In many parts of the Eurozone, now is not the best time for an entrepreneur to go to the bank and expect to skip away with a loan. But a growing alternative for some Europeans could be crowd-funding websites, which are expanding there.
Indiegogo, a popular site for entrepreneurs to raise money for their projects, added three new currencies today in a bid to draw more users from outside the U.S. Pledges can now be made in euros, British pounds or Canadian dollars, said Danae Ringelmann, the co-founder and chief operating officer of Indiegogo, in an interview.
By the end of the month, Indiegogo will also begin allowing fundraisers’ pages to be written in French or German, the company said. The site, which has been open to users worldwide, will introduce early next year home pages tailored by region for people based in either the U.S., Canada, France, Germany or the U.K, highlighting local projects, Ringelmann said.
“This is something that we’ve been building toward for a long time,” she said. “Thirty percent of our business is international, which is a shockingly big number considering our site is only offered in English and in U.S. dollars.”
By the middle of next year, the San Francisco-based startup plans to establish a subsidiary in the U.K. to reduce costs from its expansion to Europe, she said. New York-based Kickstarter, a giant rival that’s funneled $368 million to its creators, added the U.K. as its second country in October. About 2 million pounds were pledged to British projects in the first month, the company said.
Kickstarter and Indiegogo are going up against European startups, such as London-based Seedrs, which allow for small investments in exchange for equity. That’s something the U.S. companies don’t do because the practice isn’t yet allowed . (A provision of the Jumpstart Our Business Startups Act that hasn’t been implemented yet would change that.)
American crowd-funding popularized the rewards-based system, where a pledge of, say, $30 gets you a T-shirt or $60 gets you a copy of whatever it is you’re backing. Considering that most startups fail, a shirt might not be so bad — unless it’s the one off the entrepreneur’s back.