What’s the difference between rewards based crowdfunding and a prize draw?

When it comes to raising money from the crowd, there’s lots of routes you can take! So, you might be thinking, what’s the difference between running a prize draw and running a crowdfunding campaign with rewards? 

Rewards based crowdfunding

With rewards based crowdfunding, you can offer an unlimited amount of rewards at any one time. These can be anything that would appeal to your supporters, including products, services, events, experiences and sponsorship. They could even be the items you’re raising funds to create, such as a copy of your album or special edition of your book. 

Want to know more about the things you can offer? Make sure to check out our blog on 55 reward ideas to get your imagination going. 

It’s important to note that rewards based crowdfunding campaigns usually last for four weeks or more, and a lot of effort goes into keeping the momentum going. 

Prize draws

A prize draw usually has one or a few high value prizes. The best prizes are things that are exclusive, authentic and can’t be found anywhere else. If there’s a connection to a celebrity, sports team or musician – even better! Fans are always keen to get their hands on something that money can’t buy. Looking for inspiration? Check out {{our blog on 7 brilliant prize examples.}}

Not only are they exciting, they’re also a great way of raising money quickly, with the average draw usually lasting two to three weeks. They’re also inclusive, as tickets to a draw are usually £5 per entry, depending on the prize. 

Remember, you’ll need to create some terms and conditions for your draw and have a free entry option. 

Keeping it simple 

A rewards based crowdfunding campaign…

• Can include an unlimited amount of rewards at varying price points
• Can accept straight up donations, as well as pledges for rewards
• Usually lasts for four weeks or more 

A prize draw…

• Usually includes one exclusive high value prize 
• Must have a free entry route, along with terms and conditions
• Usually lasts for two to three weeks