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Investments: What are Crowdfunding?

2020-01-01 09:23:26

Did you know that among the methods related to investments are the Crowdfunding, well here we are going to explain that they are them.

What is crowdfunding?

Crowdfunding is a method of financing a specific project, whose objective is to make contact between the promoters of the projects and the investors of the funds from which it is expected to have a return, here there is no financial intermediary, because it is a collective financing which is done through an online platform on investments 

What are the types of crowdfunding?

Ø Crowdfunding: this aims to receive a reward according to the form of the service or product.

Ø Crowdlending: this is simply the contribution that is executed in exchange for the interest on the money that has been lent, this interest tends to present variation according to the amount that has been lent and the term of repayment of the same.

Ø Crowdonation: these are simply the contributions that are usually made in a disinterested manner, since no reward is expected from them at all.

Ø Crowdinvesting: this is simply the consideration from which certain benefits are expected in the medium and short term, through the shares or simply from the participants in the company.

How does Crowdfunding work?

Ø The entrepreneur of such a project is able to send the project to the platform, where it shows a detailed description of the project, as well as the type of Crowdfunding and the amount required to carry it out.

Ø It is a platform that is responsible for assessing the project and publish it, this is where it will give indications about the time available for people to invest in it.

Ø When the project has been published, the entrepreneurs are able to promote it and thus obtain funding.

Ø At the end of the determined period the project is closed, and in this way it can be checked if the financing has been achieved.

In this way we finish our article related to investments and everything we need to know about Crowdfunding.

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