California Business Startup Chooses Crowdfunding
On behalf of The Law Office of Lynnette Ariathurai, A Professional Corporation posted in Business Formation & Planning on Wednesday, June 18, 2014.
There are various ways for new companies to obtain startup funding for their projects. One of the most common ways has always been to obtain business startup funding from a bank or venture capitalists. However, nowadays it is becoming more common to use crowdfunding as a way to obtain the necessary capital to bring a good business idea to the market. This is the route that one technology company first decided to take in California.
The founder of the company had recently graduated from a university with a degree in electrical engineering as well as a minor in information management and technology. He came up with the idea for a new company that would release a CNC machine, which is a tool used to cut various types of materials via a computer program. The young entrepreneur came up with an idea to make a CNC machine, which did not require a customized control system.
In order to help start his idea for a new company, he teamed up with his former classmate who had recently earned his degree in history. After creating the prototype for his machine, he started a crowdfunding campaign in order to raise money to bring the product to market. The company had originally chosen a goal of $10,000; however, the new startup raised $13,000 within the first day of its crowdfunding campaign. Within one month, the new business obtained a total of $82,207 in startup funding.
Now the new business startup in California will be able to bring its product to the market in order to make a profit. However, the new company will need to have a good business plan in order to maximize its profit potential. An effective and comprehensive business plan will include a strong marketing plan as well as a compliance plan, which will ensure the company’s compliance with relevant laws.
Source: hometownstation.com, "Hart Grad Raises More Than $80k With Tech Startup Crowdfunding Campaign", Dale Fairclough, June 15, 2014