Kickstart Your Dreams With This Crowdfunding Platform
You just had the greatest idea ever. This is a game changer that the whole world can get behind if you could only prove that the concept works.
And it’s only going to cost…uh oh…much more than you have to get it off the ground.
Fortunately, we have an answer to this problem these days: crowdfunding.
Although there are a number of great crowdfunding platforms out there, we wanted to cover one of the first and most widely used today, Kickstarter.
Founded by Perry Chen, Charles Adler, and Yancey Strickler in 2009, New York-based Kickstarter has helped bring close to 150k creative projects to life with $3.8B pledged by 15M+ backers. Incredible.
As the company prepares to enter its second decade of existence, we plan to start covering some of the most interesting ideas and concepts currently seeking funding on the site. With this article, we are going to provide an overview of how the platform works for those who are unfamiliar and share the story behind its founding to help lay the groundwork for future Kickstarter-focused Untold Business articles.
The Go-To Funding Platform For Creative Projects Like Think Board X
From short films to board games and everything in between, Kickstarter has brought all kinds of projects to life through its sleek and easy-to-use platform.
Kickstarter is specifically designed to help creatives – photographers, filmmakers, artists, etc – cover the costs of completing a project that they independently define and execute.
Here’s how it works.
Individuals or project teams that are seeking funding create a page on Kickstarter’s website that serves as an explanation, or pitch, of the concept to potential donors (“backers”). Fundraisers can upload a video, write out a more in-depth description of their idea, and lay out exactly how funds would be used. Before a campaign launches, fundraisers have to set a funding goal and timeline that cannot be edited once the project page is published and live.
One of the key ways that crowdfunding platforms, like Kickstarter, differ from more traditional capital raises is that no equity or ownership is exchanged through fundraising. Project creators on Kickstarter keep 100% ownership over their work and, instead, offer other types of rewards to those who pledge funding to their projects.
Fundraisers set donation tiers for their projects that define what rewards backers unlock with donations of certain sizes. As pledges increase in value, so do the value of the matching rewards. For example, a $5 donation might earn you a logo sticker whereas a $20 donation might get you a branded water bottle.
Get funded MORE than what you asked for!
Kickstarter is unique from other crowdfunding platforms in that it enforces an all-or-nothing funding policy. If a project does not reach its fundraising goal in the timeframe set during the pre-launch phase, the project team, backers, and Kickstarter all receive nothing.
The all-or-nothing policy protects creators from having to deliver on their concepts with less funding than anticipated and ensures that backer dollars aren’t going to something that does not have the potential to become what they were originally supporting.
For projects that are successfully funded, 5% of the total value raised goes to Kickstarter and another 3-5% goes to Stripe, the company’s payment processing partner.
According to Kickstarter’s most up-to-date statistics, 36% of all projects are successfully funded.
“We Knew That The Idea Was Big”
– Perry Chen, CEO & Founder
Kickstarter is the brainchild of Perry Chen who came up with the core concept for the site back in 2001 while living in New Orleans. He was trying to book two DJs for JazzFest, but was unable to come up with the money he needed up-front which ultimately killed the idea.
This was extremely frustrating to Chen as he was sure that the DJs would generate more than enough in ticket sales to justify their price tags.
Over the next eight years, Perry worked tirelessly to develop a platform that would help creators get their ideas from whiteboard to reality by engaging enthusiastic donors who also believed in the same vision.
He brought in Charles Adler, co-founder of Source ID, and former music journalist, Yancey Strickler to help build out the infrastructure for the site. Together, these three took Kickstarter to launch on April 28th, 2009.
Within three days, Kickstarter had its first successfully funded project and the team made its first full-time hires six months later as the site exploded in popularity.
Today, there are around 3.5k projects seeking funding on the site.
“…a fundamental tool for the liberation or the acceleration of our own creativity.” – Chen
As the company prepares for year 10 and beyond, Chen insists that Kickstarter’s dedication to funding projects and positively impacting society at-large remains stronger than ever.
After a turbulent 2017 that saw Founder Yancey Strickler step down as CEO and a number of senior leaders walk away, Kickstarter is looking to regain stability and evolve within its steadfast mission.
Under the direction of Chen, who has reclaimed the CEO title, the company launched Drip, a platform that enables backers to make consistent donations to creators they believe in rather than fund discrete projects.
Drip is intended to function as a complement to Kickstarter which continues to make headlines on a regular basis with its funding successes.
“We’re not basing our success or failure primarily on growth. It’s about, are we succeeding in our mission? Are we helping creator projects come to life?” – Chen
This Untold story reminds us to dig deep into our personal experiences and frustrations to see what opportunities might exist. It also shows the power of crowdfunding to bring ideas to market that would never have gotten off the drawing board otherwise. It is more than likely that if you are facing a problem, someone else has seen it before and many others will see if after. Find a way to solve your problem and you just might come up with the solution that thousands and thousands of others were searching for the whole time!
Through Kickstarter’s story, we see a company that is fueled almost entirely by the people who it empowers. It started as a solution to a problem that Chen himself faced. He took that experience and created a solution that has since helped make thousands of creator dreams come true over the last nine years.