Crowdfunding campaigns raise funds for businesses Through individual small contributions from a big pool of contributors.
There are three types of crowdfunding:
- Crowdfunding With Equity – Investors get shares or profits.
- Rewards/Donation-based crowdfunding – Money comes in through donations. There’s a rewards program, Usually a product or service.
- Debt Crowdfunding – Early-stage companies attract investors who charge high-interest rates for business loans and the amounts are small.
This system works well for real estate investing as investors commit lower donations or capital towards any single property. It’s a great way to diversify your stock market portfolio. You just need to lock in the money for several years.