Raising Money From Crowdfunding

Crowdfunding describes raising small amounts of money from many people. Securities crowdfunding (also called equity crowdfunding) is a way for businesses, particularly start-ups and small businesses, to raise capital. 

The equity crowdfunding model involves investors backing a small or start-up business in exchange for shares or another eligible security. 

This is also known as securities crowdfunding.  Individuals can invest in entrepreneurial start-ups through an intermediary, known as a “funding portal.”

In return, investors receive securities from the business. This means they may become part owners of the company, as they would if they had purchased a share or stock on an established stock market.