Crowdtilt Wants to Help Crowdfund Your Next Party
Entrepreneur James Beshara has built two crowdfunding websites since graduating Wake Forest University in 2008. It's his second one, Crowdtilt, that has caught the attention of Silicon Valley's biggest players, including Napster's Sean Parker and the venture capitalist firm Andreessen Horowitz.
While the crowdfunding space has entrenched players like Kickstarter and Indiegogo, Beshara thinks there's a void in pooling money for personal events.
"Whether it's for the ski vacation rental in Tahoe with your group, the tailgate coming up, block party, or a school fundraiser, collecting money from a lot of people is a nightmare," said the co-founder.
Crowdtilt lets individuals and organizations pool money or raise funds for events within their social circle. If the group reaches the financial goal set, then all the credit cards are charged and the money is sent in one lump sum directly to the organizer's bank account. Crowdtilt takes a 2.5 percent service charge.
This idea isn't totally new. Eventbrite and PayPal both allow organizers to collect money from groups.
However, Beshara doesn't see either as a threat.
"It's something that PayPal has tried two or three times to make their product more social, and they really struggled in that area," he said. "With Crowdtilt, it started social and social is in our DNA."
(Read More: Q&A with James Beshara)
Besides the social aspect, Crowdtilt's CEO also cites speed as his site's biggest asset in gaining traction.
"Surprisingly, we've only spent $300 to $400 on marketing," Beshara said. "It's all been word-of-mouth growth."
The company isn't releasing how many users have joined the site since it launched in February 2012.
While Beshara said users don't complain about the 2.5 percent service fee, he admited, "Our challenge is to make sure the product is good enough where people say, 'Well, I don't want to use cash even though it's free because Crowdtilt is so easy.'"
The startup is reporting $2.1 million in venture capital from key investors including SV Angel, Y Combinator and Crunch Fund.
James Beshara joins "Power Lunch" on Wednesday, Feb. 27 at 1 p.m. ET. He will take tough questions from CNBC host Tyler Mathisen, AngelList CEO & Founder Naval Ravikant, and CNBC Entertainment and Media Reporter Julia Boorstin
—By CNBC's Erin Barry and Marqui Mapp