This is a combination of efforts where some people have formed a network to pool money through the internet with the aim of assisting efforts of other people and organizations. The crowdfunding platform is meant to provide support to various activities such as citizen journalism, artists, companies that are starting up, picture promotions, software development, scientific research, political campaigns and disaster relief. It is also involved in funding companies through the sale of equity to several investors. This has obtained much attention by US policymakers where they have been mentioned in the JOBS Act which paves way for the small investors who have few restrictions.
The crowdfunding platform has its roots from crowdsourcing. This is where individuals are able to reach their goal through leveraging and obtaining from people small contributions. Crowdfunding applies the same notion as it involves obtaining funds through collecting small contributions from several people or parties with the aim of financing a certain project. The input by the individuals influences the outcome. Every person participating in the process plays a role of an agent with the aim of promoting a project. The participants play the role of donating aiming at helping the social project. Sometimes they also become shareholders as their contributions are involved in the growth and development of the project.
Crowdfunding is an application of collecting money by having small contributions by several parties so as to finance a venture or a specific project. The crowdfunding model has participants ranging from the organizations and people who are suggesting the project that requires funds. It also involves the people who are very much supporting the project. It later on gets support from the organization which is in this case the platform which has the role of connecting the crowd and the initiator of the project.
There very many crowdfunding platforms. The creators of projects therefore have a duty to perform an investigation so as to understand the best platform to use having in mind the project they would want to be funded. An example is the Crowdcube which is an internet platform that makes the small companies be in apposition to use the internet in issuing of shares. They in return obtain small investments. The Crowdfunding platforms therefore make the required conditions and organizational systems involved in resource integration to take place.
Relational mediators such as the Kickstarter and SellaBand are responsible for acting like the intermediary between the demand and supply. They replace the venture capitalists and record companies which are traditional intermediaries. The platforms connect the designers, new artists and the project initiators with supporters who are committed and believe in those that are for the project very much with the aim of offering the financial support required.
The growth engines aim at strong inclusion by the investors. They are involved in eliminating all the activities meant for service provider who was initially the one to work on networking people together. The crowdfunding platforms obtain stakes through the high network community which match and are worth private investors with project initiators.
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