Crowdsourcing and crowdfunding are two terms that are often used interchangeably by those who don’t know their primary difference. However, the truth is that there is a significant difference between the two terms. And if you are interested in any of the two, you will have to know what this difference is.


Crowdsourcing is mainly the practice of obtaining services, ideas, content or help by asking for contributions from a large group of people. These contributions, which are often offered in an online community, are used to subdivide tedious work or to fund a startup company, charities and other such things. However, even though most crowdsourcing is done online, you will find that many opt for offline efforts as well.

Overall, crowdsourcing helps self-identified volunteers, entrepreneurs, and part time workers to come together and combine their talent or assistance in order to achieve a much greater result. However, bear in mind that crowdsourcing is very different from outsourcing, which is when you divide a task or projects to an undefined public rather than to a specific group that is well known.

Even though the word crowdsourcing was formed in 2006, it has a number of things that can be done under its name. For example, some people may use crowdsourcing as a technique to divide the labor for tedious tasks, while others use it for specific requests such as crowdfunding or crowdvoting.


Simply put, crowdfunding is a part of crowdsourcing. For instance, if you want to build a house and you rely on crowdsourcing, you would ask people to help you out with the architecture and construction, and others to fund the project by contributing or investing in it. This monetary help that is being provided to you is crowdfunding.

Because crowdfunding has become very popular and a very helpful tool for people all around the world, there are various websites that help people come together to join in the crowdfunding process. One such well known crowdfunding tool is Kickstarter, which is known to be the biggest website for funding creative projects.

Another website which serves as a platform for volunteers to meet is Crowdrise, which is one of the legitimate websites for the purpose. However, one setback of these growing crowdfunding websites is that not all of them are appropriate and some of them may have members that run away with other’s money.

So, the next time someone asks you about the difference between crowdsourcing and crowdfunding, don’t forget to explain that crowdfunding is one of the many types of crowdsourcing and mention the information you had learned.