Crowdfunding is an increasingly popular method for startups or small businesses to secure capital for launching a new business or new product, funding a special project, or financing business growth initiatives. However, since there is also a growing number of crowdfunding platforms, it may be challenging to select which one would be the best fit for your small business.

There are definite and significant differences in the type of funding each platform offers. To help you in your decision making process on where to seek funds, here’s a rundown of the most commonly used crowdfunding sites.

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Kickstarter

When you think of crowdfunding websites, Kickstarter is likely the first to come to mind. Founded in 2009, the platform is unique in that it rewards people for donating. Those who support a project (often called funders or backers) receive perks—from a product to a unique experience—depending on their level of investment.

Who it’s Good For: The vast majority of projects on Kickstarter are creative in nature. It’s also worth noting that, given Kickstarter’s unique approach, you need to have a specific project for people to donate to that leads to a final deliverable. That means this isn’t the site to turn to if you have a less tangible goal, such as getting a service business off the ground.

What it Costs: Here’s another important caveat with Kickstarter: If you don’t raise 100% of your funding goal, you get none of the cash and donations are returned to donors. If you meet your goal? Kickstarter has a 5% fee, and the payment processor will charge an additional fee. Payment processing fees are 3% plus 20¢ for each pledge over $10, or 5% plus 5¢ for each pledge under $10. If your funding initiative isn’t successful, you won’t pay any Kickstarter fees.

GoFundMe

GoFundMe is another big name among the best crowdfunding sites. While plenty of businesses use the platform, it tends to skew mostly toward individual people aiming to raise funds for something in particular. This could be anything from covering medical bills to paying for education or supporting a cause.

Who it’s Good For: GoFundMe touts the fact that it’s for “personal causes.” which means there are a lot of individuals on the platform. That makes it ideal for entrepreneurs looking for money to open a new venture, support their company through a downturn, or even take their existing business to the next level.

What it Costs: GoFundMe is another platform where you must meet your fundraising goal in order to collect. How much does GoFundMe take? For campaigns started in Canadian. dollars, there is no platform fee. You’ll also pay 2.9% per transaction, plus an additional 30¢ per donation. That includes any debit or credit card charges.

Indeigogo

Indiegogo isn’t quite as niche as the other platforms, meaning you’ll find a solid mix of causes, businesses, and individuals on the site. Additionally, Indiegogo stands out from other crowdfunding sites, as it offers two different types of crowdfunding: flexible funding or fixed funding. Flexible funding doesn’t require you to meet your fundraising goal to collect. However, you will pay a higher fee if you don’t reach your target. You can also opt for fixed funding, where you’ll only get the money if you hit your fundraising goal.

Who it’s Good For: Just about every industry is covered on the platform, making it a good fit for almost anybody.

What it Costs: Indiegogo’s fees are broken into three different categories:

• Platform fee: 5% of all funds raised for your crowdfunding campaign. These are calculated and deducted from the funds you actually raise, rather than your funding goal.
• Transaction fee: Varies based on country but is usually around 2.9% plus 30¢ of every transaction.
• Transfer fee: These might occur when Indiegogo transfers money to your bank account. The price depends on your country—for example, it’s $25 in Canada if you have a Canadian bank account.

Patreon

Another crowdfunding platform with an emphasis on creative projects, Patreon works with a subscription or membership model. This means that donors provide regular contributions, rather than making a donation in one lump sum. With a tagline of “Change the way art is valued,” the platform is designed to support creatives in pursuing their passions and making things others enjoy.

Who it’s Good For: Because Patreon prides itself on supporting creators (from podcasters to game creators to artists), this platform is best if you’re pursuing a creative venture.

What it Costs: The price that fundraisers or business owners pay for Patreon depends on the plan they choose. The “Lite” plan will cost 5% of the monthly income you earn on Patreon, the “Pro” plan runs at 8% of your monthly income, and the “Premium” plan will take 12%. You’ll also pay for payment processing, with a standard rate of 2.9% plus 30¢ for each successful payment over $3 or a micropayment rate of 5% plus 10¢ for each successful payment of $3 or less.

GoGetFunding

GoGetFunding may be a site you’ve heard less about despite the fact that it’s been around since 2011. But it’s another great option, particularly for those who are looking for some flexibility in terms of the projects they can fundraise for. Additionally, GoGetFunding allows fundraisers to keep the money raised whether they meet their target or not.

Who it’s good for: GoGetFunding empowers users to raise funds for any cause—whether it’s business related, personal, or for a nonprofit.

What it costs: GoGetFunding charges a fee of 6.9%, which sounds high when compared with the others. However, it’s worth noting that this fee includes both the 4% platform fee and the 2.9% payment processing fee. This makes it a bit more cost-effective than most of the other options out there. Much like the other crowdfunding platforms, you’ll also pay a 25¢ or 30¢ handling fee per transaction if you use PayPal.

Get the Money Your New Business Needs

When it comes to raising money to establish or grow your business, you have more options than searching your couch cushions for change or pursuing traditional venture capital. There are plenty of platforms that will help you crowdfund support and raise money online for your startup.

The best way to get started is to consider your own needs and your goals. With those in place, you can begin to zero in on which fundraising platform will work best for you. Then you can launch your campaign and keep your business moving in the right direction—without turning your own pockets inside out.

Next: Canadian Small Business Grants: Tools and Tips to Get Funding>>