Adevastated Nepal, razed to a rubble by the 7.9-magnitude earthquake, will take years to rebuild and restore. While help is pouring in from all corners of the world, every person, who wants to help but does not know how to do it, can take the help of crowdfunding initiatives to do his or her bit.
One such website is Ketto, co-founded by Bollywood actor Kunal Kapoor, which has a special micro-site set up for relief in Nepal. People can either donate or create more fund-raisers there. “With several celebrities having launched their campaigns to help out Nepal, among others, the response is phenomenal, as we have managed to collect over R36 lakh in the first four days itself,” says Varun Seth, co-founder and CEO, Ketto.
“We have tied up with Care India and will send all funds collected to them to use for survival kits for the victims in Nepal. It is similar to the format we had adopted during the Kashmir floods,” says Kunal Kapoor.
Miles away, aviation technology expert Andre Milne, based in the UK, is trying to raise funds to salvage the wreckage of missing Malaysia Airlines plane MH370, which he believes lies in the Bay of Bengal. “It touches us all differently. It touches me at a level that this could be a crime against humanity, this forced disappearance of people on board the aircraft,” he says. “If you want to see whether or not this aircraft is in this site, please participate in the crowd-sourcing venture,” he adds.
Milne, who has been voluntarily investigating the case of the missing plane, is trying to raise nearly $2 million to prove his theory. He believes the missing plane may have ended up near the Maldives and hopes to crowdfund the project by raising about $10 from every donor who supports the project.
So what is crowdfunding, you ask? Well, crowdfunding is the practice of funding a project or venture by raising monetary contributions from a large number of people, typically via the Internet. One early-stage equity expert describes it as “the practice of raising funds from two or more people over the Internet towards a common Service, Project, Product, Investment, Cause, and Experience (SPPICE)”.
The crowdfunding model is fueled by three types of actors/aspects—the project initiator who proposes the idea and/or project to be funded; individuals or groups who support the idea; and a moderating organisation (the ‘platform’) that brings the parties together to launch the idea. “Crowdfunding allows people to reach out to the investor community with a proven concept,” says Anshulika Dubey, co-founder and COO of Wishberry, a crowdfunding web domain in India.
How does it help you, will be the next question. Several websites like Ketto, Wishberry, LetsVenture and PikAVenture act as agents that will hold your idea and help you connect with the masses to get that money in the bank.
First, you start a campaign by making a profile about your need, which can be for a cause or a business idea or for general awareness or even a personal ambition. The hosting website forwards and pushes your ideas and tries to get as much funds as possible to reach your desired amount in a decided time limit. And for all this, they take a certain percentage of the amount raised.
Greensole, which is India’s first patented technology to convert old sports shoes into slippers, chose the way of crowdfunding to launch its business. It started its campaign just a few days ago and has managed to make 15% of its desired amount of R3 lakh with still 34 days left. “Greensole envisions to not just market recycled footwear, but to provide these to the billions of people who cannot afford them and we are proud to share that as pioneers in refurbishing sports shoes to slippers,” says Shriyans Bhandari, owner of the social start-up, who created the profile page on Catapooolt, a crowdfunding website.
The promoter of the social enterprise thinks it’s the masses who will benefit from the idea, so why not ask the masses for help? Bhandari plans to continue with the crowdfunding way for gathering of funds even in the future when the need arises for funds.
Another dream being turned into reality through crowdfunding is that of Mean Metal Motors, who are working towards making India’s first ‘supercar’. A supercar is typically a very expensive and high-performance sports car or grand tourer. Supercars are marketed by automakers as unusual and include limited production specials from an ‘elite’ automaker—standard-looking cars modified for power and performance, as well as models that appeal to enthusiasts from smaller manufacturers.
“Porsche, Lamborghini, BMW, Mercedes and Koenigsegg are just not names, these are legacies that cannot fade away. They not only represent a sign of advancing technologies and spectacular innovation, but they also represent their country,” says the company’s page on Catapooolt, which has managed to gather R1,04,240 of the desired R5 lakh, with another 15 days to go.
“We are Mean Metal Motors, India’s one and only entry into this elite league. The Swedish did it for Christian Von Koenigsegg. It’s our turn now. We are making India’s first supercar. Be a part of the innovation. Help us make it. Be a part of the family,” appeals Sarthak Paul, founder and technical director of Mean Metal Motors, to people for support to his endeavour on the website.
Interestingly, both companies are only using crowdfunding to power their plans other than the amount they have invested themselves and plan to continue down this path in the future. “It’s cheaper, easier and much better, for it’s compassion that drives this industry, not rate of returns,” says Satish Kataria, founder and CEO of Catapooolt.
“A dream doesn’t become reality through magic; it takes sweat, determination and hard work,” American statesman and retired general Colin Powell had said. True, but it misses out an important ingredient, ‘money’.
We all dream of making it large in life, either by doing something truly adventurous, like climbing the Mount Everest or swimming across the English Channel or maybe doing something that is our own, so that we are our own bosses. And then there are times when all we want to do is help people.
So, why do we sit around and wait for it, why not just go ahead and do it? “Paisa nahi hai boss,” says Shashaank Bhansali (25), who dreams of swimming around the Indian peninsula. So, is money the anchor that binds you too? If it is, then you have a solution in crowdfunding.
Chirag Singhal on his Ketto page says, “Do you remember where you were on the night of January 21, 2015? Yes? No? Maybe? I was sleeping in a road roller on Kalewa Yaji road (Myanmar), isolated in a jungle, with no food, water, or people.”
The 21-year-old thought that R90,000 would be enough for living a year, and cycling over 14,000 km on his Scott bicycle across south-east Asia—India, Bhutan, Myanmar, Thailand, Cambodia, Laos, and Vietnam. But he soon ran out of money. “Hence the Ketto profile, through which I have managed over R90,000 so far,” he says.
Now meet Anshu Jamsenpa, the current record holder for being the only mother to climb Mount Everest twice, who is now attempting another feat—to climb the highest peak twice in seven days. “The total cost of the expedition comes down to about R36 lakh. During my first attempt, the government helped me out by footing 50% of the cost, but the second was out of own pocket. Now I am forced to turn to the people for help,” said Jamsenpa, while launching her campaign in New Delhi recently.
Says Kataria of Catapooolt, “The day we launched Anshu’s campaign, we got R10 lakh from a business house. This whole concept of crowdfunding has opened so many doors for people, not just to start their own business ventures, but also to do what they really want.”
In 2013, the crowdfunding industry grew to be over $5.1 billion worldwide. “It’s very difficult to find an estimate for such an industry, for it is the size of the population multiplied by the average amount they are willing to invest, which in the case of India is huge,” says an industry observer.
“Crowdfunding is certainly gaining popularity and is being used by people across the world. However, considering that this model seeks to raise capital from fairly small investors, including potentially inexperienced individual investors, there need to be adequate checks and balances. The regulations on this continue to evolve both globally and in India,” says Sai Venkateshwaran, partner and head, accounting advisory services, KPMG India.
“While the JOBS Act in the US had brought in the concept of crowdfunding, the related rule-making has been a long process, considering the numerous safeguards that need to be put in place. In India as well, the Securities and Exchange Board of India (Sebi) had come out with a concept paper, but has not issued any final regulations on this,” adds Venkateshwaran.
What is crowdfunding?
Crowdfunding is the practice of funding a project or venture by raising monetary contributions from a large number of people, typically via the Internet. One early-stage equity expert describes it as ‘the practice of raising funds from two or more people over the Internet towards a common Service, Project, Product, Investment, Cause, and Experience (SPPICE)’
How does it help you?
Several websites like Ketto, Wishberry, LetsVenture and PikAVenture act as agents that will hold your idea and help you connect with the masses to get that money in the bank
Satish Kataria, Founder-CEO, Catapooolt
The whole concept of crowdfunding has opened so many doors for people, not just to start their own business ventures, but also to do what they really want.
Anshulika Dubey, Co-founder & COO, Wishberry
Crowdfunding allows people to reach out to the investor community with a proven concept.
Kunal Kapoor, Bollywood actor & co-founder, Ketto
We have tied up with Care India and will send all funds collected to them to use for survival kits for the victims in Nepal. It is similar to the format we had adopted during the Kashmir floods.
Sai Venkateshwaran, Partner and head, accounting advisory services, KPMG India
considering that the crowdfunding model seeks to raise capital from fairly small investors, including potentially inexperienced individual investors, there need to be adequate checks and balances.
For Updates Check India News; follow us on Facebook and Twitter