Watch this video for an overview of ways to finance your business, including crowdfunding.
What is crowdfunding?
Crowdfunding is an alternative way of financing where you raise money from the general public. You do not have to go to a bank or other financing institution. Apart from money, crowdfunding also gives you brand awareness and binds customers to your business or project. In addition, you can measure the need for your product or service.
How does crowdfunding work?
You can raise money through crowdfunding in different ways. The main forms of crowdfunding are:
- donation with non-financial payback, usually in the form of a product or service
- donation without payback
- convertible loan (ultimately convertible into shares)
- shares (as an investment: remuneration depending on the result)
A combination of these forms is also possible. All forms have different tax consequences (in Dutch). So, get information from the Netherlands Tax Administration (Belastingdienst) before you start crowdfunding.
Not only for startups
Crowdfunding is an interesting way for both startups and established entrepreneurs to raise money. Established entrepreneurs often have a large network already. But as a startup, how do you find an audience? Crowdfunding usually goes through a platform. That is a website where you can present your idea and raise money. KVK offers a list of the 5 biggest crowdfunding platforms.
In the crowdfunding register (in Dutch) of the Authority for the Financial Markets (AFM), you can see which crowdfunding platforms have received a licence or exemption.
Does crowdfunding suit you?
Does crowdfunding suit your organisation? Check whether you meet the following conditions:
- You have an appealing plan, indicating what the requested funding is needed for.
- You have an enthusiastic network of people willing to invest.
- You offer an attractive and clear payback, a quid pro quo.
Starting with crowdfunding
Do not underestimate it. A successful crowdfunding campaign involves a lot of time, knowledge and energy. First of all, you need to have a convincing plan and mobilise your entire network. See the step-by-step plan to start crowdfunding.
Trade association Nederland Crowdfunding
Nederland Crowdfunding is the trade association of crowdfunding platforms for business financing. The industry association aims to encourage crowdfunding. Do you want to get started with crowdfunding? They can help you get started.
Help with funding
Enlisting help will increase your chances of getting funded. With the right adviser and good financial backing, a 'yes' to your funding request is within reach. These advisers will help you on your way.