Collaborative funding is a financial approach where multiple individuals or organizations pool their resources to support a common project or initiative. This method allows participants to share the financial burden and risks while increasing the potential for larger investments. It is often used in areas like community development, startups, and nonprofit projects. This funding model can take various forms, including crowdfunding, where many people contribute small amounts, or joint ventures, where businesses collaborate on a specific goal. Collaborative funding encourages innovation and community engagement, making it easier to tackle challenges that require collective effort.