How Does Crowdfunding Work?

How Does Crowdfunding Work?

Crowdfunding is pretty simple. Visit a crowdfunding platform, find something you want to invest in, send your money, and wait for results. The difference boils down to what crowdfunding sites you visit. The most common crowdfunding platforms allow you to invest in a project or product in return for special rewards, usually in kind.

There are, however, royalty financing platforms like TFGCROWD that promise substantial financial gains in return for investments in money and trust. In general, royalty financing platforms function as loan originators, building quid pro quo connections between investors and businesses. Think of it in terms of traditional initial public offerings (IPOs), where investors enjoy profits from the company shares that they buy. Except it’s not traditional at all: you don’t have to deal with banking intermediaries, and you’re not beholden to the caprices of a few investors.