Last week a Dutch news program (EditieNL, RTL4) had an item about crowd funding. In relation to the topic of next week which is crowdsourcing and crowd funding, I will give you a quick look into the world of crowd funding.
What is the best thing you could do in times of crisis? Saving money on a bank is not attractive because of the low interest rates. The fastest way to earn money is probably crowd funding.
Crowd funding is investing your money in (small) businesses. It is usually done on the internet and you don’t even need a bank. The biggest crowd funding platform in the Netherlands is Geldvoorelkaar.nl. This platform is a market for people that want to borrow and who want to lend money. The money borrowers can be consumers and companies.
Should you do it or not?
The Geldvoorelkaar.nl website shows us a lot of investments. You can even start with a small amount of money for a 7 to 8 percent interest. So you can ‘donate’ to someone who likes to start a gym but has not enough money him/herself.
What are the advantages and disadvantages of crowd funding?
- You can invest also a small amount of money;
- Interest rates are higher than saving money on a bank;
- Risks are low, but you must know how you get your money;
- You can choose which consumer of business you like to help to reach their goals yourself.
- The company you invest in can go bankrupt;
- You can’t determine the credibility of the one who needs the money;
- Risks are higher than saving money, there is no profit guarantee.