The 6 Top Crowdfunding Platforms of 2020

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The digital era has made raising funds for your business idea, nonprofit cause, or personal needs easier with the use of online crowdfunding platforms. To date, people have raised more than $34 billion worldwide using these platforms, with easy-to-use tools that provide a smooth experience for both fundraisers and their supporters. Whatever your reason for raising money, there is a crowdfunding site for you. 

To help you get started, we researched and reviewed the top crowdfunding platforms. We selected the top six based on their ease of use, history of generating fundraising success for their customers, pricing options, social media integrations, and more. Whether you are an entrepreneur, an artist, or a climate change advocate, these platforms will help you get the funds you need for your project, idea, or cause. 

The 6 Top Crowdfunding Platforms of 2020

Indiegogo: Best Overall

Indiegogo

 Indiegogo

Indiegogo is a clear choice for best overall for its track record of success in helping to fund more than 800,000 ideas all over the world since 2008.

Pros
  • A+ rating with the Better Business Bureau

  • Great for entrepreneurs and investors

  • Worldwide operations

Cons
  • Charges a 5% platform fee plus a third-party payment processing fee

Indiegogo, Inc., was founded in 2008 by Danae Ringelmann, Eric Schell, and Slava Rubin as these founders sought to fund their own causes and ideas. Today, more than 10 million people visit the Indiegogo site on a monthly basis where about 19,000 campaigns are launched every month. 

With Indiegogo, which is available in 235 countries and territories, you can create a crowdfunding campaign for any idea or product that you want to launch. To get started collecting funding using the site, you can set up a campaign for up to 60 days, the fee for which is a 5% platform fee plus a 3% to 5% third-party processing fee.

Their tools allow you to integrate with other platforms, including Facebook and Google, to promote your campaign. Once you are done raising money, you'll receive it via your bank within 15 business days. You can also invest in one of the many thousands of ideas and products and become a backer. 

Indiegogo is an accredited business with the BBB with an A+ rating.

The overall success that so many fundraising projects have seen with this simple platform makes it our best overall pick.

SeedInvest Technology: Best for Startups

SeedInvest Technology

 SeedInvest Technology

For startups looking for funding to get off the ground, SeedInvest Technology has attracted more than 300,000 investors and helped over 200 startups raise more than $200 million in financial backing, making it our choice as best for startups.

Pros
  • 200+ startups funded

  • Helps raise awareness among venture capital firms and angel investors

  • You don't have to pay any fees if your fundraiser isn't successful

Cons
  • All startups go through an intense vetting process, but not all are selected

SeedInvest Technology, with headquarters in New York City, was founded in 2012 with the goal of providing a way for investors to back early stage startups. To date, they have funded more than 200 companies making it ideal for ventures needing startup capital. 

If you are a founder and want to raise money through SeedInvest Technology, you will need to sign up for an account with SeedInvest, fill out an application, and complete a screening process. This will include a due diligence check. If you are invited to fundraise on the platform, you will need to create a profile and then you can begin the fundraising process. When you close your round, SeedInvest will take a cut of your earnings, including a 7.5% placement fee and a 5% equity fee. 

You can use the calculator on their website to get an estimate of how much it might cost you to raise money using their platform. The length of a campaign will depend on your business but can take anywhere from 45 days up to six months.

Mightycause: Best for Nonprofits

Mightycause

 Mightycause

Mightycause is our choice for best for nonprofits because it offers nonprofits one of the lowest-cost platforms for raising money, while also offering select tools for free.

Pros
  • Compatible with customer relationship management (CRM) systems, like Salesforce

  • You can request a demo for free

  • Social media integrations available

  • Option to set up year-round fundraising, special events, giving days, and crowdfunding campaigns

Cons
  • Features like CRM integrations are a part of the platform's paid plan

Mightycause was founded in 2006 as a fundraising platform to help nonprofits and individuals raise money online for their causes. Its flexibility for fundraising gives it the edge in this category for organizations seeking donations, as it has helped more than 150,000 causes attract the contributions they needed to meet their goals.

The platform offers a range of campaigns, from peer-to-peer fundraising to giving days. Mightycause charges an average processing fee of 0.81% of the money you raise using the platform plus 29 cents per transaction. The platform offers a free "starter" option, where you can raise money and create fundraising campaigns that are year-round, peer-to-peer, event-related, and more. 

You also have the option to upgrade to the "full-services advance plan," which is a paid version that gives you more features for branding, marketing, and donor management, all for only $99 a month and you can cancel at any time. 

Nonprofits can raise funds themselves or individuals can set up a fundraising campaign for their favorite organization.

StartEngine: Best for Investing

StartEngine

 StartEngine

StartEngine is a standout option for those looking to invest some money because the platform allows everyday people like you to put your money directly into companies and startups you admire and get equity in return, for as little as $100 to start.

Pros
  • Can invest as little as $100

  • More than $150 million raised

  • Kevin O'Leary, TV host on ABC's "Shark Tank" is a strategic advisor of the company

Cons
  • Relatively new company

Founded in 2014 by Ron Miller and Howard Marks, with Kevin O'Leary, TV host on ABC's "Shark Tank" as a strategic advisor, StartEngine is a platform that enables people to become investors in early stage startups. This lay-person-friendly investment approach is why it is our pick as best crowdfunding platform for investors.

You can get started investing in any of the companies listed on its website, from biotech pioneers to travel and tourism startups, with as little as $100, depending on the share value listed for the given company. To help you make an informed investment, each company's profile includes the company's valuation, price per share, number of investors, and more. 

When you're ready to invest, simply click the "Invest Now" button and start the process by filling out your personal information and method of payment. If you are a startup trying to get funds, the platform has helped 375 businesses raise funds through its network of more than 2,750,000 investors.

GoFundMe: Best for Individuals

GoFundMe

 GoFundMe

A versatile platform that's helped individuals raise funds for everything from personal healthcare expenses to keeping local businesses alive, GoFundMe is a clear pick for personal fundraising needs. Its track record of success includes bringing in more than $9 billion in funds from over 120 million donations.

Pros
  • 0% platform fee

  • Flexibility to raise money for yourself, a friend, or a charity

  • 24/7 expert support available

Cons
  • Credit and debit card transaction fees

GoFundMe was launched in 2010 and has become one of the largest fundraising platforms online, having raised more than $9 billion from over 120 million donations. Its success and simplicity help make it the best platform for individuals. 

You can set up a GoFundMe page in three simple steps. First, create your campaign by detailing the amount of money you want to raise. Next, tell your story, which can include photos and videos. For the final step, share your campaign with your friends and family via social media, text message, and email. 

You can manage the donations you receive via the platform's dashboard, where you can send thank-you notes, withdraw funds, and more. A benefit of GoFundMe, compared to other platforms that charge platform fees plus processing fees, is that this platform has a 0% platform fee. The company does have a processing fee, which is 2.9% and $0.30 per transaction. You can raise money for as long as you want—there are no time limits or deadlines. 

GoFundMe offers 24/7 expert support, in the event you need any assistance setting up your page or have any questions.

Patreon: Best for Creative Professionals

Patreon

Patreon

With easy-to-use fundraising and subscription options for artists and other creatives looking for "patrons," the Patreon platform is trusted by over 200,000 creators, including podcasters, musicians, artists, and writers.

Pros
  • You can create monthly subscriptions

  • Software integrations are available with Vimeo, MailChimp, and more

Cons
  • Fees start at 5% and go up to 12%, depending on the plan level you choose

Patreon was founded in 2013 by YouTube musician Jack Conte and, to date, the platform has attracted more than 200,000 creators and helped these professionals bring in $2 billion in funds, making it the clear winner for best for creative professionals.

Patreon is a crowdfunding platform designed specifically to help creative people thrive by helping them raise funds from friends, family, supporters, and admirers. It's free to get started with Patreon, however, there is a monthly fee depending on which of the three available plans you choose. The "Lite" plan charges a 5% fee from the money generated on Patron, the "Pro" level takes an 8% cut, and the "Premium" plan takes 12%. Plus, the company charges a processing fee of 2.9% and $0.30 per payment. 

The Lite plan is targeted at creators who are getting started, while Pro is designed to help creators establish membership options to support their business, and Premium is for established creators or businesses that generate more than $5,000 a month on the platform and have a minimum of 100,000 social media followers. All plans include the use of the Patreon mobile app, business tools, and more.  

You can switch between the Lite and Pro plans at any time, while the Premium plan requires a minimum of a three-month commitment.

What Is Crowdfunding?

Crowdfunding is a way to raise money online, whether it is for a creative pursuit, business idea, or personal cause. Startups, small businesses, nonprofits, and everyday people use crowdfunding platforms to help them connect with people to support them and help them reach their monetary goals to launch a business or product or support their mission.

How Does Crowdfunding Work?

When you use a crowdfunding site you will need to register and create a profile, then you can create your own personal campaign or fundraising page where you can tell the story of why you are raising money and what you need it for, set up a fundraising goal, and start raising money. Depending on the type of crowdfunding site you decide to use, you can start collecting the money within days. Some sites have 30-day campaigns (or longer). Funds are deposited directly to the financial institution account you link to your fundraising account upon registration. 

What Can Crowdfunding Be Used for?

The money you generate through crowdfunding must be used for the exact purpose you share with your donors or investors on your crowdfunding site. For example, people can raise money to help pay for a medical emergency, small businesses can raise money to keep growing in exchange for goods or services they provide, nonprofits can use their crowdfunding to keep supporting their mission, and more. 

Also, individuals looking to invest in startups through crowdfunding buy shares at a given amount of money. Keep in mind that you will see your return of investment if the company is sold or goes public or you may also lose your money if the company fails to take off and has to shut down. 

What Are Expected Crowdfunding Costs?

Most crowdfunding sites charge a platform fee that's a percentage of the money raised in addition to charging a payment processing fee of around 2.9% plus about $0.30 per transaction. For the companies listed in this article, the platform fees range anywhere from 3% to 5% for Indiegogo to 5% to 12% for Patreon. 

How We Chose These Crowdfunding Platforms

We took a look at more than 25 crowdfunding sites that offer a variety of services used to raise money for personal causes, business ideas, nonprofits, startups, and more. We narrowed down our list to these top six based on the platforms' usability, pricing, tools offered, success rates, marketing and third-party platform integrations, and payment options.

Article Sources

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  1. Fundly. "Crowdfunding Statistics for 2020."  Accessed September 23, 2020.