more people are searching for ways to gather backers online.
Yearly Crowdfunding Estimates
As previously mentioned, crowdfunding platforms are becoming more and more popular throughout the internet community. It is estimated that over $4.35 billion will be invested into businesses through websites such as Kickstarter and Indiegogo by the end of 2015. This is a significant increase from previous years as in 2011, only $138 million was pledged and in 2013 approximately $1.17 billion was invested in companies and ideas.
Where Crowdfunding is the Most Popular
Generally speaking, it is relatively well-known that crowdfunding is undoubtedly the most popular in major cities across the United States. With that being said, the cities that raised the most for crowdfunding websites are:
1. New York City: $157 Million
2. Los Angeles: $146 Million
3. San Francisco: $92 Million
4. Seattle and Chicago: $36 Million
Categorical Success Rates
As per the business industry, there are particular industrial categories that are far more successful than others. As an example, lifestyle companies may not make as much money as music or dance companies. This same theory also applies to crowdfunding pledges. The success rates for acquiring the most money from crowdfunding platforms from most to least successful include:
• Small Business
Kickstarter vs. Indiegogo
As previously mentioned, the two major crowdfunding platforms are Kickstarter and Indiegogo. With that being said, it can be easier to use one platform versus the other simply because more people use it and businesses have experienced a higher success rate with their help. With that being said, the choice of crowdfunding is up to the individuals using the website.
• $1.2 Billion Pledged
• 15.8 Million Pledges
• 23 Million Hits/Visits per Month
• 154,000 Completed Campaigns
• 43.4% Success Rate
• $378 Million Pledged
• Million Pledges
• 13.4 Million Hits/Visits per Month
• 246,000 Completed Campaigns
• 9.8% Success Rate