Personal crowdfunding involves making a pitch for money for a project or purpose that is not business related but instead has meaning to you, your family, or a group. Personal crowdfunding does not encompass equity crowdfunding at all, and it might or might not involve rewards. In other words, you may give something or a reward for those who invest, or you may just receive money from those who feel intrinsically rewarded by providing you the cash. Personal crowdfunding also provides a path for people you know, even family, to send you money in an organized fashion. On this page we go over personal crowdfunding from the view of the “investor” (in this case maybe donor is more appropriate) and the person with the personal cause.
Types of Personal Crowdfunding
Before we go into how to get personal crowdfunding and how to invest we should go over some of the types of this type of crowdsourcing that may exist. Here are five of the more popular possibilities.
Personal crowdfunding for an event
Personal crowdfunding for an event: This type of crowdsourcing may be used to fund a wedding, bar or bat mitzvah, or anniversary trip. People may be motivated to give money to these requests because they want to support a certain type of person, perhaps someone who has faced certain challenges or comes from a particular background, or they may know the requester and are giving in an organized fashion to him, her, or them. This may or may not be “rewards-type” in that you may receive something of value related to the trip or event.
Personal crowdfunding for a mission trip
This type is basically self-explanatory. If you are planning to go to an underprivileged area or one that was just struck with a natural disaster, then you may turn to the crowd for assistance. Usually there is no reward beyond perhaps getting updates in the form of photos or videos. Your hope is that either people you know and spread the word to, or even people in the crowd who you do not know but are looking to fiund something, will invest in your mission.
Personal crowdfunding for a charitable cause
Similar to the above, you may look for personal crowdfunding for a charitable cause you are collecting for. Everything from an environmental cleanup to helping a family in need to rescuing an animal could be in this category. And like the above you might be setting up a personal crowdfunding site that you will send people you know to through word-of-mouth or that you will hope you can promote through search engine optimization and the like.
Online fundraising for a project
You might turn to the crowd for a project you are working on. Maybe you are installing a renewable energy source, or building a baseball field in your back yard. Perhaps you are putting together a play or a musical. Or maybe you are creating a work of art. In any of these cases you may need funding, and they all may do well with personal crowdfunding that allows you to keep people updated on your progress and give them motivation to invest.
Crowdfunding for Personal Debt
Applying for Personal Crowdfunding
Getting personal crowdfunding is not a complicated process, but it does require time and effort. You need to spread the word about your cause or project, and set things up so people who might invest can find you. Then you need to make sure you are providing the updates you promised so that people feel good about their investment. There are basically three steps to applying for personal crowdfunding:
- Craft your pitch: You need to make sure you have written a detailed description of what you are going to do with the money and why. This pitch needs to be brief enough that the crowd will not lose focus.