Amazon Partners With Startups To Sell Crowdfunded Products

Online retailer to help entrepreneurs market and distribute orders from their crowdfunding campaigns

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Crowdfunding has become one of the fastest growing and most promising tools for business financing. An increasing number of startups are tapping crowdfunding platforms like Kickstarter.comIndieGoGo.com, and RocketHub.com to line up financing for everything from new films to gadgets, but it is also an area fraught with challenges.

[Related: 5 Awesome Crowdfunding Sites For Entrepreneurs]

At the end of 2014, crowdfunding reportedly had added 270,000 jobs and injected more than $65 billion into the global economy. One of the largest crowdfunding campaigns ever, the video game Star Citizen, has raised more than $69 million on its crowdfunding site. The best performing categories in crowdfunding are consumer products in tech space, such as new consumer products and video games.

Now Amazon.com is getting into this space. The online retailer recently launched a new platform that will help startups advertise and distribute their products directly to millions of Amazon customers, filling an important gap for entrepreneurs trying to reach a wider market of consumers.

According to Reuters, Amazon is partnering with more than 25 crowd-funding platforms like Indiegogo and venture capital firms to offer 200 products on the platform, which is called Amazon Launchpad. Amazon said it is not working with Kickstarter in “any official capacity” for its program.

Some of the products are already available on Amazon.com, but the program will be listed on Amazon’s Launchpad store. Amazon will manage inventory, fulfill orders using its own distribution network, and provide customer service for a margin of the startup’s sales.

Entrepreneurs can attract massive interest in a new gadget through crowdfunding sites, but often find it difficult to actually market and distribute orders on time to a large number of consumers.

“As the pace of innovation continues to increase within the startup community, we want to help customers discover these unique products and learn the inspiration behind them,” said Jim Adkins, vice president of Amazon in a statement. “We also know from talking to startups that bringing a new product to market successfully can be just as challenging as building it.”

Reuters reports that the company will also help companies expand globally when startups are ready to ship products to consumers outside the United States. Startups will also be able to offer their gadgets to members of Amazon Prime; the retailer’s popular $99-year subscription service.