Raising funds for your business can be a challenge. Crowdfunding — collecting financial contributions from many strangers not usually connected to the financial sector — represents an alternative to traditional forms of financing your business dream.

Crowdfunding is usually done over the Internet, for a fee, through crowdfunding platforms and funding portals. Participating in online communities dedicated to this type of fundraising can help you collect donations, offer rewards and take pre-orders. Equity crowdfunding is being considered by some provincial and territorial securities regulators, and could become an option in some regions. Stay informed about what you can and can't do.

CrowdfundingKeep in mind that by exposing your business idea to the public, you run the risk of having your ideas copied. Do your research to find out how to protect your intellectual property.

Many factors contribute to a successful campaign, including the number of people who see your campaign, and whether they buy into your idea. Telling a compelling story and raising awareness about your campaign are vital, so tools such as social media have an important role in promoting your campaign. Be sure to do some research to find the right crowdfunding platform to showcase your idea.

While crowdfunding will not work for every venture, it can be a way to test and validate your ideas and also to promote your business.

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