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Running a business is a tough gig, but what can be even more tough is the process of accessing capital to get up and running. While many turn to friends and family for help with financing, others are wary of jeopardizing cherished relationships with a business transaction.
Many are hesitant to seek out business loans or lines of credit, not wanting to take on an additional financial liability in the form of a monthly payment. Fortunately, there are other options.
Crowdfunding offers a great option to avoid the potential awkwardness, but let your friends and family know that they can help fund your venture.
Plumfund is a free crowdfunding site created for those raising money from friends, family, fans and their community for a cause. Causes can be anything from a charity, to a retirement fund, to health costs, business projects and more.
Specifically for business owners, creating a Plumfund project can help you raise money for business growth or startup funds—such as new equipment, advertising expenses, supplies for inventory, legal and filing fees, etc. Plumfund was created by the owners of Honeyfund, the “free honeymoon gift registry” for couples who want to skip the more traditional wedding registry and raise money for an exciting experience rather than blenders and vacuums.
How Plumfund Works
Small business owners can create a plumfund campaign that serves as a landing page for your friends, family, and customers to donate to your fund after you start spreading the word.
To create your plumfund campaign, you’ll need to select:
- A fundraising goal—how much money do you need to accomplish your project?
- Photos of your business or business project
- A name for your fund
- A detailed description of what your fund is for and why you are seeking capital
- An end date—when do you plan to reach your goal?
You can choose to from two different payment options for your contributors:
- Offline, check or cash. There is no charge for cash or check donations.
- Online, credit or debit card payments. There is a 2.8% + $0.30 fee per credit or debit card transaction, and funds are deposited into your PayPal or WePay account.
Creating a plumfund is completely free, so the only fee you’ll pay is the fee associated with online transactions. There are no requirements—credit or otherwise— to create a plumfund, so all business owners can qualify.
The key to creating a successful fund and hitting your financing goal is going to be the effort you put into making your customers and fans aware of your campaign, as well as marketing your campaign to anyone who may visit your Plumfund page.
Plumfund Success Stories
Not convinced that Plumfund is a good option for your business? Here’s how two businesses are using Plumfund to build and grow their company:
Dough Heads Stuffed Waffles is a startup company raising $10,000 to get their food truck up and running. They are using Plumfund to pre-sell tickets to their grand opening event at the end of May in order to have enough capital to buy all the ingredients needed to prepare killer waffles for their new customers. Dough Heads promises different rewards to contributors based on how much they donate, ranging from a ticket to the grand opening event to real estate on the side of their truck for a business ad.
Brown Eyez Beauty Supply LLC is raising a fund for inventory for their beauty supply store. As they explain in their plumfund page, suppliers in their industry often require upfront payments, and trade terms are not usually offered to new businesses. Much of their capital will be tied up in inventory, so they’re asking for help making sure they have enough to pay their employees, rent, and utilities.
The Verdict
PlumFund may be a good option for startups or established businesses that can invest time in bringing members of their community to their plumfund page. This can be accomplished via emails, social media posts, flyers, etc., and has the added bonus of reminding customers and loved ones of your business venture. You are essentially marketing your business by way of your fund. As an added bonus, Plumfund has no requirements to set up a fund, so businesses with poor credit can utilize this option.
Don’t have time to put into setting up a plumfund? Less time-intensive financing options include:
These options will have stricter requirements than setting up a fund on a crowdfunding website, but if saving time is you number one priority, the expenditure may be worth it.
Before you choose a crowdfunding option or another lender, make sure it’s the right fit. Nav’s financing marketplace shows you the likelihood you’ll qualify for different financing providers before you even start an application. Sign up for a free account to see your likelihood of approval for StreetShares and other financing options.
This article was originally written on December 12, 2018 and updated on November 8, 2019.
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