Indiegogo

Definition

Indiegogo is a crowdfunding platform that allows individuals and organizations to raise money for creative projects, businesses, and charitable causes. It connects entrepreneurs and creators with potential backers, facilitating the funding process through rewards-based contributions or equity financing. This platform empowers innovators to secure financial support while engaging a community of supporters who can directly influence the success of their projects.

5 Must Know Facts For Your Next Test

1. Indiegogo was founded in 2008 and has become one of the most popular crowdfunding platforms globally, allowing projects across various categories like tech, film, and social causes.
2. Unlike some other platforms, Indiegogo offers both fixed and flexible funding options, meaning creators can keep the funds raised even if they do not reach their goal.
3. The platform has facilitated the funding of numerous successful projects, including innovative gadgets and films that may have struggled to find traditional funding.
4. Indiegogo also provides tools for marketing and promoting campaigns, helping creators reach a wider audience and effectively communicate their project ideas.
5. The platform has fostered a community of backers who are often passionate about supporting new ideas and innovations, leading to potential long-term relationships between creators and their supporters.

Review Questions

• How does Indiegogo facilitate the connection between entrepreneurs and potential backers?
  • Indiegogo serves as a bridge between entrepreneurs looking for funding and individuals interested in supporting innovative projects. By providing a platform for project creators to showcase their ideas through detailed descriptions, visuals, and funding goals, it attracts potential backers who can contribute financially. The platform's structure encourages engagement, allowing backers to choose from various projects that resonate with their interests and values.
• Discuss the advantages of using Indiegogo over traditional funding methods for creative projects.
  • Using Indiegogo offers several advantages compared to traditional funding methods. It allows creators to reach a global audience without the constraints typically associated with seeking venture capital or loans. Additionally, Indiegogo provides flexibility in funding options—creators can keep whatever funds they raise even if they don't meet their initial goal. This model empowers entrepreneurs by giving them more control over their project's financial future while engaging directly with supporters who believe in their vision.
• Evaluate the impact of rewards-based crowdfunding on entrepreneurial ventures and the innovation landscape.
  • Rewards-based crowdfunding through platforms like Indiegogo has significantly transformed the entrepreneurial landscape by democratizing access to capital for innovators. This shift allows creators to validate their ideas before fully developing them, reducing the risk typically associated with new ventures. Furthermore, it encourages a culture of innovation where diverse ideas can gain traction without relying solely on traditional investors. As a result, this model fosters creativity and enables entrepreneurs to bring unique products and services to market that might otherwise go unnoticed.

Related terms

Crowdfunding: The practice of raising small amounts of money from a large number of people, typically via the internet, to fund a project or venture.

Rewards-Based Funding: A crowdfunding model where backers receive non-financial rewards or perks in exchange for their contributions, such as early access to products or exclusive experiences.

Equity Financing: A method of raising capital by selling shares in a business, where investors receive ownership interests in exchange for their investment.