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Kickfurther is a crowdfunding website that helps businesses get the funding they need. Instead of simply asking others for donations to help fund their ideas like other crowdfunding organizations, they work a little bit differently by allowing users to invest their cash in products they believe in with a chance to get a return on their investment.
What Is Kickfurther?
Sometimes when a company is formed, they underestimate how much cash flow is needed in order to continue production. In order to find a solution, crowdfunding sites were formed in order to meet necessary funds to continue production. People who are willing to give their money usually receive a small prize for donating cash along with the satisfaction of promoting a product they believe in.
Kickfurther only lists companies on their website that already have a proven track record. When you back a company or offer, the funds are sent to the company only when their funding goal is reached. Otherwise you’ll get your money back. From there, you can help promote and market the goods, and when their product is sold you get a portion of the cash and earn a promised return.
The average annual return for backers is 22%. Compared with CD rates hovering around the 1% mark at the current moment, this is a lot higher return. However, there are a few things that we want you to be aware of before making a decision.
What Are The Risks Involved?
Giving money to a company on Kickfurther does not come without risk, nor does any investment vehicle. Yet the one thing that Kickfurther does is only select companies that have already started selling and have created some cash flow. When you invest in a company on Kickfurther, you actually own the goods that are being sold. In sense you’re becoming a part-owner of the company.
What Happens If The Business Fails?
If a business fails and wants to terminate an agreement with you, there is a possibility that they will lower prices in order to get every product off of their shelf. After 30 days, if the products still do not sell, a majority vote by all backers can cause the company to liquidate all of their assets in order to pay back the backers.
In this scenario, you most likely won’t be getting all of your money back, but at the same time you’ll at least be able to salvage a portion of it. These votes are democratic in the sense that each backer’s vote will be proportional to the amount of duns they put in.
Are There Any Guarantees?
As mentioned above, Kickfurther will only pick companies that have already created a cash flow and have some social credibility. While there aren’t any guarantees, you have a decent chance of earning a great return on your investment.
How Much Can I Make? – Case Study
This completely depends on the agreement that you make with the company. You need a minimum of $20 to invest, but you automatically get a $5 sign-up bonus when you use a referral link. In order to see how well this site works, I reached out to people who have experience using Kickfurther. One person decided to give it a shot and invest $43.50 in 2 different companies.
The first company didn’t do as well as expected, yet they were able to pay back the investor all of the money that he put in. The only thing that they lost in this case was a little bit of time and the potential that his money could’ve made had he put it somewhere else.
The second company is doing quite well and has already agreed to pay back the investor in 27 days with the agreed interest rate of 14% over a 3-month period. Earning that high of a return in such a short amount of time is almost unheard of.
In both cases, the investor looked for businesses that he thoroughly believed in after doing a little bit of research, and also believed that they held a strong future. Kickfurther claims that the average investor makes 22% over the course of a year, and in this particular case the investor has exceeded these goals. Yet still be wary that there is always a risk, as with any investment.
How Do I Get Started With Kickfurther?
There are quite a few things you need to go through when you sign-up with Kickfurther, but we’re going to walk you through the process in 7 steps to make it seem simple.
1. Register. You can sign-up with Kickfurther by using our referral link here. You’ll get a $5 bonus using this link in your Kickfurther account, and so will we (Thank You!). If you do want to use a referral link, click here. Click on the “Sign Up” button at the top of the page and use your email or Facebook account to register.
2. Select an offer. As soon as you register you’ll be brought to a page with new offers to invest in. Carefully read each description to see if it’s a product that you believe in. Make sure to view what kind of interest they are offering to see if it’s worth your time and money. New offers are always posted at 2PM EST.
3. Fund a company. Once you see a company that you believe will do well, find the “Contribute” button and add your investment amount. A minimum is $20 is required, and there’s no fee for adding funds. However, when you decide to withdraw, there is a 1.5% fee.
4. Wait. At this point, you’ll have to wait to see how well the company does. You’ll get your promised interest when the company reaches its said goals. For example, in the image below, this company promises to pay all funders when 66% of their product is sold.
5. Refer friends. Each time you refer a friend, you get $5 and so do they. A great way to spread the word is through Facebook and Twitter. You earn even more when you refer a business, receiving $100 in cash or 25% forward revenue for 1 year. Thank you to everyone who has used our referral link!
If you find a great business to invest in, this is a great way to get started. I’ve already put in $20 toward my first company, and I’ll let everyone know how it goes. Just make sure to do some research beforehand. If you end up investing a little bit of money with Kickfurther, let us know how your experience goes in the comments below. Thanks for reading and happy frugaling!