Disadvantages of crowdfunding

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Disadvantages of crowdfunding
Disadvantages of crowdfunding

In the previous article we mentioned major advantages of crowdfunding but this method is not all glory and shining and it has its own perks and disadvantages of crowdfunding as well. So here in this article we will take a look at the dark side of crowdfunding so stay with us to learn more.

It won’t bring investors

There is a huge difference between an investor and people who lend you fund in crowdfunding. Investors are organized businessmen with plans but crowdfunding will bring you normal people with hope to grow. Investors are always there and will even help you make things works but in crowdfunding, you won’t have such these merits. This is one of the major Disadvantages of crowdfunding.

Scammers are always there

People may talk trash about you and that can break trust between you and your people. These scammers are like weed and they grow fast and guess what, in crowdfunding, they exist more than ever.

False positive view

You may be able to get funding you need using crowdfunding but there is a huge risk involved.  You cannot assess if your product has flaws using crowdfunding because people who lend their money won’t think of loss. This may lead to false positive view and ignorance toward problems that may lead to your downfall. So be aware of this because it is one of the most important Disadvantages of crowdfunding.

It can be expensive

If you can manage your crowdfunding campaign right then you may even lose money instead of gaining it. Campaigns are not cheap and this can bring you more trouble if you can get funding you need from the crowd.

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Preparation is hard and heavy

As we have mentioned in the previous point, crowdfunding can be expensive so in order to avoid financial loss then you have to put a huge amount of time and energy in order to get crowdfunding right.

Feedback may cause issues

Feedback may cause issues
Feedback may cause issues

Feedbacks are amazing but there are people who just give feedback with zero knowledge. When you go for crowdfunding then this type of feedbacks are frequent and believe us when we say it can be discouraging. Disadvantages of crowdfunding can be direct but this one will hit you indirectly and hurts your mental power.

Scaling and visibility

Scaling and transparency is not something you want to have with everyone. This can be a big problem because using crowdfunding you have to do this and this is a big disadvantage.

Crowdfunding market maybe saturated

Many people may have already used crowdfunding for similar projects and that’s why this market can be saturated before you even touch it.

It brings some unnecessary compression.

When you start crowdfunding then you may bring yourself in the front page. It means that people will compare you to your rivals more than it should be and that can cause unnecessary issues and headaches for you. This point among disadvantages of crowdfunding will increase pressure without any positive side of it.

Summery disadvantages of crowdfunding

  • It won’t bring investors
  • Scammers are always there
  • False positive view
  • Preparation is hard and heavy
  • Feedback may cause issues
  • Scaling and visibility
  • Crowdfunding market maybe saturated
  • It brings some unnecessary compression

ٌWhat is your opinion about disadvantages of crowdfunding? Comment now

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1 COMMENT

  1. Nice presentation of the points by the author about advantages & disadvantages.

    To add more value to this article I also had written one article related to the advantages & disadvantages of crowdfunding which will add more knowledge to the readers of this blog

    Interested can read here – https://goo.gl/oKFMvN

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