Why equity crowdfunding?
So what's wrong with the other types of crowdfunding - why do equity crowdfunding?
Nothing is wrong with the other types of crowdfunding - we love them.
However equity crowdfunding is a great way to match companies who need funding with individuals who wish to invest. Investors get a share in the future success of a company they believe in.
Reward based crowdfunding (like Kickstarter and Indiegogo) can work really well, but if your company is not in the business of offering consumer products/services then effectively pre-selling will make success difficult.
Crowd-funded loans have also significantly increased but aren’t always appropriate when a company wishes to grow due to the interest and repayment commitments.
NESTA's report on equity crowdfunding here is worth a read.