Entrepreneurs and visionaries of all kinds can be easily confused about the best options for getting the financial backing they need. Now, there are more options than ever — some unimaginable only a few years ago. One of these is Kickstarter, self-described as an online platform for funding creative projects. Since Kickstarter was founded in 2009, nearly 300,000 fundraising campaigns have received pledges of more than $2 billion. Who put up the money? More than 10 million individual “backers” from all over the globe, in amounts as small as $5.00. To date, more than 100,000 campaigns have successfully launched products and projects.
One successful campaign funded production of a feature film based on the TV series Veronica Mars. Nearly 92,000 backers pledged $5.7 million; nicely beating the goal of $2 million. What happened to the money? The movie was the first in history to be produced entirely with Kickstarter funding. It opened in 291 theaters in March 2014, and had an opening-weekend box office of $2 million.
Manufacturers may be inspired by the Kickstarter campaign for the “Coolest Cooler.” Described as a “portable party disguised as a cooler,” the creators started their campaign with a fundraising goal of $50,000, and ended it with a whopping $13.3 million in pledges. The product is for sale on Amazon, but the company is experiencing operational and cash flow challenges.
If you have an idea for a new product or creative project, and are exploring funding options, Kickstarter has proved to be a viable fundraising option for well thought out and inspiring ideas. Project categories include: crafts, dance, design, fashion, films, music, publishing, and technology. Kickstarter has rules governing the fundraising campaigns, and begin with the premise that projects must create something to share with others. The complete list of rules is available on their website.
Funding campaigns come in all sizes. Here is a sample.
$20 Million in Funding
The campaign for the Pebble E-Paper Smartwatch raised more than $20 million, making it possible to produce, and bring-to-market, the first-ever smartwatch. Merely a great idea in 2012, the Pebble E-Paper Smartwatch is now available in several styles at many retailers, including Amazon (Retail price for some styles is $99.). Since its launch, Pebble E-Paper continues to innovate, and now offers its community of users a personal organization system via the watch.
$1 Million in Funding
The “10-Year Hoodie” raised $1 million from backers who liked the idea of a high quality sweatshirt that comes with a 10-year guarantee and free mending. The $99.50 limited-edition hoodie can be purchased at flintandtinder.com.
Under $30,000 in Funding
Coming in on the low end of the scale is “The Playsuit,” a stylish, one-piece luxe-knit garment that looks like a skirt but has the comfort and convenience of shorts. The creators of this product received pledges of more than $22,000 from 364 backers – exceeding their funding goal by 125 percent.
Is Kickstarter a Fit for Your Creative Idea?
Do you have a creative idea but no funds to bring it to fruition? Here are some indicators that Kickstarter may be a good funding option:
- You have a creative project to share with the world — original music, art, apparel, film, or video.
- You are able to present an inspiring story to the Kickstarter community.
- You are able to communicate your idea and dream in a compelling way.
- Throughout the process of bringing your idea to production, you are prepared to share the journey with your backers.
- You are able to develop a reward for those who back your project. With Kickstarter funding, you retain sole ownership of your company, but you provide backers with rewards in exchange for their monetary pledge. Rewards have included copies of a published work, limited editions of the final product, and tickets to film premieres. The types of rewards created are limited only by your imagination.
Traditional funding sources for small and medium sized businesses
Not every product idea or creative concept is a fit for Kickstarter. Most established businesses, and start-ups, in a range of industries and service sectors, need and want financing solutions with predictable terms and reliable timelines. For 20 years, Crestmark has provided visionary entrepreneurs, and small- and medium-sized businesses with customized funding options. Contact us today.