Reward Based Crowdfunding
It is the type of crowdfunding where you as a backer gets something in exchange for your contribution. This model of crowdfunding is the most popular and is followed by kickstarter, Indiegogo, Grasruts.In Nepal, this is the only legal way of operating a crowdfunding platform.
So, what is the reward that you get in return for your contribution? There is no right or wrong answer to this but it depends upon the Campaign creator. Generally, it is pre sale of the product or service in cheaper price or something completely random.
Wilems (2013) paper outlines which factors contribute to the success rate of crowdfunding platforms. He states that crowd funders are less interested in the financial return they receive from contributing, than they are with the feeling of being part of a community. Although profit maximization is a goal, there is a connection formed between the funder, and the project owner, despite them never needing to meet face to face.
