MAGFAST is a crowdfunded startup project.
What is Crowdfunding?
If you were able to attend one of our online presentations, you’ll have heard Seymour explain that MAGFAST is a crowdfunded startup.
Read on if you’d like to know more about crowdfunding and how it works.
Crowdfunding at a Glance
To put it simply, crowdfunding is funding a project or venture by raising money, from a large number of people or from "the crowd,” typically via the internet.
In recent years, crowdfunding has exploded onto the zeitgeist as a popular funding method through platforms such as Kickstarter, Indiegogo or Go Fund Me. Most people, however, are unaware that the underlying principles of crowdfunding have a long and rich tradition throughout history.
In fact, one of the world’s most iconic images - the Statue of Liberty - would never have risen without crowdfunding. Most folks know that the statue itself was a gift from the people of France. But it was only mounted on its famous pedestal after Joseph Pulitzer, the publisher of the New York World newspaper, started a drive for donations to finish the project and attracted more than 120,000 contributions from readers… back in 1885!
Technology and social media have raised crowdfunding’s profile and given even the smallest startups access to a large enough audience to bring a meaningful new invention to market.
Why is Crowdfunding Needed?
Larger companies have access to other forms of capital, including bank loans and debt financing secured on their assets. Crowdfunding is therefore predominantly the domain of startup companies.
Most startups need some amount of capital to get moving. If you were to start a retail business selling other people’s products or providing services like cutting hair or serving food, you would likely need capital for premises, equipment, staff, advertising and other running costs.
Many modern crowdfunded startups are aiming to do something more “ambitious”: to finalize the development of an invention, then to manufacture it and bring it to market. Enthusiastic supporters of the project fund the work involved by placing advance orders, or ‘pre-orders’, for a product that doesn’t yet exist. The funds they contribute are used to pay for marketing, staff, product development and other costs before the company has a shipping product and can start generating revenue.
There are essentially three types of crowdfunding: donation based, rewards based and equity based.
Donation-based funding is just what it sounds like. It allows people to donate to a cause. Common donation-based crowdfunding initiatives include fundraising for disaster relief, and charities, nonprofits and individuals seeking help with medical or personal needs.
Rewards-based (also known as perks-based) crowdfunding provides an incentive for individuals to contribute to a business or project in exchange for a “reward,” such as a pre-order special discount on the product or service the company offers, or free bonus. The reward or perk is in return for providing funds before the product is ready to ship - sometimes well before.
Equity-based crowdfunding, unlike the donation-based and rewards-based methods, was only recently made legal by an Act of Congress that permits even small private companies to raise capital money from the general public. Instead of a reward or perk, supporters lend money or make an equity investment in the company.
Equity-based and rewards-based crowdfunding are sometimes blended, where a supporter may receive free or discounted products in addition to a shareholding or a promise to repay a loan.
MAGFAST and Crowdfunding of MAGFAST Pre-Orders
MAGFAST is a crowdfunded startup using rewards. We have created our own pre-order platform and offer supporters deep discounts on our products in exchange for pre-orders, allowing us to raise the capital we need to develop, manufacture and ship our family of advanced chargers and power banks.
Crowdfunding will allow us to bring Seymour's revolutionary vision of interconnected chargers from conception to reality. Our contributors will be the first to receive the MAGFAST product range before they are released into the retail market.
When you make a pre-order pledge toward MAGFAST products you set in motion an amazing process: Your pledge (combined with many others) is immediately put to work, allowing us to pay our amazing team and partners to finalize, prototype, manufacture, test, certify, pack and ship your MAGFAST-family products to your doorstep. And to make sure you’re supported all the way.
It's important to understand that crowdfunding is not online shopping.
This project needs hundreds of thousands of backers to raise the millions we need to complete and ship the product range.
It's the enthusiasm and support of awesome people like you who make it possible for innovation to occur. Crowdfunding makes exciting new technologies possible. Because every supporter’s funds are put to work immediately, we ask that people only back us if prepared to support us right through to the finish line.
It's astonishingly hard to create a company and a product range of this sophistication on a small budget. We have had to find inventive ways to do things that larger companies would throw money at. It is with thanks to the enthusiasm of supporters who have pre-ordered MAGFAST Air, Road, Life, Extreme and the Pro Kits by the tens of thousands that we are on track to make revolutionary products we know you'll love.
That’s the power of crowdfunding. Thank you, from all of us at MAGFAST.