MANILA – Thanks to crowdfunding, entrepreneurs who want to start projects but don’t have enough financial resources can now turn their ideas into reality.
Patrick Dulay, founder of The Spark Project website, said that crowdfunding is a scheme that lets entrepreneurs present their plans and convince online backers to fund their projects.
“Crowdfunding is a new term. Although the concept of crowdfunding isn’t new at all. We chip in for like a gift. But the difference of crowdfunding is the technology such as the social media and e-commerce. People now can support or chip-in via credit cards online.”
Founded in 2013, The Spark Project is a website that helps budding entrepreneurs easily tap into their online crowd which could offer financial support to their plans.
“If someone has this creative, innovative, passion-driven project, and usually, the problem is they can’t seem to make it happen because of the financial resources. With a platform like ours, it makes it easier for them to tap into that crowd,” Dulay said.
He also said that he drew inspiration from website kickstarter.com, the most popular crowdfunding website in the United States.
Dulay revealed that the greatest amount of funds that was raised for a single project was over P300,000.
On the other hand, since its inception, The Spark Project was able to raise over P1.3 million for various projects.
Dulay said that crowdfunding is not only a platform to collect money as it can also be used as a very effective marketing tool for a certain brand.
“You can look at it as a marketing tool to raise awareness for your projects, for your company, for your brand. It’s about engaging with your backers and engaging that community.”
Interested entrepreneurs may log on to www.thesparkproject.com to know the guidelines and start crowdfunding for their projects.
Meanwhile, Dulay explained that crowdfunding has three classifications, but only one is being used in the Philippines.
The first and most popular type is the rewards-based crowdfunding where backers donate to receive a reward offered by the project.
“[The rewards] would differ from one project to another and that’s where the fun part of crowdfunding goes because it challenges a project to be creative."
"Rewards are usually outputs of the project. It may be a small token as a sign of gratitude towards the support that one gives to a project. It can also be like limited edition products or unique experiences.”
Second is the equity-based crowdfunding where backers offer money to receive a share of the company or enterprise. This type of crowdunfing, however, is only availablein the US as Philippine laws still do not allow it.
Last is the loan-based crowdfunding where backers lend money for a short period of time to micro-lending sites.