Definition: Crowdfunding is a collective effort by large numbers of people who all donate or contribute a small amount of capital in support of some good cause, activity, effort, project or venture initiated by other people or by an organization.
But lately C is also being used to fund a startup company, in which case it is a form of private equity, like venture capital and angel investors.
The funds that are being supplied are usually donations, but can also be investments, in which case the opportunity must be filed with a securities regulatory authority.
In return, participants in such C may receive interest payments (debt-based crowdfunding) or company stock (equity-based crowdfunding).
More on corporate finance: Angel Investor, Business Divestiture, Corporate Finance, Debt Restructuring, Private Equity, more...
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