Crowdfunding involves raising small amounts of money from a large number of individuals to finance your new business venture.
It leverages the wide reach of social media and crowdfunding websites to connect investors and entrepreneurs, potentially increasing entrepreneurship by expanding the pool of investors beyond the traditional circle of owners, relatives, and venture capitalists.
Crowdfunding has allowed entrepreneurs to raise substantial amounts of money from a wide pool of investors. For example, one humorous Kickstarter project involved an individual seeking to create a new potato salad recipe with a modest goal of $10, but ended up raising over $55,000 from 6,911 donors.
Happyfunders is among the most popular crowdfunding platforms in Uganda. The platform supports mobile money in Ugandan Shillings.
So basically, Crowdfunding is the use of small amounts of capital from a large number of individuals to finance a new business venture. Depending on the type of crowdfunding, investors either donate money altruistically or get rewards such as equity in the company that raised the money.