Crowdfunding platforms are like shared piggy banks where lots of people can put their money together to help someone get something they want.
Imagine you really want a new toy, but you don’t have enough coins in your piggy bank. Instead of asking just one friend for help, you could ask many friends, and maybe even your whole class! That’s what happens on crowdfunding platforms. People post their ideas or projects online, and others can give them money to make those ideas come true.
How it works
On a crowdfunding platform, someone might say, “I want to start a bakery, but I need $10,000.” People who like the idea can give them some money, maybe $5, $20, or even $100! If enough people help out, the person gets their goal amount and can make their dream come true.
Sometimes, people get extra rewards for helping out. Like if you give $50, you might get a special cookie from the new bakery. It’s like getting a thank-you note, but with real treats!
Examples
- A group of students needs money to build a robot for a competition, so they post their idea on a crowdfunding site.
- An artist creates a video showing how they want to make a new album and asks people to contribute funds in exchange for a song.
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See also
- What is 7% interest every year?
- What is stimulus?
- What is $1,144.90?
- How did Ancient Banks Work?
- How do credit cards function and what makes them secure?