What is defined as raising money for a project by collecting small amounts from a large number of people?

Crowdfunding is a method of raising money for a project by collecting small amounts from a large number of people, typically through online platforms. This approach allows entrepreneurs, artists, and innovators to reach a broad audience for financial support, often in exchange for rewards, equity, or simply the satisfaction of contributing to a project they believe in.

Unlike sponsorship, which involves a company funding a project in exchange for promotional benefits, crowdfunding focuses on gathering individual contributions from the general public. Angel investing and venture capital refer to more traditional forms of investment where an individual or firm provides significant sums of capital in exchange for ownership stakes and typically expects a higher level of engagement and return on their investment. In contrast, crowdfunding democratizes the fundraising process, making it accessible to anyone with an idea and a compelling pitch, regardless of their network or connections in the investor community.