Understanding the “Crowd”

This chapter describes the concept of crowdfunding and its various aspects. Access to start‐up and growth capital has remained a central challenge for entrepreneurs for a very long time. It is pointed out that crowdfunding democratizes access to capital. While crowdfunding gives access to a nationwide network of potential investors, the expectations of the crowd will be quite high. Entrepreneurs must be adequately prepared to showcase their potential and competency in an increasingly competitive environment. Entrepreneurs need to take stock of their social capital—that is, the sum and value of all the relationships that exist around the business owner and their company. These are relationships that produce economic benefits. It is highlighted that crowdfunding directly connects creators and entrepreneurs to consumers, the market, willing investors, or buyers; no expensive market‐testing middlemen, gatekeepers, or naysayers.