Crowdfunding creates funds for new projects using the Internet and social media. This can help small business projects get the funds they need. A project receives small investments from a wide range of individuals through web advertising and social media. Individuals (investors) who invested in the project may receive incentives such as product discounts, early opportunity to purchase their products, inclusion of their name in the list of contributing founders, etc., they do not therefore do not buy the company's share. Crowdfunding eliminates the need to seek funds from banks, friends and family. It also avoids giving up partial ownership of their business. Websites like www.rockethub.com, www.peerfunding.com, www.kickstarter.com are some examples of crowdfunding. Crowdfunding is mainly useful for new entrepreneurs. It helps them raise funds to support their projects and protects investors from fraudsters and has proper rules from the government. This article mainly focuses on how crowdfunding works, different types of crowdfunding platforms, the status of crowdfunding in different countries, and the strengths and weaknesses of crowdfunding. The way crowdfunding works is based on collaboration between investors, intermediaries and entrepreneurs. Investors are a large number of ordinary people who can donate a small amount of money for ideas they find interesting. Intermediaries are crowdfunding sites. These websites allow investors to invest money in projects that interest them. These websites connect investors and entrepreneurs. These are the entrepreneurs who request financing for their projects. Entrepreneurs publish their project description in crowdfunding...... middle of paper ...... publicly can easily be stolen. • It is solely internet based. The entrepreneur lacks advice. • Startups (funded by crowdfunding) are riskier and the failure rate is very high. Crowdfunding is a valuable and useful tool in today's world. This has many advantages. Weaknesses can be exploited and lead to a better system. References: Colgren, D. (2014) The Rise of Crowdfunding: Social Media, Big Data, Cloud Technologies. , 96(4), 56-57.Salzsieder, L. and Cornell, DW (2013) A critical look at the JUMPSTART BUSINESS STARTUP ACT. , 83, 18-27. Turban, E. and Volonino, L. (2013). A look into the future of information technology. Information Technology for Management Promoting Sustainable and Profitable Business Growth (9th ed., ). : J. Wiley & Sons.Jegeleviciute, S., & Valanciene, L. (2013) Valuation of crowdfunding: advantages and disadvantages, 18(1), 39-50.