Get All Access for $5/mo

Crowdfunding Nearly Tripled Last Year, Becoming a $16 Billion Industry The pace of crowdfunding growth has only been accelerating, according to a new report on the global industry.

By Catherine Clifford

Opinions expressed by Entrepreneur contributors are their own.

If crowdfunding's been hot for awhile, last year, it was damn near on fire.

In 2014, companies and individuals across the globe raised $16.2 billion through crowdfunding, according to a report released today by industry research firm Massolution. That's a 167-percent increase from 2013, when $6.1 billion was raised.

On the heels of a record year, crowdfunding is projected to lap itself again. This year, the industry is expected to generate $34.4 billion, according to the report.

Related: Food-Tech Startup Dinner Lab Is Crowdfunding a Cool $2 Million -- From Its Customers

Looking at all of crowdfunding is like trying to figure out how to hug an octopus -- there are currently 1,250 active crowdfunding platforms, none of which is even close to holding a monopoly. Kickstarter, arguably the household "Kleenex brand" of crowdfunding platforms, has recently been usurped by personal campaign platform GoFundMe, according to the report. San Diego-based GoFundMe raised $470 million from 6 million donors in 2014, while Brooklyn, N.Y.-based Kickstarter raised $444 million last year from 3.3 million donors.

Even while crowdfunding is an entrepreneur's hustle, it's attracting the attention of big corporate giants lately -- but for reasons that go beyond the money-raising aspect.

Related: Déjà Vu 2012: A Zombie-Frankenstein JOBS Act 2.0 Is in the Works

"Large enterprises are now pursuing a crowdfunding agenda to market-test innovation portfolios and validate R&D outputs," Carl Espoti, the CEO and founder of Massolution and Crowdsourcing.org, writes in the report. "Our observations point to major global companies seeing models as a digital incubators to encourage new ideas, intellectual ideas and human capital, as well as to form meaningful customer relationships."

While crowdfunding is used for everything from investing in real estate to supporting musicians, the largest portion of the funds generated last year was used for launching businesses. Check out this chart, which shows the sectors that received the most funding via crowdfunding both last year and two years ago:

Click to Enlarge+
crowdfunding graphic

Related: For This Cat Cafe, Crowdfunding With Kickstarter 'Was Never About the Money'

Catherine Clifford

Senior Entrepreneurship Writer at CNBC

Catherine Clifford is senior entrepreneurship writer at CNBC. She was formerly a senior writer at Entrepreneur.com, the small business reporter at CNNMoney and an assistant in the New York bureau for CNN. Clifford attended Columbia University where she earned a bachelor's degree. She lives in Brooklyn, N.Y. You can follow her on Twitter at @CatClifford.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Leadership

How to Close the Trust Gap Between You and Your Team — 5 Strategies for Leaders

Trust is tanking in your workplace. Here's how to fix it and become the boss your team needs to succeed.

Health & Wellness

Get a Year of Unlimited Yoga Class Downloads for Only $23 Through June 17

Regular exercise has been proven to increase energy and focus, both of which are valuable to entrepreneurs and well-known benefits of yoga.

Growing a Business

He Immigrated to the U.S. and Got a Job at McDonald's — Then His Aversion to Being 'Too Comfortable' Led to a Fast-Growing Company That's Hard to Miss

Voyo Popovic launched his moving and storage company in 2018 — and he's been innovating in the industry ever since.

Business News

'Passing By Wide Margins': Elon Musk Celebrates His 'Guaranteed Win' of the Highest Pay Package in U.S. Corporate History

Musk's Tesla pay package is almost 140 times higher than the annual pay of other high-performing CEOs.

Starting a Business

I Left the Corporate World to Start a Chicken Coop Business — Here Are 3 Valuable Lessons I Learned Along the Way

Board meetings were traded for barnyards as a thriving new venture hatched.

Business Culture

Why Remote Work Policies Are Good For the Environment

Remote work policies are crucial for ESG guidelines. Embracing remote work can positively impact your business and employees.