Crowdfunding Handbook (Part 3)

Funding

Kickstarter uses an all-or-nothing funding model. If your project doesn’t reach its goal, then funds don’t get collected, and no money changes hands. This minimizes risk for creators — imagine ending up with only $5,000 and a bunch of people expecting a $50,000 film! (Why we don't use Flexible Funding) All-or-nothing funding makes it easier for backers to pledge to your project with confidence that you’ll be able to get the job done.

Your funding goal should be the minimum amount you need to make what you promised and fulfill all rewards. The first step to setting that goal is figuring out a budget.

  • Make a list.

    Write down every possible expense — even less obvious ones, like shipping tape and bubble wrap. For larger expenses, research the best price. Total everything up. It’s okay if the number is bigger than expected: even if your project feels simple, it’s best to make sure every step is accounted for.

  • Consider your reach.

    Kickstarter is a great way to share your ideas with new people. Still, most of your support will come from your core networks, and the people most familiar with your work. Consider the audiences you can tap into, from friends and fans to online communities, and make a conservative estimate of how many backers you can really bring in.

  • Give yourself a cushion.

    If your project is successfully funded, Kickstarter applies a 5% fee; there are also additional fees for our payment processors. Every project’s tax situation is different, but that may affect your needs as well. More than anything, you’ll want a little padding in case of unexpected costs or emergencies.

  • Set a deadline.

    Your funding period can last anywhere from one to 60 days. Statistically, though, projects lasting 30 days or fewer have our highest success rates. Shorter periods set a tone of confidence, help motivate people to back, and let you make a planned, concerted push to spread the word.

  • Stretch goals.

    You can’t change your funding goal once you’ve launched. But once that goal has been reached, some projects add incentives — like new features, colors, or gifts to backers — to hit even higher funding milestones. These stretch goals can work for some — but they can also be challenging. They’re a better idea when they improve the work (like adding more levels to a video game), instead of creating something entirely new. 

  • And if your project suddenly explodes?

    Unexpected popularity can be a nice problem to have. But when you designed a budget to make 100 of something, it’s tricky to suddenly have 10,000 pledges! If you feel like you’ve hit your limit, you can always cap your rewards. You can also stagger release dates — cap the original reward at a number you can handle, then add more with a later delivery date, so you don’t have to do everything at once. Let backers know in advance that the demand might affect your schedule.

Your Tools

  • The creator dashboard.

    Your project’s dashboard gives you an at-a-glance view of everything that’s happening: your funding progress, where visitors to your project page are coming from, a breakdown of which rewards backers are choosing — even a complete feed of all project activity.

  • The backer report.

    Your backer report is where all information about your project’s backers will be neatly organized. Everything from the reward that they chose to any messages that you’ve exchanged will be documented here. And once you send out reward surveys, backers’ responses will ALSO be documented here. The report can easily be downloaded as a CSV file.

  • Analytics.

    Google Analytics opens up a whole new world of trusted, powerful tools, from custom reports and dashboards to the ability to track how many visits to the project page are converting into pledges.

  • Kickstarter for iPhone, iPad, and Android.

    The Kickstarter mobile app can help you manage communicating with backers whenever you want, wherever you are! Use it to send messages, post updates, and get at-a-glance looks at how your project is doing.