- Target location: Global
- Platform fee: 5% of total funds raised
- Payments Processor: Stripe
- Model: Reward-based
- Operating from: Brooklyn, New York
- Ideal for: Artists, musicians, techies, filmmakers, designers, startups, small scale businesses, etc.
Kickstarter is one of the global crowdfunding platforms today. It is a fruitful crowdfunding platform for aspiring entrepreneurs and small scale businesses.
Everything from films, games, and music to art, design, and technology. Kickstarter is full of ambitious, innovative, and imaginative ideas that are brought to life through the direct support of others.
Everything on Kickstarter must be a project with a clear goal, like making an album, a book, or a work of art. A project will eventually be completed, and something will be produced by it.
How it works!
Each project creator chooses their fundraising objective and their campaign end date. If the project is successful, the contributors undertake to finance it at the end of the campaign. Contributors’ bank cards are only debited if the fundraising goal is reached. On Kickstarter, funding is based on the “all or nothing” principle: if the funding goal is not reached, nobody pays.
If a project is funded in its entirety, Kickstarter charges a 5% fee on the funds raised.
Why support a project on Kickstarter? What do they offer to contributors?
Contributors get involved for different reasons. Some are mobilizing around a friend’s project. Others want to encourage an artist they have followed for a long time. Many are interested in new products. Others still let themselves be tempted by the rewards offered: a copy of the product, a limited edition or a particular experience associated with the project.
Creators remain 100% owners of their work. In particular, they are prohibited from offering financial instruments or returns on investment, or from soliciting loans on Kickstarter. Some projects funded on Kickstarter end up making money later, but backers support the projects they are interested in to help them see the light of day, not to make money.
Funding on Kickstarter is all-or-nothing. No one will be charged for a pledge towards a project unless it reaches its funding goal. This way, creators always have the budget they scoped out before moving forward.
If a project is successfully funded, Kickstarter collects a 5% fee from the funds collected for creators. Stripe, their payments processor, will also collect a payment processing fee (roughly 3-5%). The complete fee breakdowns are available here.
If a project does not reach its funding goal, no fees are collected.
They established this fee in 2009 and have set an industry standard for creator-friendly funding.
They use this model because they believe in paying artists as much as possible. They are a tool for going around traditional gatekeepers like agents, dealers, distributors, fiscal sponsors, record labels, and publishers, and we accordingly take a much lower cut than they do.
The campaign can last from 1 to 60 days. That said, statistically, projects that last 30 days or less have better success rates. Short campaigns inspire confidence. Contributors feel more motivated, and for your part, you can plan a concerted communication strategy to promote your project.
For more information: https://www.kickstarter.com/?ref=nav