Many of my creative friends have been looking at raising money for a project using a crowdsourced funding site like Kickstarter or IndieGoGo. I’ve been reading the advice available for them on the Internet, and having backed a number of projects on these sites, there is information I think would help them that I haven’t seen anywhere else.
Kickstarter and IndieGoGo, if you aren’t familiar with them, sound almost too good to be true. You just put your project up there and thousands–perhaps millions–of dollars roll in through the magic of the Internet!
The truth is that this does happen to the projects with the greatest appeal and best presentation, but many projects get little or no money. On Kickstarter, as of this writing, just 44% of projects reach their funding goal. Their site requires that you meet your funding goal, or they never collect any money from those who backed your project and you get nothing. 56% of projects–that’s more than half–end up this way. IndieGoGo allows you to create a project where you will get what is contributed (minus their service fee) even if you do not make your goal. On IndieGoGo only 10% of projects meet their funding goal. There are other crowdsourced funding sites, but these are the biggest ones.
I’ve looked at more than a hundred projects I considered backing at one level or another (I know a lot of creative people), and it’s clear to me that the creators of some of these projects don’t understand the thought process a backer goes through. I’ve made some suggestions how to make your project attractive to backers below.
Of course, your project, whether it’s a CD or an electronic kit or a book, needs to be something that appeals to backers. If it cannot capture people’s interest, no matter how professional your presentation, people will not back it.
- Do everything you can do without the money. When I was involved in a startup company and talking to investors, this was the advice they gave me. People who back projects think much the same way; they often expect you will get the project to a fairly complete stage.
Before you put the project up on a funding site, you should, as much as possible, have all the difficult creative parts finished, leaving only the straightforward parts that can be done easily if you have money to get them done. Of course some kinds of projects (a film, for instance) this may not be possible.
Most successful CD projects have the music written, recorded and mixed, and the artwork completed so all that is left to do is manufacturing. If you are putting out a book, try to have it written/drawn, edited, etc. and ready for the printer. If you are doing a consumer product, try to have a run of prototypes already made and beta tested, and the final version quoted and lined up at the assembly plant.
I’ve noted projects that ask for funds to finish the initial creative work often do not meet their funding goals, and when I’ve backed such projects, they more often do not deliver. That said, some have been successful.
- Be specific. If you are creating a CD, tell backers the names and lengths of all the songs. If you are creating a book, tell them how many pages, the page size, and how many pages are in color if you have pictures. If you are making a consumer product, give the exact specifications. Backers want to understand what they are backing, and nothing will turn off a backer faster than vagueness in the description of your project.
- Know what you plan to do, and stick to it. I recommend, before you create your project, to get a group of advisors. These can be normal folks who you think might have an interest in backing your project and/or people who may have done their own projects. Show them your proposed project before it goes public, and have them ask questions and make suggestions. Try to anticipate any concerns your backers will have. Make any changes necessary before you go public. While you may add to the project for stretch goals (funding goals beyond your initial goal), do not change the core project.
Once you start changing things, it will be hard to say “No,” to other requests for changes, and many backers will defer backing until they feel the definition of the project is final, which will reduce your ability to hit your funding goal by the end date.
- Have the first batch of backers lined up. Nothing says “failing” to potential backers like a project with just one or two backers. I recommend you get 20 or more people lined up ahead of time who agree to back your project on the day it goes public. This gives your project an initial momentum that will inspire other backers. Encourage your 20 initial backers to share the fact that are backing you on social media.
- Look at successful projects. Get ideas from other projects that have worked well. Here are a couple of my personal favorites. Spock’s Beard offered all their older musical instruments as premiums that people could get for higher levels of backing. Girl Genius had an inspired strategy for stretch goals.
Spock’s Beard CD
- Read the rest of the advice. There is lots of good advice out there about crowdsourced funding; I’ve just tried to cover some practical aspects that others are not covering. Some good advice can be found at these links:
Music Think Tank
Young Entrepreneur Council
All-in-all, it is quite possible to create a successful crowdsourced funding project; it just takes a bit of thought and planning. Good luck on your project!