Financing a start-up or seeking funds to take your business to the next level is more challenging than birthing ideas. However, crowdfunding is one of the most viable ways to finance a business or innovative idea. This is a concept many Nigerians are familiar with, hence the quest for the best crowdfunding in Nigeria.
The best crowdfunding platforms in Nigeria that work for businesses are NaijaFund, Indiegogo, Kickstarter, FundAnEnterprise, CircleUp, Crowdfunder, and QuickRaiz. However, crowdfunding is only suitable for some businesses, and there are other options for business funding to explore.
Getting funds from mostly unknown people could sound too good to be true. However, it’s a financing option you can significantly benefit from if you look in the right places. Hence, we put together this well-sorted list to ease your journey to financing your business in Nigeria.
Is There Any Crowdfunding Platform in Nigeria?
Yes, there are platforms to seek crowdfunding in Nigeria. The good news is that almost anyone can create a campaign or put out a quest for public financing. However, it isn’t entirely uncontrolled, as some regulations for MSMEs require that they be incorporated as a Nigerian company.
Best Crowdfunding in Nigeria
There are many options, but the best crowdfunding platforms in Nigeria that work for businesses are:
NaijaFund
NaijaFund is a crowdfunding platform with a base in Nigeria. It enables fundraising for various projects, including business.
How NaijaFund Works
It is the virtual bridge between fund solicitors and those interested in contributing their widow’s mite to the cause. One of the appealing features of the site is that you can connect your NaijaFund account to social media platforms. However, 10% of every donation you receive goes to the platform.
How to get started on NaijaFund
Visit the NaijaFund website to create your business campaign and link your payment details to your account page.
Kickstarter
This is one of the early global platforms and a worthy contender for the best crowdfunding in Nigeria. It claims to have financed thousands of projects worldwide for different causes, including business. However, it’s best for funding creative businesses such as writing, designing, filmmaking, and other creative projects.
How Kickstarter works
This donation platform works on everything or nothing. That means if you cannot reach your target, the donations are reversed to the senders, regardless of the amount raised.
Also, running a campaign for your project on Kickstarter is free. However, it charges a fee of 5% of the total funds received and a 3-5% processing fee.
How to get started on Kickstarter
You can visit the Kickstarter homepage to register and seek funds for your project.
QuickRaiz
QuickRaiz is another platform for crowdfunding in Nigeria. This Nigerian-based platform enables individuals and groups to solicit funds for any cause of interest. QuickRaiz connects solicitors with potential donors via various payment channels and social media integration.
How QuickRaiz Works
QuickRaiz works by helping registered members raise funds in an easy and safe online community. Going through their site, you see a list of ongoing and completed crowdfunding targets for different causes.
How to Get Started on Quickraiz
Visit the Quickraiz website to begin fundraising for your business.
Crowdfunder
This is a crowdfunding platform that helps business owners solicit funds from a crowd of investors. However, it’s an equity-based website with thousands of angel investors and venture capitalists to market your business ideas for financing.
How Crowdfunder Works
Creating an account on Crowdfunder and maintaining a private profile are free. However, you must make a monthly subscription commitment if you choose to create a public profile. Note that a public profile gives you a better chance of connecting with investors in your business.
How to Get Started on Crowdfunder
Simply visit the official Crowdfunder website to complete your intention form and follow the subsequent processes.
FundAnEnterprise
This crowdfunding platform enables users to seek donations for causes in the form of grants. The donations are mainly to support startups and small and medium-scale businesses in Nigeria and beyond. DailyTrust News reported that FundAnEnterprise also aims to improve how Nigerians and others contribute to business success.
How FundAnEnterprise Works
FundAnEnterprise works by mobilising funds to support registered users. The donations in the form of grants are then diverted to solving the financing needs of startups. However, they monitor potential beneficiaries of the grants for a year to ensure the funds are spent on thriving businesses.
How to Get Started on FundAnEnterprise
Simply register on the FundAnEnterprise website and join the list of potential benefactors of the donations.
Airfunding
Airfunding is one of the best crowdfunding platforms that works for businesses in Nigeria. With over 130,000 global supporters, Airfunding has garnered donations to finance numerous projects, including businesses in Nigeria and other nations.
How Airfunding Works
The Airfunding platform operates on a donation-based model. It allows individuals from any country to effortlessly generate projects by registering, starting, and spreading the word. There is no need to worry about language barriers, as the website is available in 17 languages.
How to Get Started on Airfunding
Visit the AirFunding website to get started.
CircleUp
CircleUp is one of the best crowdfunding in Nigeria that works for businesses focused on growing or producing consumer products. It is an equity crowdfunding platform for entrepreneurs seeking to launch their consumer brands.
How CircleUp Works
CircleUp features an exciting range of services to support producers of consumer goods. For instance, it connects entrepreneurs with investors, offers insights from relevant technologies, and provides access to loans for startups.
How to Get Started on CircleUp
Start by submitting an application for funds on the CircleUp website.
GoFundMe: Is it Ideal for Business Crowdfunding?
GoFundMe is one of Nigeria’s most popular options for the best crowdfunding. But contrary to some internet articles, it is not ideal for business financing. This is because GoFundMe is committed to raising funding for social-centric causes, whether personal or for an organisation.
However, you could still use it to seek funds for your business idea. All you have to do is state your motive for the fundraising in your project description and campaign pitch. This is important since there is no business-related or generic option to choose from while creating your campaign on GoFundMe.
Registration is free, but the platform charges $0.30 on each donation and an additional 2.9% for transaction fees. Also, Nigeria is not one of the 19 countries it currently supports. However, you can get someone in any of those countries to create the project on your behalf.
Patreon: Does it Work in Nigeria?
Patreon is a crowdfunding platform that allows business owners with online followings to raise money from their followers. This is particularly beneficial to content creators with large and loyal followers on the Internet dedicated to supporting their work.
However, contrary to the opinion of many online content creators, Patreon doesn’t work in Nigeria. Gaining access to the site from Nigeria requires more than just clicking on the site link.
To access the site, you’d have to go through the hassle of changing your VPN. But note that there are no payment methods when you decide to even use a VPN. Hence, it’s not an ideal example of crowdfunding in Nigeria that works for businesses.
Funding Options for Businesses Not Eligible for Crowdfunding
Based on specific Nigerian fundraising regulations, crowdfunding activities are formally disallowed for private companies in Nigeria. Aside from that, your business may not fit into the crowdfunding platforms’ list of causes they cater to. But do not fret, as these are other funding options for your business.
Venture Capital
Venture capital firms invest in promising companies by providing funding in exchange for ownership. They typically focus on established businesses with a strong track record and potential for profit. Once you submit a business plan for evaluation, if interested, the firm or investor conducts a comprehensive assessment of various factors.
See our article on venture capital firms to help you get started.
Family and friends
They’re valuable sources of support for small business owners who lack a solid financial track record to secure loans from banks. This option is less likely to impose strict terms or high interest rates, making it a more accessible funding option.
Angel investing
Angel investing involves raising funds from wealthy individuals who want to support the growth of a business. These investors provide seed money and receive equity in return. They often offer more than just financial support, bringing their expertise to help ensure the startup’s long-term success.
You can locate some of the top angel investors in Nigeria with out guide.
Business incubators
Incubators such as Co-Creation Hub support early-stage startups by providing marketing, networking, infrastructure, and financing assistance. Economic development organisations fund them, and their main goal is to build businesses from the ground up. Startups must undergo a rigorous application process to demonstrate their potential for success in joining an incubator programme.
Government loan
Government grants and loans provide valuable support to entrepreneurs and can significantly boost their businesses. These funding options are most suitable for businesses that meet specific criteria. Nonetheless, familiarise yourself with the eligibility requirements and application procedures to increase your chances of success.
Bank Loans
Bank loans have long been regarded as a conventional and trustworthy avenue for obtaining funds for your business. They provide a range of loan options specifically designed to cater to diverse business requirements. However, you need a well-defined path and a dependable strategy for repaying the loan to qualify.
We’ve listed all the banks, government bodies, and organisations offering SME loans. You may want to check it out.
Final Thoughts and Tips
Lack of funds is a common factor affecting entrepreneurship, especially in developing countries like Nigeria. Hence, many have resorted to utilising the best crowdfunding in Nigeria to mobilise funds for their businesses.
When opting for crowdfunding as a means to fund your business idea, it is crucial to approach it with careful planning. One effective strategy is to enlist the assistance of professionals who can aid in presenting your idea. Any efforts to enhance your campaign’s visibility and awareness significantly contribute to your crowdfunding endeavor’s success.
FAQs
How does crowdfunding work for businesses?
Crowdfunding operates by gathering small amounts of capital from diverse individuals to support different causes, including businesses. Through online platforms, crowdfunding campaigns have demonstrated remarkable success in raising funds without requiring upfront fees. This approach enables entrepreneurs to cultivate extensive networks, garner media recognition, and attract potential investors to their business ventures.
Does Airfunding work in Nigeria?
Yes, Airfunding works in Nigeria. It’s an international crowdfunding platform that operates on a donation-based model. It allows individuals from any country to effortlessly and promptly create fundraising projects to gather financial support globally.
Does GoFundMe work in Nigeria?
At the time of answering this, GoFundMe supports 19 countries, and Nigeria isn’t one of them. However, you can find a trusted person in any supported country to champion the campaign on your behalf. The pioneer will add you as a beneficiary to enable you to monitor the campaign’s progress from Nigeria.
Does Indiegogo work in Nigeria?
Indiegogo works in Nigeria but doesn’t support the creation of an account for Nigeria. Hence, choose any supported country during registration and enter the other details that prove you truly live there. Otherwise, have someone in any of those countries pioneer your campaign.
Can I use Kickstarter in Nigeria?
Yes, you can. Kickstarter enables entrepreneurs, including those from Nigeria, to secure project funding. Utilising Kickstarter in Nigeria involves a straightforward process of submitting your project to the platform. Afterward, you share it with your friends, acquaintances, and others to contribute funds.
