Feb 18, 2016 (LBO) - Sri Lankan start ups will be able to utilize a new crowdfunding platform, crowdisland.lk, launched on Wednesday with the backing of an experienced group of investors famiiiar with Sri Lankan companies, its founders said. Crowdfunding is the process of raising money to fund a project or business venture through many donors using an online platform. "Sri Lanka is witnessing a strong start-up culture that is sowing the seeds of innovation-driven growth for the future," said Jeevan Gnanam, a co-founder of crowdisland.lk. Gnanam has mentored over 15 startups is the developer behind Sri Lanka's first operational IT park, Orion City. The initiative is also backed by York Street Partners, a boutique investment bank based in Sri Lanka that focuses on M&A, capital raising and strategic advisory services. Sujendra Mather, managing director of York Street Partners, said, "We aim to start from a slightly limited platform of equity crowdfunding from mainly high net worth investors, and work towards larger scale project crowdfunding that can reach rural entrepreneurs, once the government implements a more supportive regulatory framework." According to Mather, Sri Lanka's Companies Act allows a private company to have a maximum of 50 shareholders which is prohibitive of some crowdfunding projects. "Payment gateways have been hesitant to support us due to their unfamiliarity with the concept. We would also like to see the SEC getting involved and supporting the concept," Mather said. The founders believe crowdfunding fills a gap in the financing space that the banking system typically does not fill. Young businesses, in this scenario, struggle to raise early stage capital for growth. Crowdfunding could typically raise between 500,000 rupees to 20 million rupees in a Sri Lankan context, a official of the company said. Amy Wilkinson, of the Stanford Graduate School of Business, who was present at the launch, noted that crowdfunding allows startups much needed marketing exposure and opens doors to alternative forms of financing. Crowdfunding platforms such as Kickstarter, Indiegogo and Crowdfunder are being extensively used in Silicon Valley, she added.