Thursday, May 21, 2015
Depends. What is the stage of your business?
Crowdfunding may be good to get a business concept started, but Crowdlending is better for growing it. Crowdlending will help you raise more money faster, once the market demand is established and the business model is proven.
Simply put, Crowdlending helps you get a loan, not a gift. You pay back the money with interest, rather then provide rewards to supporters.
Let’s take Jenny for an example.
Few years ago Jenny was the first to offer Italian style espresso in her community. She put down 3 months of rent on a tiny space and funded the
purchase of a second hand espresso machine by offering free coffee, cookies, and T-shirts in exchange of donations from the first espresso enthusiasts.
Jenney’s Coffee Shag was a success. The line in the morning grew ever longer.
Jenney decided to expand into Jenny’s Coffee Shop. But how much more cookies and coffee can anyone eat and drink?
Jenney launches a Crowdlending campaign instead. She offers to borrow the money, promising to repay it on a schedule and with interest. Now, her friends and customers can help her out and earn interest on their capital, as well as enjoy a shorter line for their morning espresso. It is a win-win for everyone.
Where can you crowdfund a loan in Texas?
You have to set up your crowdfunding campaign on a Texas registered crowdfunding portal. There are currently only two registered portals that specialize in debt, and they are quite different: Lendoor and NextSeed. The first facilitates term loans, and the latter does revenue sharing loans.