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Small business begins with an idea. To turn that idea into reality takes money. Sometimes, lots of money.
Not all small businesses can attract funding. A therapist's office, for example, will not get much of a hearing at the local bank's loan window.
Likewise, to start up an art gallery, you'll need funds of your own. You might pass your idea in front of friends and family to get the funding you need.
On the other hand, some ideas attract more attention. Perfect strangers might be willing to fund a new computer game or a local wellness center.
Small business ideas that show big time promise can always attract funding. One of the hottest funding mechanisms today is crowdfunding.
Crowdfunding is exactly that--dollars from crowds of people unknown to you. You go on the net, tell people what you want to do, and the dollars roll in from the crowds.
Or they don't. The successes that have used crowdfunding get lots of publicity. While the high fliers have raised millions, most raise a few thousand at most. And some get nothing.
Third party businesses have sprung up to handle the process. They work like a dating service--sort of. Your business needs funds. There are many people out there who have money. The third party provides the platform where everyone meets and agrees to whatever rules apply.
You must do your research. Google 'crowdfunding' and you'll get lots of possibilities, among them, the platforms you might use.
The biggest player in this field of dreams is Kickstarter. Others include Fundable, Indiegogo, Microventures, EquityNet, CircleUp and Selfstarter. There are many, many more--mostly small or targeting certain types of projects.
Go to these sites and read the rules. Some have minimums that you can request, and some impose a time limit on the raising process. Others require an equity position in your company, and still others concentrate on businesses in specific industries. Some won't take non-profits, others welcome any type operation--including just betting on the individual, no business plan required.
Know where you're headed before you jump into this pond. Some people will send you small amounts of money for no reason at all, but most will want something in return. Are you offering an investment to the people who ante up? Will you send them one of your products? Or are you simply passing a collection plate?
Crowdfunding can be a godsend for small business. But if you don't raise what you need in the allotted time, do you refund the dollars? Guard your reputation.