The concept of social lending and giving is getting more popular by the day. In the year 2013, significant progress was made both in the technology of social lending and giving called crowdfunding, and in the types of projects that were pitched for funding from crowdfunding platforms.
Crowdfunding provides an exciting opportunity for investors who want to do something different from the traditional way of investment. Investment in crowdfunding can be for profit or not for profit. This chapter is dedicated to the discussion on investments for profit in a crowdfunding project.
It is thought by industry observers that crowdfunding investors provide loans to the borrower and the business community at a rate and condition that is friendlier than those offered by traditional lending organizations like banks and angel investors. There are many exciting opportunities to be part of the new way of funding projects and businesses. Opportunities are there for everyone that wants to be part of it.
Potential investors need to understand the dynamics and mechanics of crowdfunding. Investors are advised to dig a little deeper to identify and understand the business and projects to pair and partner with while still being profitable. Investment experts warn that investing in early stage business or startups could be risky. Investors are to take due diligence to mitigate the risk of loss.