Entrepreneurs and private companies are now looking for non-conventional ways to raise finance to begin something new or expand their existing base. Non-traditional alternatives such as asset based financing and crowdfunding have become popular and this is just tip of the iceberg!

Crowdfunding especially, has become an easy alternative for Entrepreneurs and Independent ventures. It can be utilized to raise capital from a number of individuals, some of whom might be friends or family. Crowdfunding can be utilized to boost projects or inventions, launch a business, pre-sell new products, launch a new clothes line or even finance production costs for a feature film. 

Testing markets for a new product or raising working capital for raw materials or inventory are some other possible outcomes for crowdfunding. The situation is changing every day with the spirit of entrepreneurs, who like to stay undeterred when faced with a financial barrier. 

Billions of dollars are raised annually through crowdfunding and these platforms typically charge 5 percent or more on the funds raised.

But contrary to the popular belief, crowdfunding is an old concept. One of the most famous examples is the Statute of Liberty in the United States of America.

The American Committee for the Statue of Liberty was short on cash for the Statue’s pedestal in 1884 and a newspaper distributer Joseph Pulitzer saved the day with his innovative idea. He composed an article and distributed it in his daily paper which compelled about 125,000 New York citizens into contributing $1 or less to raise the cash required. 

This produced $100,000 to pay for the Statute of Liberty pedestal. As a token of appreciation, every contributor’s name was published in the daily paper. The facts of the case reflect modern crowdfunding elements. 

Modern crowdfunding has been around since the 2000s, here are some types: 

Debt – Interest is charged in return of the funds raised, with a specified time frame for repayment.

Equity – Ownership or a stake in the company/product is offered in return of the money contributed.

Unfortunately, Debt and Equity based crowdfunding is not allowed in India, at present.

Donations – Money is raised with no promise of something in return. Everyone contribute because they believe in the cause. 

Rewards – A reward is promised to every contributor, in exchange of the money raised. Rewards can be a Product, social media recognition or invite to an event.

Through crowdfunding, thousands of entrepreneurs and inventors have raised funding for new technologies, research and products. Crowdfunding makes it easier to enter the market which previously wasn’t so simple. Though, Crowdfunding can’t serve everyone’s purpose and different platforms don’t have everything in common, but it presents as a very easy and non-conventional method of raising finance.

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Xiaomi is not just a smartphone company or an electronic giant but is also a hub of innovation. With its innovative products released every other month, it has given the signal to the world that it will enter every sector that has any space for innovation. Recently Xiaomi-backed Yunmai launched a new wearable called the Yunmai smart training watch for INR 7200. If we take the clock back a few days to February 15, 2019, Xiaomi Mi Men’s Sports Shoes 2 were launched in India that featured Fishbone Structure and shock absorbance for INR 2500 and a Mi Luggage suitcase for INR 2,999 in September 2018. Now, Xiaomi is back with another innovative product. This time it has launched a crowdfunding campaign for smart fingerprint lock (AreoX Smart Fingerprint U-lock) that obviously operates on the fingerprint sensor but comes with a physical unlock key as well if the battery runs out.

Now, the important thing to notice here is that most of these products were launched through the crowdfunding campaigns, has innovation speak its best, are in budget and also curated keeping Indian customer requirements in mind. The crowdfunding project on Xiaomi’s crowdfunding platform YouPin has already crossed 1,011,000 Chinese Yuan (>Rs 1 Crore), which is almost 2.5 times of its set target. You can crowdfund and get the U-Lock with the shorter beam priced at 199 RMB(INR 2050) and the other one with the longer beam priced at 219 RMB (INR 2256) which is likely to start shipping from May 23, 2019.

Key features Xiaomi’s AreoX Smart Fingerprint U-lock Sports

As per the crowdfunding page, the U-lock can be used to lock bikes and even cars. The U-lock sports a stainless steel lock beam for which the company claims, can’t be easily cut with the help of a hacksaw and comes with “an anti-theft lock body”. The body of the lock is IP65 certified that makes it resistant to water and dust. The biometric identification can unlock within about 0.55 seconds and as to serve the purpose of any lock, to keep your belongings secure, the company claims that the lock detects dummy fingerprints within seconds. Its battery can last up to 12 months and you get a USB Type-C port in case, it gets discharged.

A smart lock that costs INR 2000 to save your precious belongings isn’t a bad deal? What are your views on this thing?

Sources:

Xiaomi announces the AreoX Smart Fingerprint U-lock priced at 199 yuan (~$29) – Gizmochina

Xiaomi launches AreoX Smart Fingerprint U-lock as part of crowdfunding program – BGR

AreoX smart fingerprint U-lock – YouPin

Main Image: ©

The post Xiaomi Is On The Roll, Launches AreoX Smart Fingerprint U-lock For INR 2000 appeared first on Catapooolt.

Now, if you are thinking if your idea, initiative or whatever you have in mind is not something that the crowd will be interested in supporting, let me clear your doubts. You just need to look out for the multiple solutions possible. Figure out the ways how other people approached the same issues you are facing now. You will become an alchemist, my friend. You will create magic.

Be it politics, healthcare, real estate, women entrepreneur oriented crowdfunding, crowdfunding startups, fintech, technology, legal, rescue and causes, innovation, some crazy Innovation, gadgets, brewery, education and whatnot, crowdfunding is the key. Stop hesitating, start crowdfunding.

Here is an infographic tracking the scope of crowdfunding in different domains.

Equity and debt investment crowdfunding is another gem adding to the beauty of crowdfunding. You can learn more about it in the preceding hyperlink.  

The beauty of crowdfunding is in its omnipresence, be it crowdfunding for education, legal, startup, healthcare, gaming or political.

To read more on the above infographic, read the following write-ups.

Politics

• Atishi Marlena, AAP’s East Delhi Parliamentary Seat In-Charge’s Crowdfunding Campaign Reaches Rs 19 Lacs

• Shah Faesel, The Kashmiri IAS Officer Launches Crowdfunding Campaign Seeking Donation For ‘Clean Politics’

• Dmytro Gnap, A Former Ukrainian Journalist Crowdfunding His Bid To Be Ukraine’s Next President

Legal

• Julia Salasky, The Women Who Made Justice Accessible With The Help of Crowdfunding

Startups

• When Blockchain, AI And Big Data Became Friends With Crowdfunding In India

• Black Hops, One Of Australia’s Fastest Growing Breweries, Invites Backers To Its Equity Crowdfunding Campaign

Women Entrepreneur Oriented Crowdfunding

• Cheer Up, Ladies! Studies Show How Women Are Outshining Men When It Comes To Crowdfunding

Fintech

• Crowdcube, The UK Based Crowdfunding Platform, Announces £500,000 Fund To Boost Inclusive U.K Fintech

• EY Report: Crowdfunding Outraces Bank Financing As Preferred Option In the UK

Healthcare

• iDyslexic, An App Facilitating Brighter Future For Students With Dyslexia Goes Live Ahead Of Crowdfunding

• Crowdfunding Campaign Of A Medicinal Cannabis Company In New Zealand Reaches $820K

Innovation

• FOCI, A Wearable That Will Help Boosts Your Focus Like Sherlock’s Is Finally Here

• CycleWing, A Deployable Wind Propulsion For Bicycles Is Now Crowdfunding On Kickstarter

Rescue And Causes

• Crowdfunding Campaign To Treat The Shot & Robbed Telangana Engineering Student Sai Krishna In Michigan Goes Live

• Crowdfunding Initiative Supported By Messi, Mbappe & Other To Rescue Missing Emiliano Sala Reaches £370k

Gadgets

• All-In-One Modular Smartphone Doogee S90 Is All Set For Its Crowdfunding Campaign Launch

• Meizu Zero, World’s First Holeless Phone Goes Live On Indiegogo Crowdfunding For $1299

TV Shows And Art Projects

• The Chosen, A TV Show About Jesus, Issues Equity, Making It The Largest-Ever Crowdfunded Campaign In The Category

• Show4me, A Music Interaction Network & Crowdfunding Firm Closes $12.8 Million Funding Round

I hope you enjoyed reading it. Let me know what do you think of the scenario of crowdfunding in India. Criticise it, or ask questions if you think I can answer them. Let’s have some conversation. Over to you.

Learn how to create your first crowdfunding campaign.

Lemon.Connect – Biggest Fintech Conference in London #JoinTheConf April 23 – 26, 2019. Register now!

The post The Sheer Beauty Of Crowdfunding appeared first on Catapooolt.

Black Hops Inception – 2015

The genesis and development of this thought about opening up a brewery manifested when 3 mates Dan, Eddie and Govs began discussing a concept over a beer at the pub. They decided that they will make craft beer and share everything they learn along the way. Eventually, they made their first beer, the Eggnog Stout.  

They brewed the world’s first official Call of Duty beer in 2015 and successfully raised $17,000 via Pozible to become the first Aussie brewery to launch via crowdfunding.

Accolades

Black Hops was recently awarded 5 Gold Medals at the 2018 Australian International Beer Awards.

They were honoured with two trophies including the Champion Small Australian Brewery, making it one of Australia’s highest rated and fastest growing breweries.

The Brewery will feature investment rewards from $50 and up to $10,000 for retail investors. Investors will be offered priority access to limited release beers too. Black Hops has set a target to raise $400,000 from investors through this equity crowdfunding campaign with Birchal.

This is what Dan Norris, co-founder of Black Hops had to say on “equity crowdfunding”

“We’ve been following the process for legalising equity crowdfunding for a few years. Now that it’s finally here, we are looking forward to being one of the first breweries to run a campaign and the first to use equity crowdfunding to help fund the opening of a brewery.”

“One of the best things about crowdfunding is how great it is at building up a group of advocates and followers. We’ve done this since day one with our Black Hops Ambassadors.”

He further added, “Backers are likely to be fans and advocates of your business and thrilled to be part of the action. And what better advocates for your company than the people who are prepared to buy a stake in it. We believe that equity crowdfunding is a great way for everyday drinkers of our beer to become investors and share in our future growth.”

Overview

Previously, under the crowd-sourced funding (CSF) regime companies were required to convert to unlisted public companies before they could raise funds under the regime. Now, it has been expanded to include proprietary companies as well, thereby such companies can raise up to $5 million every 12 months from retail investors on a licensed CSF platform.

Read more- What are Different Crowdfunding Models that have steamroll Traditional Financing?

Main Image: © Black Hops

The post Black Hops, One Of Australia’s Fastest Growing Breweries, Invites Backers To Its Equity Crowdfunding Campaign appeared first on Catapooolt.

“Crowdfunding is creating a new public demand which connects common people with investment opportunities that used to be accessible only by the very wealthy.”

And there is no doubt or secret to the intricacies of investment that crowdfunding has aid to small businesses or the newbies of the startup world by connecting them to the common public for raising capital. Crowdfunding simply means, getting funds from a large number of people with the usage of the internet and an online social media platform. The inception of this modern day crowdfunding dates back to 1997 when a British rock band funded their reunion tour through online donations from fans. Since then, crowdfunding has taken many forms and has emerged as one of the most effective options for entrepreneurs and other project initiators to validate their ideas.

So let’s understand some of these different dimensions of Crowdfunding and gets penetrate about them:-

1. Reward- based Crowdfunding

This model of crowdfunding is mainly used by startups who want to accelerate the pace of their initiative and by other projects of artists or film producers, software development or civic projects etc. Reward crowdfunding is based on the perks or rewards a potential backer gets in return of the investment made by him/her. Rewards can be in the form of product or service, he/she is backing up or any other rewards mentioned in the campaign in prior.It is a lucrative method to raise funds as donors donate in the expectation of return. The rewards are differentiated on the basis of backers contributing smaller amounts and the ones who cater gratitude.

Following perks can be rewarded to the potential patrons:

• The backers who contribute less than rs.500 can be revert back with the recognition through the way of a ‘Thank You’ note or a gift card or simply by thanking them personally on the campaigner’s social media page. Make them realize that their every effort is worth of a count.
• Contributors can be rewarded by services like giving them discount, or some smaller reward tiers like shout outs or exclusive t-shirts.
• An effective way of rewarding is pre-orders. Backers will back up in the expectation of availing the product they are contributing their money for.

Companies like Catapooolt, Kickstarter and Indiegogo have emerged as the best reward based crowdfunding platforms of India and are helping hundreds of startups gaining funds for various causes.

2. Equity- based Crowdfunding

SEBI (Securities and Exchange Board of India) regulates the rules regarding Equity Crowdfunding and has made it illegal in India. In this model of Crowdfunding, the backers are termed as ‘investors’ because they invest their money into the company for an amount of share in it on the basis of capital invested. Primarily, these investments are made in the companies with the goal of making a return in 5-6 years.

Usually, a large amount of capital is raised through this model and not the smaller ones. This amount is mainly for either launching a company or taking a big leap, not just for backing up a cause. In India, such funds are raised through an angel investor or a VC for a startup. We have been using other forms of crowdfunding that is reward or donation based, so if you want to raise capital you can avail the advantages of crowdfunding through platforms like Catapooolt for ensuring a swift capital coming in your way.

3. Debt- based Crowdfunding

Also known as ‘Peer-to-Peer Crowdfunding’ or ‘Crowdlending’ is a model based on the process in which investor invests in your project in return of the ‘interest’. Money lent by multiple investors in small amounts through the internet is called Debt-based Crowdfunding. It is somewhat similar to loan except that in crowdfunding, loan is borrowed from a number of investors in small amounts rather than from a single bank. Debt Crowdfunding has an edge over bank loan because of the interest rates being lower and funds can be garnered with ease by reaching among the masses at the same time.

It can be an optimum method for businesses that might get failed to raise loans from banks. But as the saying goes, nothing comes exquisitely. The drawbacks faced by debt-financing are the regular interest payments and the security that companies have to pledge against their assets. Thus, it may be suitable for companies who have already established venture and adequate assets or sufficient cash flow credibility.

A Quick Collation

A major asset that Debt Crowdfunding has over an Equity Based Crowdfunding campaign is that the campaigner doesn’t have to lose any share in its company. Thus, investors are serviced only with the profit share and the owner continues to enjoy his ownership. Equity Crowdfunding is illegal in India. Therefore, for newly established ventures, an imperative option can be to go for the reward and donation based models of crowdfunding. Whatever the model you choose, just go dig well before in the advantages and disadvantages it chalk up.

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