Crowdfunding is an alternative to raise funds for a startup, a project or a creative idea. The crowdfunding concept allows an entrepreneur to reach out to a ‘crowd’ of people for a financial pledge in return for a small stake or some incentive. This is unlike an Angel Investment concept where a single person may have a large stake in a startup. While some investors may be hesitant to invest in a new idea, crowdfunding provides an alternative way to source seed capital from a number of backers. The concept is popularized by Kickstarter.com in the United States. The majority of crowdfunding platforms don’t charge you for publishing a pitch; however they typically take a commission of around 5% when you reach your financial funding target. If you don’t meet your financial target, no money is exchanged.
We recently came across a few initiatives of Crowdfunding in the Middle East region.
One of them is Mawwell.com. At present you need to sign up for an invite to join Mawwell.com
The invite says: -
“Project creators will keep 100% ownership of their work and will build a unique relationship with their contributors
- Not all projects will be eligible to be part of Mawwell. Indeed, Mawwell will not be a place for soliciting donations to causes, charity projects, or business expenses
You do not have an idea yet but want to contribute?
- Whether you have an idea yet or not you can:
- Support projects you like
- Discover talent
- Share these projects with your friends.”
There is another site called Aflamnah.com, claiming to be the first crowd-funding initiative in the region. It is scheduled to launch on 01 July 2012. Aflamnah aims to help independent filmmakers, artists, students and innovators to raise funds for their projects by getting people excited enough to financially support their idea
Individuals must post the information related to their idea via the Aflamnah website and once approved their idea then has to meet a self-assigned target within 28 days. If a project doesn’t meet its goal then no money is exchanged. Aflamnah Principal Founder, Vida Rizq has announced that they have 4 confirmed projects that it will launch with on July 1
Both the websites seem to run like Kickstarter in the U.S where interested people can donate money to projects of interest.