The Benefits Of Using Accredited Crowdfunders As An Investment

Posted on: 2 June 2016

Investors have often turned to crowdfunding in order to diversify their investment portfolios. Many financial advisers suggest that investors who want to add to their passive income sources partake in accredited crowdfunding platforms. Accredited crowdfunding is designed to protect both crowdfunders and investors from any problems while also fostering best practices for crowdfunding platforms. Accreditation is granted based on an interview and review process of individual platforms; they must meet the qualification criteria during a rigorous application process. Many variables of a crowdfunding platform are evaluated to become accredited, such as operational transparency, security of information and payments, platform functionality, and operational procedures. The following are benefits of investing in projects through accredited crowdfunding platforms over non-accredited:

Can Support Larger Capital Raises

While the initial thought of crowdfunding typically springs thoughts of small projects and dollar amounts, accredited crowdfunding allows for much larger amounts of capital to be invested. These platforms support investors who have a substantial amount of money to put forward on companies of their choosing. Investors involved with these platforms have the financial wherewithal to know how to support a project through its entire life, even when an additional investment is needed in order to see the project through completion. This often results in lucrative returns for the investor.

Investors Have Access To Vetted Campaigns

When making investments—through accredited crowdfunding—in passive income sources, investors need to be able to fully understand the company that is being considered. Crowdfunding platforms provide investors with a completely thorough and comprehensive pitch from the company. In order to convince investors to invest in their product or idea, the operators of crowdfunded campaigns will need to provide investors with complete transparency about their project, which can be found from their online profile of videos, text, and other information about their venture.

Opportunity to Invest in Business-to-Business Ventures

Another great benefit of accredited crowdfunding is the fact that investors can easily invest in business-to-business opportunities. People tend to invest in companies that they understand or fields they have experience in. This often is a great platform for business-to-business ventures because the pool of investors is often quite small, which means investors have a higher stake in the investment. Accredited crowdfunding also means that only a few companies will have access to investors and their investment funds.

Projects through accredited crowdfunding platforms are ideal sources of investment opportunities that have the potential to yield high returns. These platforms provide transparent guidelines that ensure the investor is fully secure and provides a community that can enjoy the benefits of crowdfunding. For those who have further questions about this type of investment, consider consulting with a financial planner that specializes in online investment opportunities. For more info, look up personal crowdfunding sites.