Donation Crowd Funding
Prior to the passage of the JOBS Act, only non-equity capital could be raised through a donation or rewards based
campaign. It is primarily used by artists, musicians, small businesses, politicians or non-profits to raise revenue via an internet crowd funding platform such as Kickstarter or Indigogo.
The group raising the funds initiates a donation based campaign by offering donors a reward (early access to a product or service, public recognition, VIP access to a special event or a feeling of doing good) in exchange for making a donation to a specific project. In this scenario, the donor would not receive ownership or a return on investment.
Definition provided by: Crash Course in Crowd Fund Investing handbook by Crowd Fund Capital Advisors