What is crowdfunding?

Crowdfunding is a general term for the process of raising money – "funds" - directly from "the crowd". Typically, the crowd is constituted of a large number of persons each of whom contributes a small sum of money to a specific purpose.

What do we mean by a "person"?

For crowdfunding purposes, a "person" is a rather legalistic entity, whose definition takes us a long way from common-sense, everyday language. A human being is a person in the eyes of the law, as is a big company. So Mrs Smith is a person, and so is Rolls-Royce plc. Both Mrs Smith and Rolls-Royce are capable of being among the persons who make up the crowd that does the funding. We'll go into more detail on who's in the crowd later.

What's the "purpose" of crowdfunding?

As we say, crowdfunding is a general term for the process of raising money. Back in the early days of email, people who raised money for charity by emailing all their friends in a big group email were doing a primitive form of charity crowdfunding. Other common purposes for crowdfunding are to raise share capital investment (the person in the crowd takes a direct stake, or shareholding, in the company seeking funds). Many commentators say this process rather risky, and that a high percentage of the typically young companies seeking funds fail. It is known as equity crowdfunding.

The purpose of the fund raising on Money&Co.is to lend money to much more mature, developed businesses with a strong profit record. The process does not involve investing, but lending money. Its technical name is credfund lending, or peer-to-peer (P2P) business lending (a person, human or corporate, lends to a business).

Money&Co. is in the P2P business-lending sub-sector of crowdfunding and is part of the fast-growing trend in crowdfunding loans, quick, fast, and at rates that work for borrower and lender alike.

Our 3 most popular articles on crowdfunding...

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Equipment Company
General business growth

B+

Risk

48

Months

7.2%

Interest

£540,000

24%

Closing in 14 days

The Loan

The Business

Equipment Company
General business growth

B+

Risk

48

Months

7.2%

Interest

£540,000

24%

Closed

The Loan

The Business

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Equipment Company
General business growth

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B+

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48

Months

7.2%

Interest

For Sale

Equipment Company
General business growth

Loan Amount
£4,918.72

B+

Risk

48

Months

7.2%

Interest

Sold
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