There are two different funding methods for Crowdfunder projects:
All or Nothing – You only receive your pledges if you hit your target. This is best suited for projects that need to reach a set target to be able to carry out their aims. The average pledge size on 'all or nothing' projects is £50.
Flexible Funding – Keep all your pledges, whether your projects hits target or not. This is best suited for causes or charitable projects. The average pledge size on 'keep what you raise' projects is £10.'All or nothing' projects generally raise more money, but you do have to hit your target. 'Flexible Funding' means you’ll keep all the money pledged by your supporters but you’ll also have to fulfil all the rewards no matter how much or little is pledged.
All or Nothing – If you don't hit your project target, no money will be taken from your backers. Your backers will receive an email informing them that the project has not reached its target and that they will not be charged. You'll not be charged any fees if an 'all or nothing' project does not reach it's target.
Keep what you raise – You will receive any funds pledged on your project regardless of whether you reach your target or not. Your backers will receive an email informing them that the project has closed and that they will now be charged. You'll be charged the Crowdfunder fee of 5% VAT on all pledges received.
The longest a project can run for is 8 weeks (56 days). However, we believe that the the optimal duration of a crowdfunding project is 4 weeks (28 days). There is always a spike of activity at the beginning and end of a project, so keeping a project relatively short allows you to keep the momentum going.
Pledge payments will be made once your project has closed successfully. With ‘all or nothing’ funding, a project is only successful if it hits it’s target. With ‘keep what you raise’, all projects that raise any funds are considered successful.
PayPal – Pledges will be deposited into your PayPal account in individual payments and usually arrive within 24 hours. Once your project has closed you will need to log into your PayPal account to track the payments, and transfer them to your bank account. Please make sure your PayPal account is verified and set to receive GBP.
Stripe – Pledges will be deposited into your Stripe account in individual payments and usually arrive within 24 hours. Pledges will be deposited straight into your linked bank account within 7 working days. Once your project has closed you will be able to log into your Stripe account to check the status of the payments.
GoCardless (Community Shares only) – GoCardless will collect you pledges and deposit the payments straight into your linked bank account within 10 working days. Once your project has closed you will be able to log into your GoCardless account to check on the status of the payments.
Crowdfunder – 5% VAT (VAT is 20% on the fees, so the overall fee is 6%) - charged on each pledge once your project closes successfully. The fees will already have been taken by the time the funds arrive in your payment provider accounts (PayPal, Stripe, GoCardless).
PayPal – 3.4% 20p fee on each pledge - charged when pledge payments arrive in your PayPal account. Fees on overseas payments may vary.
Stripe – Stripe charges 1.4% 20p per pledge for any European cards and 2.9% 20p per pledge for any non-European cards - charged when pledge payments arrive in your Stripe account.
GoCardless – (Community Shares projects only) - 0.5% on each pledge - charged when pledge payments arrive in your GoCardless account.
Still need to know a little more? Crowdfunding has it's challenges but don't worry, we're here every step of the way. Get in touch with one of our experts.