Crowdfunding: Online Charity or a Modern Tool for Innovative Projects Implementation?

Abstract

Crowdfunding is a promising field of financing high-risk innovative projects. The start-up developers raise money needed for their start-up implementation on a crowdfunding-platform by means of the Internet. The investors may also include ordinary citizens who wish to support this or that original idea and contribute to its implementation. The possibility of access to a completely new product (and before the official sales) is the main motive for financing projects.

Crowdfunding as a tool to support sustainability‐oriented initiatives: Preliminary insights into the role of product/service attributes

“…Furthermore, Moritz et al () expect that, in donation‐based CF, what matters is the presentation of the social value of the project, whereas in reward‐based CF, the presentation of product features. The debate whether CF could be considered an online charity or a tool for entrepreneurial initiatives is still open (Profatilov et al, ). However, reward‐based CF platforms such as Kickstarter keep away from the donation model, explicitly stating that “projects can't fundraise for charity” and “While nonprofits are welcome to launch projects on Kickstarter, projects can't promise to raise funds to donate to a charity or cause.” Rather, “Projects must create something to share with others.” Hence, reward‐based CF platforms can be viewed like platforms for (risky) preordering of not yet developed products/services, rather than channels for donations.…”

“…First, the choice of focusing on a reward-based platform lies on the fact that to date, reward-based CF is one of the most prominent models of CF for product and service innovation in terms of both scale and breadth (Cholakova & Clarysse, 2015). , the worldwide CF platform activity report (Profatilov, Bykova, & Olkhovskaya, 2015) claims that Kickstarter is the most popular reward-based platform internationally. Third, unlike other platforms, it is neither restricted to projects with a fixed funding target nor restricted to funders from the United States.…”

“…The debate whether CF could be considered an online charity or a tool for entrepreneurial initiatives is still open (Profatilov et al, 2015). However, reward-based CF platforms such as Kickstarter keep away from the donation model, explicitly stating that "projects can't fundraise for charity" and "While nonprofits are welcome to launch projects on Kickstarter, projects can't promise to raise funds to donate to a charity or cause."…”

Crowdfunding and Diaspora Philanthropy: An Integration of the Literature and Major Concepts

“…What literature does exist focuses mainly on investment-based crowdfunding rather than donation-based crowdfunding (Agrawal et al 2011;Antonenko et al 2014;Belleflamme et al 2013Belleflamme et al , 2014Best et al 2013;Bradley and Luong 2014;Ley and Weaven 2011;Ordanini et al 2011;Shiller 2013), although within the research on investment-based crowdfunding there is a growing work on crowdfunding social enterprises (Lehner 2013). Much of the literature that discusses donation-based crowdfunding focuses on donations as a possible starting point for business opportunities rather than purely for social benefit (Best et al 2013;Mollick 2014;Ö zdemir et al 2015;Profatilov et al 2015;notable exceptions being Lehner 2013;Saxton and Wang 2014). An exception to this is the small but growing body of literature on civic crowdfunding, a subset of crowdfunding activities, through which citizens collaborate with government to fund projects meeting public needs (Davies 2014(Davies , 2015Hollow 2013;Stiver et al 2015).…”

Crowdfunding in Russia: An Empirical Study

“…Some of them consider crowdfunding as a perspective tool for start-ups development. (Profatilov, D.A., Bykova, O.N., Olkhovskaya, M.O., 2015). Sokolov (2015) pays attention to crowdfunding opportunities for political activities.…”