Fan funding is an alternative to traditional small-scaled financing that provides the means to transform a promising idea into profitable reality — without having to pay back a penny. Rewards-based fan funding is the most popular type of crowdfunding.

What is rewards-based fan funding?
Rewards-based, or seed, fan funding is a type of small-scaled financing in which artists solicit financial donations from their fans in return for a product or service. There are about 19 times as many rewards campaigns as there are for its closely related counterpart, equity-based crowdfunding.

HOW DOES IT WORK?
Artists describe their campaign and fundraising goal on our fan funding platform. In return for donations, artists provide successful campaign and consolation rewards. For example, XYZ Band might reward all of the fans who contribute $20 with one of their original t-shirts, or the XYZ Band might give backstage VIP tickets to contributors at the $100 level. If the campaign is not successful, the fan still gets the consolation reward.

Example: Success reward @ $20 - A new CD.
Consolation redard @ $20 - an autographed thank you note.

WHO IS IT GOOD FOR?
This type of financing is geared toward musicians, that don’t qualify for traditional small-business loans but have compelling campaigns or want to test a market.

WHO CAN CONTRIBUTE?
Anyone — family, friends, fans — can contribute to a rewards fan funding campaign. Individual donations are often small, so artists need to persuade as many people as possible to pitch in. Often, the campaign is shared on social media with the hope that the artist’s followers will, in turn, share the campaign with their networks.

IS IT FREE?
Our platform charges 10% of funds raised, a $2 per connected campaign fee, and an additional credit card processing fee of 2.3%.

Rewards-based fan funding pros and cons
Rewards fan funding allows artists to get new ideas off the ground without the burden of repaying a loan. Before jumping in, consider the pros and cons:

PROS
It’s one of the cheapest ways to raise capital
No collateral, credit check or previous business experience is needed
The process is simple and doesn’t require professional financial or legal help
Exposure gained on the platform can help establish a broader fan base and brand awareness 

CONS
You must actually engage your fans regarding the campaign. It's not a create and watch system. 


How to get started
To start a reward fan funding campaign, REGISTER on MusicMerchNow! and when you're ready, Create a New Campaign. Once the campaign ends, it's crucial to follow through on the rewards. 


You’ll need a convincing pitch that appeals to as many people as possible, as well as attractive rewards at all donation levels both success and consolation. An entertaining, informative video can help sell your idea. For the broadest exposure, reach out to family, friends and associates via email and social media.