Five Advantages of investing in Crowd funding and The Effects of a Logo Design

Posted by Frank Borg on July 16th, 2019

The crowdfunding has proven to be a very profitable way to invest in recent years. It is characterized by having a novel and attractive model so that both investors and entrepreneurs get what they want.

Like all business models, investing in crowdfunding has its risks, unquestionably, but time has shown that this new investment dynamic has many advantages that make it very profitable.

In this article, we will focus on reviewing the main advantages of investing in crowdfunding and the effects of logo design on a potential investor.

Take control of your investment

One of the benefits of investing in crowdfunding is that we can take charge of our money and decide where to invest it. The platforms of crowdfunding give us much information about the options we have to invest and it also allows us to diversify our investments. And of course, everything under your personal criteria.

Different platforms

Since there are different platforms and types of models to invest in crowdfunding we can choose the one that best suits us.

There are types of models that offer us a lower risk. Like the investment per loan, which gives us a greater possibility that the campaign in which we invest returns our money with interest. But without forgetting that in the end there is always the possibility that the entrepreneur fails to pay the loan and lose our investment.

Get guarantees of success

Take for example the restaurant Cinco Taco Bar in California, the United States, which is a successful company and is preparing to open a second location. And for this, he has asked the help of investors to start a crowdfunding campaign. These situations allow us to know the history of the company, trust that our investment will be rewarded, and be part of the growth of the company. Investing in crowdfunding means being aware and responsible for the risks that are assumed, it is always possible to find options like the one mentioned above, with which you can feel that your money is in good hands.

Communication with entrepreneurs

Another advantage of investing in crowdfunding is the freedom to communicate with the entrepreneurs of the projects in which you have invested. This fact can make your investment something more constructive and proper since you can contribute your knowledge in the projects you invest to ensure even more success and the final gains.

A huge investment is not necessary

For most platforms, it is not a requirement that you have a bank account with millions of euros. When it comes to investing in crowdfunding, some of the initial money entries can be as small as 25 euros.

Invest in crowdfunding can be as risky as you want, you can put as much money as you want and use the criteria that we find more correct to choose the project to invest. All these elements make it a novel, attractive and profitable experience for people who venture to invest in crowdfunding.

So do not think more and start navigating the interesting world of crowdfunding, you can be sure that you will find a place for you. There are many projects waiting to be supported and you can be the one who does it and, in passing, get juicy profits.

importance of a company logo in crowdfunding

According to recent research, logo design of a company may not foretell a venture's profitability. However, if investors perceive them as complex, they can help you rack up on equity crowdfunding platforms.

Former studies show that cues that are strongly associated with a startup have a huge potential for success. Signs like the size of the equity raise, patent ownership as well as the founders' education/ network, influence crowdfunding investors.

Many research teams from France, Canada, and the United Kingdome suggest that a company's logo design, one with a more tenuous visual cue, has a higher chance of swaying crowdfunding backers investors.

Company logos pervade crowdfunding platforms. However, very little is known about the effects of these visual cues on the behavior of an investor.

After conducting a detailed survey along with multiple experiments and a field study, reports that backers interpret the complexity of a logo design as a sign of venture's innovativeness. Because of this, most investors tend to invest more in companies with complex logos.

According to a student done by the famous researchers from the Wilfrid Laurier University located in Canada, Montpellier Business School in France and the University of Westminster in London. Most investors see complicated logo designs as a sign of innovativeness, as the image looks more meaningful and difficult to process, and due to that, gives a less familiar feel

Another research approach field data are taken from a top equity platform of crowdfunding which shows that the complexity of a logo can boost funds invested in a venture. As per the results, these researchers stated that only a one-unit increase can lead to an eight percent decrease in the overall amount of investment.

Such effects are similar to the effect of a stronger number of previous pledges and cues venture team size.

In addition to that, the researchers did a survey on 2,630 people by recruited them on different crowdsourcing platform and rate multiple logo ventures on two equity crowdfunding platforms. Each venture rated 2 logos that were chosen randomly. Half were asked to rate a venture based on the perceived innovativeness, where the other half participants were asked to rate logo complexity.

The results prove that the complexity of a logo was positively associated with venture innovativeness.

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Frank Borg

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Frank Borg
Joined: July 16th, 2019
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