Millions of pounds have gone in to thousands of crowdfunding projects, but do the businesses ever come to market?
Alternative finance has grown in popularity in the past five years. Benefiting many thousands of businesses in need of funds required to grow and prosper.
But the big question is whether they actually do thrive and become the next big thing.
Reward-based crowdfunding platforms such as Indiegogo, Kickstarter and the biggest UK platform, Crowdfunder.co.uk have helped thousands of ideas, prototypes and start-ups gain amounts from £100 to £15m.
Some sceptics see the crowdfunding of quirky ideas and funky tech initiatives as a quick hit.
But it is an e-commerce mechanism with the rewards part of the cycle essentially selling a product. The most successful being a good demonstration of this.
The Pebble watch raised almost £7m on Kickstarter in 2012 and essentially guaranteed a raft of pre-orders in the process.
It rapidly turned into a business success story and has since gone on to crowdfund its recent product launch – raising a further £13m in the process.
Of course, these are the stand-out examples of crowdfunding and it’s not all multi-millions.
In fact, the vast majority of businesses raise significantly less but it doesn’t stop them from achieving business success.
This week, Indiegogo crowdfunding project FOBO came to market through UK retailer Maplin.
Initially a concept from Malaysia, the entrepreneurs behind “the world’s first Bluetooth tyre pressure gauge” raised £125,000 to get the first full production under way. Goal achieved.
Yet more came of crowdfunding than they had expected. It was spotted by UK investors and after some successful negotiations, has now found its way onto the UK’s high-street.
The device helps tackle safety concerns surrounding dangerous under or over-inflated tyres that may lead to an accident.
According to EU figures, under-inflated tyres are a contributory factor in 9% of all fatal road accidents and 41% of serious injuries on our roads.
In addition, drivers with unroadworthy tyres can face penalties of up to £2,500 per wheel.
Other popular crowdfunding campaigns this week
According to social media research by Opinium, Indiegogo’s Smart Tracker, a device which allows you to track the whereabouts of anything, is the most talked about social media crowdfunding project this week with 3,226 tweets.
Lynk, a security fob protecting your mobile or tablet data, and Gbreeze, a purifier project on Kickstarter gained 1,120 and 992 global tweets respectively.