Crowdfunding is one of the most promising financing options for innovative projects and sustainable corporate development today. More and more decision-makers and financial managers are discovering crowdfunding as a flexible and effective alternative to bank loans or traditional investors. Crowdfunding not only offers quick access to capital, but also strengthens brand loyalty because a committed community actively supports the project and acts as a multiplier[1][2]. In this article, we look at how you can use crowdfunding for your company, what the benefits and risks are and show practical examples from the industry.
How does crowdfunding work?
Crowdfunding is an innovative model in which many people finance projects together - usually via digital platforms. Anyone can participate, regardless of the amount of the contribution. Companies or project initiators present their concept to the public and, depending on the model, offer consideration, participation or interest. The crowd decides for itself whether to support the project and thus becomes part of its success[3][8].
BEST PRACTICE at the customer (name hidden due to NDA contract) and an example: an innovative brewery successfully financed climate-neutral beer via a crowdfunding campaign. Supporters received exclusive tastings and naming rights to batches. The campaign not only generated media coverage, but also created a strong community that later served as the first customer group.
BEST PRACTICE at the customer (name hidden due to NDA contract) and one example: a food start-up used crowdfunding specifically as a market test. Before major investments were made in production, the team collected capital and feedback at the same time. Supporters became product testers and ambassadors, which made the market launch much easier.
BEST PRACTICE at the customer (name hidden due to NDA contract) and an example: a sustainable fashion brand financed its first collection entirely through a reward-based campaign. Supporters received limited edition pieces and VIP invitations to fashion shows. This created a customer base in advance that actively promoted the brand.
The most important crowdfunding models
Not all crowdfunding is the same. There are different models that appeal to different target groups and needs. Reward-based crowdfunding is particularly suitable for creative products or innovative services because supporters receive a tangible reward, such as a prototype or exclusive access[8]. In the donation-based model, the focus is on the sentimental value, for example for social or ecological projects. Equity-based crowdfunding is relevant for high-growth start-ups that offer capital in exchange for company shares. Lending-based crowdfunding is aimed at companies that want to raise debt capital with fixed interest rates[4].
Advantages of crowdfunding for companies
Crowdfunding offers numerous advantages that traditional financing methods often cannot provide. Companies retain full control over their strategy and do not have to give up shares if they opt for reward- or donation-based models[1][6]. The campaign can usually be implemented quickly and cost-effectively because there is no need for time-consuming banking processes. Early market validation is particularly valuable: if a campaign is successful, there is clear evidence of the market attractiveness of the offer[2][7].
Another plus point is the increased visibility. A successful crowdfunding campaign generates attention in the media and social networks. Supporters become brand ambassadors and contribute to viral distribution. At the same time, a community is created that supports the company in the long term and provides feedback[1][2].
Another practical example: a tech company launched equity crowdfunding to develop a new app. Numerous small investors participated via an online platform. The campaign not only raised the necessary capital, but also provided valuable feedback on product development. The large number of investors also ensured a broader distribution of risk.
Risks and challenges of crowdfunding
Crowdfunding is not a sure-fire success and also brings challenges with it. The biggest risk lies in the fundraising itself - if the project falls short of expectations, no capital will flow. Companies must communicate transparently, position themselves clearly and address their target group in a targeted manner. Success depends heavily on the quality of the presentation and marketing[3].
For investors, there is a risk that projects will fail and the capital invested will be lost. There is no middleman to cushion the risk. Project starters bear a high level of responsibility because they are accountable to many people. Those who fail to keep their promises risk a loss of reputation and legal consequences.
One last example: a start-up in the field of sustainable packaging launched a campaign but was unable to deliver the planned product on time. The community reacted with disappointment, which led to negative reviews and reclaims. This shows how important realistic planning and open communication are.
Practical tips for successful crowdfunding
If you want to use crowdfunding, you should consider a few strategic steps. Firstly, a clear objective is important: what is to be financed and which model fits best? The next step is to select the right platform. In Germany, Startnext, Vision Bakery and Invesdor are established providers[1][4].
A meaningful pitch is crucial. Use videos, images and concise texts to present your idea in an understandable and emotional way. Involve your community at an early stage and involve potential supporters. Social media, email marketing and press work help to increase your reach. Also plan updates and thank you campaigns for your backers to strengthen the bond.
Professional support from experienced coaches can significantly increase success. As part of a transruption coaching session, you will receive inspiration for your campaign, learn about typical pitfalls and develop a customised roadmap together. Clients often report that external expertise was particularly valuable when it came to addressing target groups and storytelling.
Another example: A company from the creative sector focussed on concise storytelling elements and an emotional appeal. To this end, a landing page with a video pitch was created that was specifically tailored to the target group. The result: the funding threshold was reached after just a few days.
BEST PRACTICE at the customer (name hidden due to NDA contract) and an example: a company in the smart home sector financed its first product series via crowdfunding. The target group was activated in advance by offering exclusive webinars and live demos. The campaign exceeded expectations and created strong brand loyalty.
My analysis
Crowdfunding is a modern, agile financing option for decision-makers and CFOs that goes far beyond simply raising capital. It enables market testing, community building and increased visibility - and often faster and more cost-effectively than traditional methods. At the same time, crowdfunding requires transparency, commitment and a well thought-out communication strategy. Those who accept these challenges can sustainably strengthen their company and successfully realise innovative projects. Crowdfunding remains a central component of modern corporate financing and offers exciting prospects for the future.
Further links from the text above:
Crowdfunding - advantages and disadvantages at a glance [1]
Crowdfunding: advantages, models & best practice [2]
Crowdfunding with Invesdor [4]
Equity crowdfunding: definition, advantages, risks [5]
Crowdfunding for entrepreneurs [6]
Crowdfunding: types, advantages and disadvantages (iFunded) [7]
Crowdfunding and collecting donations (GoFundMe) [9]
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