What Is Crowdfunding?

By Catherine Brock – Updated Feb 26, 2025 at 2:44 PM EST

Key Points

Crowdfunding platforms like Kickstarter allow project funding via public pledges.
Projects must meet set goals to receive funds; fees apply, such as Indiegogo's 5%.
Glowforge raised $27.9M through crowdfunding, surpassing its $100K target.

Crowdfunding is the practice of raising a large amount of capital via small pledges from many backers. This method of fundraising is used by individuals in need, content creators, and businesses.

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Green paper cut-outs of people holding hands around a pile of money. — Image source: Getty Images.

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After 30 days, Glowforge had raised $27.9 million. The capital raise broke the previous 30-day crowdfunding record of $20 million set by smartwatch company Pebble Technology, which was acquired by Fitbit in 2016.

Glowforge continued to raise venture capital after its crowdfunding success. Today, the company sells three printer models -- the Aura, Plus, and Pro -- with prices ranging from $1,199 to $6,995.

Unfortunately, the crowdfunding success of OculusVR, Glowforge, and Pebble Time is atypical. According to career website Zippia, crowdfunding campaigns typically raise about $5,200.

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About the Author

Catherine grew up in Southern California wearing a lot of black and trying to perfect the art of sarcasm. Prior to joining The Fool as a contract writer, Catherine was climbing the corporate ladder in marketing roles and dabbling in too many side hustles. When she's not writing, she can be found riding a horse in the country or shopping online for clothes.

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@catherinejbrock

Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Catherine Brock has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy.