KickStarter Review and Overview
Kickstarter is a leading crowdfunding platform and one of the more popular companies involved in crowdfunding. The platform targets creative projects and helps bring them to life. Founded in 2009, Kickstarter is very successful and has helped raise over $1.5 billion for individual creative works in that time. For project leaders, then Kickstarter take a small commission of funds raised. Supporters (or backers) are only charged when the project meets the funding goal.
Kickstarter is the prominent crowdfunding platform and is fairly synonymous with the crowdfunding movement. For leaders and backers, this provides both opportunities and solutions because there are so many projects. For leaders, there is more competition to stand out and generate buzz about your project. For backers, the amount of projects means there are likely more chances for nefarious activities from potential projects.
The basic premise is people that want to create a project sign up and provide a video that showcases the purpose of the project. The project will have its own campaign page that includes the video and other pertinent details. Kickstarter is a rewards-based crowdfunding platform, so backers expect to receive some form of gift in exchange for providing money. For example, projects to create a book or movie generally provide a copy of the final edition.
Kickstarter focuses on raising funds for creative projects and has amassed a large number of fans, including celebrities that look to engage fans to raise funds for their projects. One prominent reason for Kickstarter’s success is the emphasis on community. Amanda Palmer, a popular musician who lead a successful campaign, describes the community:
“There’s just something magical about Kickstarter…You immediately feel like you’re part of a larger club of art-supporting fanatics.”
To differentiate the platform, Kickstarter promotes 7 Things to Know:
- Kickstarter is a new way to fund creative projects – There are no size or scope limitations or requirements to add your project. If it’s creative, it’s for Kickstarter.
- Each project is independently created – It’s your project, you own the rights and responsibilities to your supporters.
- Together, creators and backers make projects happen – Successful projects need to engage supporters, so find ways to show your passion and the project’s purpose.
- Creators keep 100% ownership of their work – Backers receive no financial benefit from supporting projects, as a supporter, ensure your commitment to the end result (and reward).
- Creative works were funded this way for centuries – seeking funds from patrons is timeless and Kickstarter is an extension of the model using technology.
- Backing a project is more than just giving someone money – Projects are lead by real people, so any support helps individuals create their dreams.
- Our mission is to help bring creative projects to life – Kickstarter believes creative and artistic projects makes the world a better place and wants to build a community to make amazing new projects.
Kickstarter emphasizes creative projects, but there are many types of campaigns that are listed on the platform. However, to help drive awareness of certain campaigns, then Kickstarter does list some projects on the home page.
As shown, there is a human element to help increase some projects meet their funding objectives. There is some controversy over this process because Kickstarter can select the projects that are most interesting or have the best production.
Kickstarter describes project leaders as creators. Prior to submitting an application to fund projects on Kickstarter, then prospective leaders should review the rules. Projects must:
- Create something tangible to share with the world.
- Provide an honest plan and not mislead potential backers.
- No fundraising for charity or offer financial incentives.
There are also a few prohibited items that generally attempt to keep the platform focused on creative goods. Projects related to healthcare cures and alcohol are among those prohibited.
Leaders should be aware of the importance of the initial video. The project should highlight its purpose and why it should exist. Kickstarter vets the applications, so take the time and effort to produce a high quality video as part of the submission process.
Other key items to note is Kickstarter requires a specific end date. Once the campaign is over, then leaders can no longer provide updates to the Kickstarter page. This means future communications (like updates on the project status or saying thank you) must be done off the platform.
Kickstarter also provides the Creator’s Handbook that provides great information to ensure your campaign is a success.
Importantly, leaders should note that campaigns are all or nothing. This means if campaigns aim to raise $500 and only raise $450, then leaders do not receive any of the funds. For successful campaigns, then Kickstarter charges 5% of the total funds raised.
Kickstarter takes strides to promote projects that meet the guidelines and rules. The platform provides information as Trust and Safety to try to ensure backers understand some of the risks.
There is the chance that funded projects will run into some problems. If a backer funds a movie from a first-time filmmaker, then there is a chance that problems may arise. At times, there are significant delays in providing the rewards, which are not fraud, just issues with managing large-scale projects.
Kickstarter recommends some basic ideas to help backers feel comfortable about the funding projects. Essentially:
- read comments from other supporters so everyone is on the same page.
- ask questions about the project so the leader can communicate their ideas.
Based on Kickstarter statistics about 44% of campaigns are fully funded, so the platform does its part to help ensure qualified projects are listed.
Importantly, backers should note that campaigns are all or nothing. This means if campaigns aim to raise $500 and only raise $450, then backers are not charged and should not expect any of the rewards.