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- Date Established
- Powell, Ohio
- Both rewards & equity crowdfunding available
- Low fees for successful campaigns
- Good customer support
- Pre-screening of campaigns benefits backers
- Flat monthly fee hurts unsuccessful campaigners
- You get no funds if you don’t reach your funding goal
- Campaigns must be pre-screened for approval
Crowdfunding websites have taken off in the past decade, with most of the larger crowdfunding outfits focusing on inventors, self-publishers, and charitable causes. Fundable, by contrast, is all business.
Founded by Wil Schroter and Eric Corl and launched in 2012, Fundable touts itself as a business crowdfunding platform that offers hands-on support to companies as they navigate the fundraising process. Fundable offers businesses the choice of launching either a rewards-based crowdfunding campaign (a la Kickstarter) or an equity-based campaign in which backers get a share of stock in the company in exchange for their backing. Fundable assists in the marketing of these campaigns as well, helping companies set up their fundraising profiles and share them with personal and professional networks.
Any company that creates a profile is reviewed by Fundable for their suitability before being allowed to raise money on the platform. Fundable is less geared toward starry-eyed dreamers with wild ideas than towards start-ups and companies with a solid plan of action. What’s more, only accredited investors can contribute to an equity crowdfunding campaign on Fundable. It’s more of an upmarket crowdfunder than most of its immediate competitors. Read on to get a full picture of Fundable’s crowdfunding platform.
Table of Contents
Fundable facilitates rewards-based and equity-based crowdfunding (though not both simultaneously) to a wide variety of businesses. The following categories of businesses are eligible to apply to use Fundable:
- Consumer Products
- Food Service
- Health & Beauty
- Life Science
- Personal Care
- Real Estate
- Specialty Retail
- Sporting Goods
In order to use Fundable’s platform, you have to be at least 18 years old and your business must not be involved in the following:
- Adult-Oriented Material
- Charitable Projects
- Collections Businesses
- Coupons or Discounts
- Cash-Equivalent Instruments
- Credit Services
- Donations or Charitable Solicitations
- Money Service Businesses
- Gambling Businesses
- Healthcare Discount Programs
- Illegal, Inappropriate, or Offensive Items/Activities
- Marketing Businesses
- Miracle Cure Products
- Get Rich Quick Schemes
- Phone Services
- Regulated Activities (bail bonds, security brokers, etc)
- Tobacco Products
- Travel and Time Shares
Beyond that, you can’t use Fundable to do anything unlawful or unethical, post spam, or harass anyone.
Terms and Fees
Here are the terms and fees for Fundable’s crowdfunding campaigns:
|Funding duration:||No set limit|
|Fundable fee:||$179 per month|
|Funding terms:||All Or Nothing (must meet your goal to collect funds)|
|Payment processing fee:||3.5% + 30¢ per transaction (Rewards campaigns only)|
Fundable uses the “all or nothing” model of crowdfunding — if you don’t reach your funding goal during your funding period, you get nothing.
Notice that instead of charging a percentage of the money your raise as a fee, Fundable charges a flat monthly fee of $179. Most other crowdfunders will take a chunk (usually 5%) of the money raised in a successful campaign. This means that with Fundable, you’ll have to pay for the privilege of using the platform whether or not you are successful in your campaign. This makes Fundable a less attractive option for small-time businesses and entrepreneurs who are uncertain of the likelihood of succeeding in their campaigns, as well as projects with a modest fundraising goal. On the other hand, it’s great for projects that raise a significant amount of capital and which meet their goals, as they won’t have to pay thousands of dollars in fees.
If you want the highest degree of help possible, via the premium package, Fundable will work to connect you with accredited investors. Pricing for the premium package is not given on the website, but I did some digging, and it seems this package is available for a one-time payment of $2499.
You’ll also notice that payment processing fees only apply to contributions to a rewards campaign. That’s because, with an equity campaign, all payments are made offline directly from the accredited investor to the campaigner after the fundraising goal is met, via wire transfer or check.
One requirement of running a rewards campaign is that you offer at least three levels of rewards to your backers. However, those rewards can come in the form of either a pre-order of a product or a promise to provide a service. Fundable gives you more flexibility in terms of the rewards you can offer than does Kickstarter, which requires that your rewards come in the form of physical goods.
When you apply to use Fundable, you create a Company Profile in which you list details concerning your company, your project, and your fundraising goals. You’ll then have to wait for Fundable to approve your profile before you can continue. (If you don’t like the idea of waiting for approval, Indiegogo automatically approves all projects submitted and does due diligence later)
After that’s done, you choose either a rewards campaign or an equity campaign. A rewards campaign pledge can be for as little as $1, while the minimum commitment for an equity campaign is $1000. There is no maximum pledge amount.
Sales and Advertising Transparency
Fundable lays out the terms and conditions of its use in a very straightforward, plain-spoken manner. There’s even a hint of dry humor in there. Nothing about Fundable gives off any sales-y vibes.
Customer Service and Technical Support
Fundable provides a FAQ to answer questions about the platform, along with lengthy guides to investing, running a startup, and crowdfunding. There are also a number of infographic materials and startup stories provided, all freely available online. For direct support, a toll-free phone number, an email address, and live chat services are available on Fundable’s website. This goes above and beyond the level of support typically offered by crowdfunders, many of which just provide an email contact form for support. Fundable gets some brownie points for this.
Negative Reviews and Complaints
Professional reviewers haven’t found much to fault with Fundable, other than the fact that there is no “flexible” funding option that would let you keep whatever you raise, and that the $179 monthly fee might be a bit onerous for a small business operating on a tight budget. Among actual users of the service, some have complained of a lack of support from Fundable in helping to locate investors, as well as inadequate customer service.
Positive Reviews and Testimonials
Professional reviewers have mostly sounded positive notes about Fundable. Some have praised the flexibility of allowing both rewards-based and equity-based crowdfunding campaigns. One reviewer noted: “A successful Rewards raise can be a great foundation of support for a subsequent Equity raise.” Others have opined that Fundable is a particularly good platform for backers, as Fundable does a good job weeding out unserious campaigns.
I’ve seen some positive user feedback as well — many people report having great customer service experiences and a high level of support in finding investors.
Fundable isn’t exactly a crowdfunder for the masses. Its monthly fees and restrictive policies regarding who can use the platform suggest that the little guy may have to look elsewhere for a more forgiving means of crowdfunding. However, for the serious business looking to raise a significant amount of capital, Fundable is an excellent option, especially considering you get the choice of running a rewards campaign or an equity campaign and the fact that Fundable won’t take a cut of the money you raise. All else being equal, if you could raise a million dollars, better to pay Fundable’s monthly fees than to pay the 5% fee that most other crowdfunders charge! (It’s true — I did the math.)
Fundable isn’t a platform for charitable causes, fly-by-night inventors, or conspiracy theorist bloggers, but for a business with a solid plan of action, it might be just the ticket.