Crowdfunding and network marketing or multi-level marketing are probably the most discussed terms in the business forums today. Now, how about the amalgamation of both?
Read on to know more about this interesting concept.
Crowdfunding - What is it?
Crowdfunding is a source of alternate financing where a project or venture is funded by raising small amounts of money from a group of people, usually through the internet.
Though the term crowdfunding is typically used in the context of generating funds via internet, crowdfunding can also be done benefit events, mail order subscriptions and other methods.
Entrepreneurial ventures are most benefited from this new age technique of fundraising. In addition to this, non profit projects like creative and artistic projects, medical expenses, travel, social entrepreneurship projects etc are also using this method to raise necessary funds.
How is Crowdfunding done?
There are different ways by which crowdfunding is done. The motive behind investing in each kind is different.
Investment crowdfunding and loan based crowdfunding are governed by banks and other financial institutions while the other two options are not. There are lot of crowdfunding websites online which displays the projects that are seeking funds. If there is something that strikes you, you need to probe further into the details of the project and collect the following informations.
Based on these factors, you can decide if you want to invest in a project. If the project raises the total amount of funds required, then it would take off and you can sit back and relax while your invested money multiplies.
In case the necessary funds are not raised, the project is cancelled and money is given back to the investors.
Why fund projects via crowdfunding?
Crowdfunding has already been deemed as the next big investment trend by the financial experts. You would be surprised to know that $34 billion was raised in 2015 by crowdfunding.
There are quite a few reasons that justify the popularity of crowdfunding today.
You don’t need to invest all your savings or take a bank loan to invest in your project and take a great risk. The risk factor is minimum for both the entrepreneurs as well as the investors.
In the worst case, if a project does not turn out to be successful in raising the funds, the accumulated funds are given back to the investors.
Real Time feedback
During the course of raising the project, you can create polls and take feedbacks from your investors. This can help you make necessary adjustments as you go on during the course of the project to make your product suit the needs and expectations of the market.
A great marketing tool
You are spreading the message of your project and brand all round the world when you share your campaigns through various websites. Moreover, your investors will definitely spread word in their circles about your project and campaign.
What is MLM and how does it work?
MLM or multi level marketing involves the marketing and sales of goods and services of a company by independent distributors who will earn a commission for the volume of sales done. These independent distributors can go a step further and recruit people under them and earn a fraction of the commission they earn from their sales as referral commission.
Know more about MLM Software and MLM plans from here.
Crowdfunding with MLM
When Crowdfunding meets MLM , the results are simply extraordinary. Even though MLM sounds quite easy, it takes a lot of hard work, perseverance and great skill set to eventually succeed in it.
Also, let us not forget the fact that not everyone is blessed with the right skills to be a great salesman.
This amazing combination of crowdfunding with MLM can help those people who would like to invest in MLM but does not possess the right skill set for becoming one.
This scheme brings in the network building aspect of MLM into crowdfunding. They do not have to sell or promote any products.
In addition to investing an amount of money into crowdfunding venture , the members would have to bring in new members who would also invest an amount of money into the project.
They would also earn rewards for each new investor that they would bring in. For More; Crowdfunding Moving to MLM.
We provide Crowdfunding MLM software in order to help manage the network of investors in an easy manner.
Make the most out of this novel business scheme. Contact us now!