Crowdfunding sites for individuals are becoming more prevalent. “Regular” peer-to-peer loans are still helpful for the person getting the money since they may offer a lower interest rate, better terms, or even the possibility of funding to someone compared to more traditional funding vehicles. But sometimes, the person needs charity for a specific purpose or need. In other words, some investors use crowdfunding sites for personal needs to fulfill a personal cause or mission. While they may expect something of a return, they offer specific and sometimes deep discounts on what they expect as a return. Our crowdfunding services cover crowdfunding sites for individuals.
Crowdfunding Sites for Individuals: Overview
Crowdfunding sites for individuals allow the investor to support a cause they believe in or to help a group of people to whom they feel connected in some way. Some examples include:
- Allowing more people to adopt even if they don’t have the sometimes high initial costs
- Helping solve a particular challenge that the person faces, such as needing transportation to get to a new job or paying for child care so a person can work
- Helping homeowners to install renewable or alternative energy.
- Providing educational support to less fortunate people, perhaps coming from the same background as the funder or pursuing a course of study the funder believes in.
- Starting a nonprofit in an area the investor believes in or undertaking a project that will pay off in a way the investor believes in
- Giving certain groups a start in one way or another, such as allowing for home ownership
Crowdfunding Sites for Individuals: Process
Once the investor has decided which opportunity they might want to invest in, the terms must be worked out. Sometimes, the person is reaching out through crowdfunding sites for personal needs has a charitable purpose and requests specific terms, while in others, the investor takes control of this part of the process. In the end, the crowdfunding sites for individuals can be used to provide philanthropy to a project in three ways:
Crowdfunding Sites for Personal Needs Payback
Sometimes, only part of the person-to-person loan is expected to be paid back by the charity. Perhaps it’s a percentage or certain parts of the loan broken down by purpose. The investor through crowdfunding sites for personal needs may want some money back and is giving the charity a leg up as they make their pitches or need overhead. But they expect that once the charity gains a footing, they’ll use some of their revenue to repay some initial loans.
The loans may also be wholly forgiven if specific goals are met, such as completing an education or project successfully. In this case, the investors through crowdfunding sites for individuals will forgo any payback because they provide a charitable donation. Still, they attach strings such as insisting that the person raise an equal amount from other investors or that they complete the core project being funded.
Finally, the person-to-person loans may act more like donations, and no real payback is expected. In this case, it is still peer-to-peer lending because the investor is keeping track of what they would have received back had they gone a more traditional route, but the terms are meant only to help determine value for taxes and other purposes.
Crowdfunding Sites for Individuals: The Investors
In all three cases, using crowdfunding sites for individuals is philanthropy, at least partly. But instead of making a traditional donation or contribution, the funders are asking for the same homework and due diligence that regular peer-to-peer loans require. The funders could be sure that their investment, even if partially philanthropic, would pay off more deeply.
Crowdfunding Sites for Personal Needs: Example
Green Crowdfunding is an excellent option if you are an investor looking to make an impact on the environment, regardless of what the monetary payback will be. Thus, this is a common use of crowdfunding sites for personal needs. Suppose you have an idea or a solution that can save energy, 
clean up environmental problems, or produce an alternative energy source. In that case, crowdfunding sites for individuals may be a great route if you are looking for this type of investor. Of course, this area is highly competitive for apparent reasons – many worthy ideas but not an unlimited supply of investors and crowdfunding sites for individuals.
Green Crowdfunding is relatively new but increasingly popular in the peer-to-peer market. Most Green Crowdfunding asks precisely what you might assume, having to do with funding for projects or inventions that have to do with renewable or alternative energy or other projects that protect the environment. In most cases, the projects are purely charitable – in other words, the investors are giving money to fund a new idea that has potential, and their hope goes no further than the idea that this project could meet success and help people or companies use less oil, replace harmful chemical, or reduce problematic emissions.
Crowdfunding Sites for Personal Needs: Payback
Most Green Crowdfunding is charitable, and payback through crowdfunding sites for individuals is either not expected or only minimal, such as a zero-interest peer-to-peer loan. However, some types of Green Crowdfunding look more like investments than charitable contributions. While the investors may still choose the Green Crowdfunding approach due to a commitment to green causes, they expect some payback. They may either fund a project like an invention with the idea that they will get some equity if it becomes commercialized or provide a low-interest peer-to-peer loan that must be paid back. There are middle-ground choices, where the investor, through crowdfunding sites for personal needs, provides some charitable philanthropy initially. Still, Green Crowdfunding moves into more traditional peer-to-peer loans as the project progresses.
Advantages of Crowdfunding for Personal Needs
The main advantage of Green Crowdfunding through crowdfunding for individuals is obvious: The investor commits to nature and the environment and wants to see products and systems developed to keep businesses running and families comfortable while reducing our chemical and carbon footprint. But of course, beyond that, there is a growing strong market for green products and services as corporations and governments look for green solutions, whether due to regulations, ideals, or cost savings. In other words, Green Crowdfunding, while usually a highly positive charitable endeavor, can also be profitable. This is an excellent choice for the investor willing to get a little less financially but wants to invest in something that can make the world a better place. The advantages for the person or company receiving the investment are evident, of course, and include getting money more cheaply and under better terms through crowdfunding for personal needs than through a traditional bank loan.
Disadvantages of Crowdfunding Sites for Individuals
Some might argue with our word “disadvantage” here, but crowdfunding for personal needs is not likely the most fruitful choice if an investor wants maximum financial returns. The same goes for the person or business looking for an investment – it may be harder to get the maximum money or most favorable terms in this area since so many projects either fail or do not become as profitable as they initially hoped. Crowdfunding for individuals is a very competitive market, especially for the more generous situations such as an interest-free loan or a loan that only requires partial payback. You may have to work quite hard to get an investment. Of course, investors are taking a risk that they are investing in something that may not have much of a financial payback and will not emerge in a crowded market.
Crowdfunding Sites For Personal Needs Conclusions
We wish you success in this critical area, whether you are an investor or looking for investment through crowdfunding sites for personal needs. If you want an investment, we can help connect you to the right platforms and help with your pitch, and if you are an investor, we can help you find crowdfunding sites for individuals that match your goals. Contact us any time.
