Crowdfunding has emerged as one of the most popular tools for startups in India to raise funds. It is become a great way to go beyond what traditional investors are willing or able to do and is often much quicker than other options like debt financing.
However, there are many pitfalls that can make crowdfunding difficult for you – this blog post will help guide your way!
The Indian startup ecosystem is booming and new startups are cropping up every day.
If you are a budding entrepreneur looking to get funding for your business idea, crowdfunding could be the answer.
Crowdfunding has been gaining popularity in India over the last few years and it’s easy to see why. With an already large community of investors on popular sites like Wishberry, there is no shortage of funds waiting for you if you know how to pitch your product or service effectively!
Do you want to start a successful crowdfunding campaign in India but don’t know where to start?
This comprehensive guide will walk you through everything from preparing yourself mentally and financially, choosing the right platform for your goals, coming up with innovative rewards that customers can’t resist, and much more.
We will also take a look at the top five crowdfunding websites in India where you can launch your campaign so that you know which platform is right for you!
So without further ado, let’s get started with The Ultimate Crowdfunding Guide For Startups In India .
What is crowdfunding?
Crowdfunding is essentially a platform where people can fund your business idea by contributing either money or resources like time and effort.
The main benefit of crowdfunding for startups in India is that you can gain funding for your project from anyone, anywhere in the world as long as they have access to the internet!
Types of Crowdfunding Sites in India
There are two major types of crowdfunding platforms available today – donation-based sites and reward-based sites.
Donation-based websites focus on non-profit goals while reward-based ones contribute towards profit-oriented businesses.
If you are looking for investors who want to see returns on their investments, then there is no better place than a reward-based site.
There are some key differences between these two types so let’s take a closer look at what they are before we get into the best crowdfunding sites for startups in India.
a). Donation-Based Crowdfunding Sites in India
Donation-based websites are often used by artists, musicians, and other nonprofit organizations to raise funds for their projects.
These platforms usually have less stringent guidelines than reward-based ones so it’s easy to get started with them even if you don’t have an elaborate business plan or a prototype of your product yet!
The key advantage of using donation-based crowdfunding for startups in India is that there are no fixed deadlines imposed on fundraisers which means they can run campaigns for as long as they want until all pledged money has been received.
If you are looking to launch a campaign without worrying about meeting specific targets then these types of platforms could be exactly what you need! Some popular examples include Kickstarter, Crowdrise, and GoFundMe
b). Reward-Based Crowdfunding Sites in India
On the other hand, if you are looking for investors who are interested in your product or service then reward-based sites are where it is at.
These websites usually have stricter guidelines so they can be a bit difficult to get accepted on.
However, once you do manage to crack the code of these platforms, things become much easier because you’ll receive access to their large networks of potential backers.
One popular example is Wishberry which has already helped raise over $74 million for Indian startups since 2013!
Some key features that make these types of crowdfunding websites stand out from donation-based ones include deadlines imposed on fundraisers (usually 30 days) as well as specific milestones set for each campaign.
What are the top five Indian crowdfunding websites?
a). Kickstarter
This popular US-based platform has already helped raise over $34 million for various businesses in India since its launch.
- Use attractive perks to incentivise contributions from backers
- Promote your fundraiser across various channels like Facebook, Twitter etc
- Keep track of contributors with an easy-to-manage dashboard If you need additional guidance when creating or promoting your crowdfunding campaign.
b). Indiegogo
This global crowdfunding platform was launched back in 2008 and is known to have raised around $15 million so far through campaigns on their website which are listed under the “India” tab.
c). Wishberry
It focuses on reward-based crowdfunding so you will need to have an attractive business proposal with innovative perks before you apply.
They also offer custom packages if your goal isn’t listed on their site yet which allows them to provide more value even after your campaign gets funded through this service.
Once accepted onto the platform, there are some things you should keep in mind when preparing yourself and launching a successful fundraiser (MORE on this later).
d). Fundchaser
This popular Indian crowdfunding site currently has over 12,000 members who’ve helped raise around $15 million so far.
Here are some things to consider before launching your fundraiser on the platform:
- Keep your perks attractive and deliverable
- Use social media groups to spread awareness about your fundraiser
- Give your supporters something they can brag about on social media
- Include a video of yourself explaining why you’re doing what you
e). Catapooolt
It is one of India’s first equity-based platforms for startups which allows investors to not only donate money but also invest in various types of businesses through their website.
This means that you need an experienced team and a solid business plan if you want people to actually invest large sums of money into your project!
You can find more information about how they work here.
f). Fueladream
This newer crowdfunding platform is quickly gaining popularity since it has an interesting approach where they use a “FOMO” or “Fear of Missing Out” tactic by showcasing the number of days left before even displaying the total funds raised.
I’ve heard that around 85% of users who visit their website end up making contributions towards various fundraisers on the site. Here are some things you should consider when preparing for a campaign:
- Keep your campaign page simple yet effective without all information being displayed upfront so visitors can learn more first through articles, videos etc.
- If you want to backers listed on your project landing page, make sure you have attractive perks which are unique and deliverable at the same time.
What is Wishberry?
So now that we know the basics of what crowdfunding for startups in India means, let’s take a closer look at one specific website – Wishberry.
This popular Indian fundraising platform has already helped raise over $74 million for various businesses in India since its launch in 2013!
It focuses on reward-based crowdfunding so you will need to have an attractive business proposal with innovative perks before you apply.
They also offer custom packages if your goal isn’t listed on their site yet which allows them to provide more value even after your campaign gets funded through this service.
How do I start a successful campaign on Wishberry?
Once accepted onto the platform, here are some things you should keep in mind when preparing yourself and launching a successful fundraiser:
a). Have Your Community Prepared
The first step towards building up support for your campaign is to have a large community of people who are interested in what you’re doing.
Make sure that everyone is aware of the upcoming fundraiser and get them involved before it begins!
You can do this by creating a dedicated landing page for your product or service, sending out emails about it, using social media groups related to your business niche, etc.
b). Create a Compelling Campaign Page
Once launched, make sure to create an attractive campaign page with all relevant information regarding your project where potential backers can learn more from you.
Also, keep in mind that Wishberry has strict guidelines which prohibit fundraisers from asking for donations instead of pledging money towards their projects so be very careful while writing up these sections on your website.
For instance, if someone wants to support your activism campaign for a cause but doesn’t have enough money to do so, they can still pledge $50 and get the perk of being listed on your website which helps attract other potential sponsors.
c). Incentivise Backers with Perks
Once you have got everyone excited about what you are doing it is time to offer them something in return!
Make sure that all perks offered by fundraisers are highly desirable (and deliverable) because this is one of the best ways to encourage people to make contributions towards your fundraiser.
For instance, if someone wants their logo displayed on the landing page of your crowdfunding project, make sure there is no delay in delivering such an incentive after making a pledge.
Also, keep in mind that these types of websites usually charge around a fixed platform fee ranging from around $100 to a few hundred dollars depending on the type of campaign you’re running.
d). Pledgers vs Investors
After your project is accepted onto Wishberry, keep in mind that it is not an investment.
While some people might think they are participating in early-stage fundraising for startups by making contributions towards fundraisers, chances are high that their funds will be used only as per stated perks and no equity or voting rights come with them.
This means that if someone is expecting returns on their investments through these types of crowdfunding sites for startups in India, then this isn’t the right approach for them since there are several other avenues available where investors can have more control over what happens to their money.
Is crowdfunding legal in India?
Yes, it is just like any other online fundraising model.
Is crowdfunding secure in India?
Yes of course! Since there are dedicated donors who usually invest more than one lakh rupees on projects that they believe will do well in the long run. This makes them extremely loyal to their chosen fundraisers.