Increasingly, companies are using crowdfunding to finance an investment (such as a business takeover). The pros and cons are summarised below.
Crowdfunding is an alternative form of financing in which often private investors invest directly or via an online platform in a company. However, within the SME sector, investments mainly take place with the help of own funds or bank financing. Nevertheless, crowdfunding is also gaining in popularity within the SME sector.
The rise of social media has largely contributed to this increase, because it makes it easier to find investors. Competition for crowdfunding platforms themselves is also growing strongly. There are already more than 90 crowdfunding platforms. The most well-known crowdfunding platforms for entrepreneurs are: Money for each other, Collin Crowd fund, Kickstarter and Symbid. Many entrepreneurs are no longer convinced by the large amount of funding available and wonder what exactly is the added value of crowdfunding compared to other forms of funding?
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