Crowdfunding refers to the investment of a large number of people in a company. People can support companies or carry out projects with relatively small amounts of money.
Crowdinvesting consists of many people investing small amounts in projects or companies. In these cases, the realization of the projects cannot be financed solely by the company itself. The goal is to make a profit from the invested money.
How crowdinvesting works
Crowdinvesting works similarly to crowdfunding through online platforms. People and interested parties can invest a minimum contribution in the projects they choose. The minimum amount is set by the company itself. Investors act out of economic interest to make profits.
Difference: Crowdfunding and Crowdinvesting
Crowdfunding is often used to support and develop products or services. Crowdinvesting, on the other hand, is advantageous if you want to support a company. Crowdinvesting is not a donation, but an investment. In return for the investment, sponsors receive shares in the company.
