Even as capital markets regulator SEBI is yet to come out with guidelines on raising funds through crowd-funding, Bengaluru-based Fueladream has launched a platform to help entrepreneurs and social causes raise capital from individuals. The platform goes live on Wednesday.

However, the amount will go as charity, with tax benefits, as individuals are not allowed to pick up equity stakes in any venture through crowd-funding platforms at present.

Founded by Ranganath Thota in June 2015, Fueladream is a ‘marketplace’ for people and organisations that aim to raise funds for creative ideas, causes, charities, events and community-led activities.

The venture has raised ₹1.7 crore in seed funding, and is looking for another angel round in two months to build the platform, advertise and create content for all the ideas and causes that get listed.

It has its own business development team, content writers and graphic designers to help the campaign owners put their stories across in a compelling way

Fueladream has already listed about 12 projects, of which about six are non-financial ones, ranging from saving animals to conservation of water and helping kids with cleft lips. The rest are ideas or start-ups working on ventures like electronic cycles, reversible linen shirts, a music band and a template for the visually challenged to recognise various denominations of currency.

It plans to list 20 projects every month, and has partnered with HDFC Bank for a payment gateway. Individuals can donate anything above ₹100. Fueladream charges about 9 per cent commission fee of the total fund raised by the start-ups/causes.

Huge opportunity

Thota told BusinessLine the initiative focuses on the ideas and charities segment of crowd-funding that aims to impact 2.2 billion people in India, Africa and South-East Asia. It is focused on the developing markets and looks to both disrupt the traditional ways of raising funds here and create an alternative mode of funding.

Crowd-funding is defined as the practice of funding a project or venture by raising monetary contributions from a large number of people, often via internet-mediated registries. But the concept can also be executed through mail-order subscriptions, benefit events and other methods. While it is quite popular in the developed markets, the concept is catching up fast in India.

There are two types of crowd-funding — equity and non-financial.

“We are catering to the non-financial part, which is a $12-billion opportunity and is growing at 70 per cent year-on-year. In India it is growing fast as Indians by nature believe in charity.

“Last year individuals in the country gave away ₹40,000 crore towards non-religious charity and this is a huge opportunity for a platform like us that help social causes and needy entrepreneurs raise money from people.

“We have a team that does due diligence on the causes and ideas which get listed on our platform so that no one can misuse it,” Thota said, adding that the donors can see online how much funds an idea is raising, or what progress a particular project is making.

The global market size for crowd-funding has gone up from $6.1 billion in 2013 to $34 billion in 2015. It has been predicted that by 2025, the global crowd-funding market will grow to $90 billion.

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