Welcome to FundCreators: A Clear Guide for Creators and Backers
Welcome to FundCreators: A Clear Guide for Creators and Backers
FundCreators is a new kind of crowdfunding platform that benefits both creators and backers through a simple profit-sharing approach. This guide explains exactly how our platform works for everyone involved, with no complicated jargon or confusing terms.
What Makes FundCreators Different
Traditional crowdfunding platforms typically work like this: a creator asks for money to make something, and backers receive the finished product or a small reward in return.
FundCreators takes a different approach:
- Creators ask for funding to make their project happen, but instead of just giving out one-time rewards, they share a percentage of their future profits with backers for a set period.
- Backers support projects they believe in, and if those projects become profitable, they receive a share of those profits based on how much they contributed.
It's that straightforward. Now, let's break down how this works for each group.
For Creators: How to Fund Your Project
What You Get
- 100% Ownership: You keep complete ownership of your project.
2. Creative Control: Make decisions based on your vision, not outside investors' demands.
3. No Debt: Unlike loans, there's no obligation to repay if your project doesn't generate profit.
4. Aligned Support: Backers are motivated to see your project succeed, as they only benefit when you do.
How It Works
- Create Your Project Page
- Set your funding goal (how much money you need)
- Define your profit-sharing terms:
- Stakeholder Percentage: What percentage of profits you'll share (e.g., 20%, 30%)
- Duration: How long you'll share profits (e.g., 2 years, 3 years)
- Payment Frequency: How often you'll distribute profits (e.g., quarterly, annually)
- Promote Your Project
- Share with your network
- Reach potential backers through the FundCreators platform
- Receive Funding
- When your funding goal is met, the money is transferred to you
- You now have the capital to create your project
- Create Your Project
- Use the funds to bring your vision to life
- Provide occasional updates to your backers through the platform
- Share Profits When They Come
- Once your project starts generating profit, you submit simple return reports
- The platform calculates each backer's share based on their contribution
- Profits are distributed according to your predefined terms
Example
Sarah wants to produce an album. She needs £10,000 for studio time, production, and marketing. She creates a FundCreators project offering 25% of the album's profits to backers for 3 years, with quarterly distributions.
After receiving funding, Sarah produces her album. When it starts generating profit through sales and streaming, she submits quarterly reports, and 25% of those profits are distributed among her backers proportionally based on their contributions.
For Backers: Support Projects and Share in Success
What You Get
- Potential Returns: If projects succeed commercially, you receive a share of profits.
2. Support Innovation: Help bring creative projects and businesses to life.
3. Clear Terms: Know exactly what percentage of profits you might receive and for how long.
4. No Hidden Fees: We're transparent about our 5% platform fee and payment processing costs.
How It Works
- Browse Projects
- Explore projects across categories (business, music, film, products, etc.)
- Review each project's profit-sharing terms
- Back Projects You Believe In
- Contribute any amount to projects you want to support
- Your contribution is securely processed through our payment system
- Track Project Progress
- Receive updates as the project develops
- Stay informed about launch plans and milestones
- Receive Your Share of Profits
- If the project becomes profitable, you'll receive your proportional share
- Payments are made according to the schedule set by the creator
- Your share is calculated based on your contribution relative to the total funding
Example
John backs Sarah's album project with £100 (which represents 1% of her £10,000 goal). The album becomes quite successful, generating £40,000 in profit during its first year. With Sarah's 25% profit-sharing agreement, £10,000 is distributed among all backers during that year.
As a 1% contributor, John receives £100 in returns over the first year, already matching his initial contribution. And that's just the beginning. As the album continues to gain popularity through streaming platforms, gets featured in TV shows, commercials, or films, or finds success in international markets, the profit potential could continue to grow throughout the three-year sharing period.
Meanwhile, Sarah maintains full ownership of her music and creative control, while still keeping 75% of all profits. This creates a win-win scenario where both creator and backers benefit from the project's success.
Important Points to Understand
For Creators:
- You Only Share Profits: You share a percentage of profits, not revenue. This means you deduct your costs before calculating what to share.
- Transparency Matters: Be clear about how you'll calculate profits and what expenses will be deducted.
- Profit Sharing Duration: You define how long you'll share profits (e.g., 2 years, 5 years), after which the obligation ends.
- Platform Fee: FundCreators charges a 5% fee on funds raised, plus standard payment processing fees.
For Backers:
- This Is Not an Investment: You're not buying shares or equity in the project. You're receiving a reward in the form of profit-sharing.
- Returns Are Not Guaranteed: You only receive returns if the project generates profit. Support projects because you believe in them, not solely for potential returns.
- Profit Calculations: The creator defines how profits are calculated. Review their terms carefully before backing.
- Proportional Distribution: Your share of the distributed profits is proportional to your contribution amount relative to the total raised.
Common Questions
For Creators:
Q: What if my project doesn't make a profit?
A: If your project doesn't generate profit, you don't have to pay anything to backers. Unlike loans, there's no obligation to repay.
Q: How do I report profits?
A: You'll submit simple return reports through your creator dashboard, showing your revenue, expenses, and profit for the period.
Q: Can I set a cap on returns?
A: Yes, you can set a return cap (e.g., 2x or 3x the original contribution) to limit the total amount paid to backers.
Q: What qualifies as profit?
A: You define what constitutes profit for your specific project in your terms. Typically, it's revenue minus expenses related to the project.
For Backers:
Q: How do I know if a project is generating profit?
A: Creators submit return reports that are available to their backers, showing the project's financial performance.
Q: What happens if a project fails completely?
A: If a project fails to launch or generate any profit, you won't receive returns. This is the risk of backing projects.
Q: How are profits distributed?
A: Profits are distributed through our platform directly to your payment method according to the schedule set by the creator.
Q: Is there a minimum contribution amount?
A: Each project may set its own minimum contribution amount, but typically it can be as low as £10.
Getting Started
For Creators:
- Click "Create Project" at the top of the page
2. Follow our step-by-step guide to set up your project
3. Define your funding goal and profit-sharing terms
4. Upload compelling content about your project
5. Launch and promote to potential backers
For Backers:
- Browse projects that interest you
2. Review the creator's track record and profit-sharing terms
3. Make contributions to projects you want to support
4. Set up your payment information to receive potential returns
5. Follow project updates and watch for return distributions
Real Examples of Suitable Projects
Business and Products
- A new product line needing funds for manufacturing
- A food business expanding to new locations
- A tech startup creating an innovative app
Creative Projects
- Musicians producing albums or funding tours
- Filmmakers creating independent films
- Authors self-publishing books
- Game developers creating indie titles
Community Ventures
- Local businesses seeking community support
- Sustainable projects with commercial potential
- Collaborative spaces and resources
Final Thoughts
FundCreators offers a straightforward alternative to traditional funding methods. Creators maintain ownership and creative control while sharing success with their backers. Backers support projects they believe in with the potential to benefit from their commercial success.
Whether you're bringing a creative vision to life or supporting projects you're passionate about, our platform provides a clear, transparent way to make it happen.
Ready to get started? Browse projects as a backer or create your own as a creator today.
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Note: FundCreators operates as a reward-based crowdfunding platform. Backers support projects in exchange for potential rewards based on profit-sharing arrangements and do not receive equity, securities, or investments. Returns are dependent on project success and are not guaranteed.