Collection of finance from backers to fund an initiative
Crowdfunding is the practice of funding a project or venture by raising money from a large number of people, typically via the internet.[1][2] Crowdfunding is a form of crowdsourcing and alternative finance. In 2015, over US$34 billion was raised worldwide by crowdfunding.[3]
Although similar concepts can also be executed through mail-order subscriptions, benefit events, and other methods, the term crowdfunding refers to internet-mediated registries.[4] This modern crowdfunding model is generally based on three types of actors – the project initiator who proposes the idea or project to be funded, individuals or groups who support the idea, and a moderating organization (the "platform") that brings the parties together to launch the idea.[5]
Crowdfunding has been used to fund a wide range of for-profit entrepreneurial ventures such as artistic and creative projects,[6] medical expenses, travel, and community-oriented social entrepreneurship projects.[7] Although crowdfunding has been suggested to be highly linked to sustainability, empirical validation has shown that sustainability plays only a fractional role in crowdfunding.[8] Its use has also been criticized for funding quackery, especially costly and fraudulent cancer treatments.[9][10][11][12]
^Goran Calic, "Crowdfunding", The SAGE Encyclopedia of the Internet, 2018
^Gleasure, R., & Feller, J. (2016). Emerging technologies and the democratisation of financial services: A metatriangulation of crowdfunding research. Information and Organization, 26(4), 101–115.