The 'High Five' Crowdfunders
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Will crowdfunding replace pre-seed start-up investments or will professional investors ‘lead’ crowdfunding campaigns, rather than or along with leading their own funds’ investments? It might very well happen, though not anytime soon. Crowdfunding nonetheless will be a very exciting and integral part to the evolving investing dynamic globally. In this journey, Entrepreneur picks up the superb five crowdfunding platforms that are scripting the India story of this global change ahead.
THE SOCIAL KING
Started in 2010 as a micro lending platform, Milaap expanded its scope of lending to crowdfunding model in September 2014 after realizing that only so many causes can be supported via micro lending route that exclude cases like medical emergencies. Today, it is the largest charitybased crowdfunding platform in India for personal and social causes even as charity or donation-based model is the largest crowdfunding model in India. “We are a utilitarian platform in the sense that people raise money for something that has a purpose and a meaningful impact,” says Anoj Viswanathan, Co-Founder, Milaap. For good, there is no time limit to raise funds and hence, the campaigner can raise funds as long as he/she wants without any penalty. Medical emergencies and community projects (civic engagements, renovation of local school etc.) are among the top reasons people choose Milaap. The platform is now focusing on two broad areas; first, it is taking a sector-driven approach towards partnerships, for instance, with hospitals where doctors would be setting up campaigns for their patients or recommending them to Milaap. Second, in order to attract more support and visibility to the campaign beyond the campaigner’s own network of friends and family, Milaap uses social media diligently. They call it ‘Amplify’ as an option for the campaigner. “If people want to take their cause to a larger audience, we would help them through social media. No crowdfunding platform has this structure globally. We will take it to other emerging markets in South Asia in one-two years,” adds Viswanathan.
THE INDIAN KICKSTARTER
Rewards-based Wishberry aspires to be India’s Kickstarter – world’s second largest crowdfunding platform (in terms of total money mobilized) as both focuses on creative projects. In 2014, it changed its flexible funding model (for campaigners to get whatever money they are able to raise in the limited time instead of raising the targeted amount) to all-ornothing. “We are on a mission to rescue creativity in India. Even though one of our competitors has a bollywood actor as its co-founder, they haven’t been able to attract any big ticket campaign. So it’s vital to have the brand focus,” says Priyanka Agarwal, Co-Founder and CEO, Wishberry. Interestingly, the platform will soon launch an incubator for budding musicians along with composer and singer Shankar Mahadevan’s (who is one of the investors in Wisberry) Bengalurubased Shankar Mahadevan Academy. “Mahadevan will curate these music artists and we will help them raise money. The total amount raised will be matched by the academy and few grant giving organizations that we work with,” adds Agarwal who has already planned further extension of the incubator. In Q1 2017, the incubator will launch ‘Taare Zameen Par’ segment to work with under privileged or differently-abled young musicians.
THE BIG GUY
When 18-year old Shweta Katti, daughter of a sex worker based in Kamathipura – Mumbai’s red light district was able to make it to the US for studies in 2013, it was the happiest moment for team Ketto that claims to be the biggest rewards-cum-charity based crowdfunding platform in India. It’s because Ketto helped her raise money through a Mumbai-based nonprofit called Kranti. Moreover, in 2014 Katti even won United Nations’ Youth Courage Award. On the top of the crowdfunding chain in India, Ketto is unfazed by numerous existing similar platforms. “Competition is, infact required to create more awareness about crowdfunding. It is too early for only one player to exist in the market. The more the players, the better it is in order to reach out and educate more people, which would eventually add more value to it,” says Varun Sheth, Founder and CEO, Ketto. The platform recently launched its improved version called Ketto 3.0 with new design, user experience and features including social media sharing and ‘Ask for an Update’ where the backer of a particular campaign can request for an update from the campaigner about the fund’s allocation and its progress. Ketto will also soon enable recurring donations, first of its kind platform, for non-profits to raise money every month from current donors.
WHEN THREE’S A CROWD
Launched in 2013 by Satish Kataria (former venture capitalist), sector agnostic Catapooolt (extra O to signify that three’s a crowd) has grown quite rapidly to have more than 2,000 contributors and raised more than Rs 1 crore. Kataria claims to be among the people introducing crowdfunding concept in India. In 2010, he launched a crowdfunding model through his earlier venture Springboard Ventures. The platform raised Rs 1.2 crore in its seed round from Kolkata Angels, Venture Nursery, and others. The contributors or backers on Catapooolt receive quarterly updates on the utilization of funds by the campaigners. Early this year, it launched ‘Catapoolt Changemakers Challenge’ for start-ups in Internet of things, consumer products, health and lifesciences, transportation and energy. The top 15 startups out of 250 submissions were selected for pitching to angel investors on grand finale.
THE NEW KID
Government apathy towards less famous sports, outside the purview of cricket, in India isn’t a secret. So when it comes to something like ice hockey, times got even tougher for the India team in April 2015 when it lacked enough funds to participate in the Championship Cup of Asia in Kuwait. So, the team launched a crowdfunding campaign to raise Rs 3.5 lakh on Delhi-based BitGiving platform, and within a week it raised Rs 5.69 lakh. “It marked the way for other sportsmen to know about other ways to raise funds,” says Ishita Anand, Founder and CEO, BitGiving. Anand believes that reward-cum-charity based BitGiving was started to bridge the huge deficit that existed in 2013 in the ways, for social organizations, creative artists etc., to raise funds. It began with social space since the learning curve was much faster, and later went sector agnostic. The platform guide the campaigners to engage with people through various channels like Google, WhatsApp etc., and which one works best for them. “We automated the process to tell them that particular percent of backers comes through their Facebook chats etc.,” adds Anand. This makes campaigners less dependent on BitGiving to amplifying their campaign’s .
This article first appeared in the Indian edition of Entrepreneur magazine (August 2016 Issue).