The Small Business Administration, SBA, Learning Center has numerous courses geared toward individuals interested in starting and improving the efficiency of their small business. Topics include financing, government contracting, managing a business, marketing in addition to starting a small business. Our previous blog mentions four ways of financing your business; loans, grants, venture capital as well as friends and family. Crowdfunding, unlike angel investments or asking your family members, is when an entrepreneur attracts a large group of investors, each of who takes a small stake in the business idea, by contributing to an online funding target.
How to Find More Information on Crowdfunding
The SBA’s Learning Center of has a 30-minute introductory program designed to show you what crowdfunding is and how it can help your business succeed. The Dallas Public Library also has resources available for check out to improve your ability to raise capital through the digital community such as:
A Crowdfunder’s Strategy Guide: build a better business by building community
Crowdfunding: a guide to raising capital on the internet
Revolutionizing Innovation: users, communities and open innovation
Remember to understand your potential investor’s perspective. Investing in early stage businesses can be risky, and if you are sharing your crowdfunding with friends and family be sure that they understand both the benefits and risks of investing in such opportunities. Both you, as an entrepreneur, and those who want to invest in your startup should be aware of how to search through crowdfunding regulations.
Tax Implications of Crowdfunding
It is also important to note the potential tax implications from crowdfunding. The Internal Revenue Service, IRS, includes small business tips for taxes, large cash amounts, deductions, established payments and records for activities including crowdfunding. Other helpful resources for small businesses in the Sharing Economy Tax Center has extensive details for self-employment taxes, recordkeeping, rules and forms.