Crowd funding takes the citizen-funding idea to another level. Your request for money is sent online to interested investors who may live in far-flung areas of the country or world.
There are various platforms for this kind of funding, such as Kickstarter.com, Peerbackers.com and Ideavibes.com, where you can advertise your business project and solicit pledges. Each platform works differently. Some offer investors varying levels of return on their investment -- even in the form of products.
"If you get enough interest in pledges, you move forward with the project. So it creates a proof of concept for the market and provides unique access to capital," says Anastasia Valentine, chief executive of Ottawa-based Sandbox PM, which operates Ideavibes.com.
She says entrepreneurs looking into crowd-funding options need to have a clear vision of what they want financed before signing up on a funding site.
"Demonstrate you are serious," Valentine says. "State exactly where the money is going to go. If you have a product, offer photos of your prototype."
Valentine says that crowd funding is not only a viable way to fund a business venture but can be a way to attract loyal supporters: "This fan base can be turned into customers," she says.