How to Create a Crowdfunding Platform

The crowdfunding business is still relatively new and doesn’t require as much effort as other forms of funding your start-up, which is exactly why it has a huge potential. So, if you want to create a crowdfunding platform to be one of those who bring fresh ideas and donors together — welcome!

🗂️ Niches for Crowdfunding Platforms & Platforms Case Study

To help you better understand each niche from its technical and simply not most obvious sides, we’ve prepared a list of the most helpful features that can be used in each crowdfunding platform niche.

Exclusive content or goods

The most famous crowdfunding platforms for sharing content are Kickstarter and Patreon. And while Kickstarter has the usual crowdfunding news feed (you see all creators looking for funding and some of the content they offer for it), similar to other Social Networks, Patreon has a more advanced way of collecting funds. It’s based on a subscription system: you choose an artist, follow them for a fee, and only then you can see their content.

Patreon has one great feature you should take note of — since this platform is used mainly by well-known creators, the site offers users to connect with Social Networks and see if people they follow use Patreon or not. This way, you can easily redirect users to your platform from other Social Networks.

Moreover, to satisfy the needs of those who have a specific request on who they want to invest in, you can add filters by category or geolocation so that your users will know which creators are available within the set filters.

PeerStreet, on the other hand, allows investors to book spots as soon as sales start. Therefore, it emphasizes the importance of quick but strategic decision-making, which is also the truth about real estate.

There’s also an opportunity for PeerStreet users to automatically reserve a certain project. Donors can set up specific project criteria. Then, as soon as a suitable offer appears, donors are given a reservation for 24 hours so that they can look at the project. If they find the project not suitable, they can simply cancel the reservation.

Additionally, PeerStreet has a deposit feature. Backers can put money on deposit, get interests, and later invest the money in real estate.

💻 What is better: open-source, white-label, or custom software development?

When you have decided on the niche of your platform, you can already think about the way to make it a reality. There are three approaches to building a platform: open-source (like WordPress), white-label (like LenderKit), and custom development. To help you decide which method is right for your project, we created a table with the advantages and disadvantages of each.

The most popular payment gateways are PayPal and Stripe. But it is better to choose the systems which suit your crowdfunding business model. For example, the best choice for a startup crowdfunding system that works only with certified investors will be payment gateways with automatic KYC/AML checks.

💳 How to Choose a Payment System Suitable for Crowdfunding

The payment system is the main tool in a crowdfunding platform. Apart from basic payment functionality, such a business requires a higher security level. We looked at some payment systems that can make the payment process safe and legally compliant. Here they are:

You can surely combine all 3 of these monetization strategies to get a diversified source of income. Just make sure to keep the balance.

💡 Takeaways

Starting your own crowdfunding platform might be really challenging. However, with the right approach, it will definitely be worth it — being a vendor for money turnover has always been profitable.

Let’s summarize what we’ve talked about in this article and what the “right approach” is:

• Think about your niche. Both the functions and the design of your crowdfunding platform will depend on it.
• Choose whether you will create your site with an open-source or white-label option, or it’ll be easier to create your own platform.
• Don’t forget about the KYC/AML tools.
• Perform regular checks on both campaign creators and investors.
• Make sure to choose fast and reliable payment gateways.
• Choose in which way you’ll monetize your site.

If you still have questions on how to start a crowdfunding website or need help with development –– our team would be happy to help you! Press the button below and we’ll be there in a blink!