Kickstarter | Raising Funds by Crowd and Getting Customer Feedback

© | Gil C

According to founder Perry Chen, “Kickstarter is about creative projects and art, not investing or shopping.” In this article we will look at 1) what is Kickstarter?, 2) why and when to use Kickstarter, 3) benefits of using Kickstarter, 4) options to raise funds and fees on Kickstarter, 5) how to run a successful Kickstarter campaign, and 6) Kickstarter success stories.


One of the most recognizable and well-known crowdfunding platforms, Kickstarter was launched in 2009 in the United States. The company aims to support the execution of creative projects. According to reported figures, the company has received $1 billion in pledged amounts from close to 5.7 million backers. These funds have been given for 135,000 projects in diverse categories such as film, music, stage shows, comics, journalism, video games and others.

In return for their donations, Kickstarter backers often receive rewards, special experiences, or first access to a unique product or service. Among the reasons for Kickstarter’s popularity are its lower rate of failures, more active communities and straightforward payment plans.

Kickstarter’s successful projects include the Veronica Mars movie that raised $5.7 million, Pebble Watch, that raised $ 10 million, and Oculus Rift which raised $2.5 million and was later acquired by Facebook for $2billion.


The company began in 2009, launched by partners Perry Chen, Yancey Strickler, and Charles Adler. It was named by The New York Times as “the people’s NEA” that stands for the National Endowment for the Arts. It was also separately named the best invention of 2010, as well as the best webpage of 2011. Funding was raised through a combination of venture firms and angel investors.

The website began as a US only platform but eventually expanded to the United Kingdom in 2012, Canada, Australia and New Zealand in 2013 and Norway in 2014. In 2013, the company also expanded to mobile presence for the first time with a Kickstarter app for the iPhone.

The company has had $1,415,440,289 pledged to various projects. 74,307 projects have been funded successfully by 7,466,459 backers of which 2,237,023 are those who have backed more than one project. These figures are updated by Kickstarter daily.

Kickstarter campaigns range across a variety of categories, but the focus remains predominately on the arts with top six categories of successfully funded campaigns including music, film & video, art, publishing, games and theater.


Kickstarter has a much more rigorous process for selecting projects for funding than other similar platforms. This means that the quality of projects listed is relatively superior as well. The website is positioned as a community for creative places and not a marketplace or an investment portal. The company pushed this belief through a blog post titled “Kickstarter is not a store.”

Though the website has successfully funded commercial products as well, it continues to put primary focus on the creative arts before anything else. Because of this, the people likely to fund these types of creative endeavors are also more active on Kickstarter than other platforms. The 13 categories in which products can be listed include art, dance, comics, design, film & video, fashion, food, games, music, publishing, photography, technology and theater.

A product can be considered for listing on Kickstarter if it fulfills the following criteria.

  • There must be a clear end product. This means funding cannot be requested for a store, a company or a cause.
  • The product must be within the thirteen listed categories
  • The producer must be based within the US, Canada, UK, Australia, New Zealand or Norway.
  • There can be no equity financing, no rewards offered that have not been produced by the creator, no funds for ecommerce, business or social networking focused websites or apps. A detailed listed of prohibited items can be found on the Kickstarter.
  • The product being listed should be available as a prototype and not just a conceptual rendering.
  • There must be a production plan, an estimated timeline and a show of progress through photos, videos or drawings.


As with any platform, there are pros and cons associated with choosing Kickstarter. Some of these are listed below:


  • The biggest benefit of using Kickstarter is that its focus on the arts means that there is an active community of members and potential backers who are interested in creative projects and products. Pitching to the right audience means more potential funds generated quicker.
  • The fee is only charged if the project manages to raise its full target funding. If the goal is not reached then no fee is charged.
  • There is a 44% success rate for full project funding which is a promising figure.
  • The review process in the beginning is valuable as it may help modify a project for a successful pitch.
  • There is no equity funding, so the creator retains complete ownership of their endeavor.
  • The interface is intuitive and appealing, easy to navigate, and there are tools, tutorials and stats available to members.


  • With the increasing popularity of crowdfunding, it is becoming more difficult to gain attention once a campaign is created on Kickstarter or any other platform for that matter.
  • The site fees on completing the funding goals can eat into profits, especially for smaller businesses. If rewards are offered, then their disbursement also presents some logistical and scheduling issues.
  • Unless 100percent of the goal is reached, the money cannot be received by the creator. This causes uncertainty and lost opportunity for some.
  • There is a danger of running into scams or projects with little creative value. Such projects can discourage backers from pledging on other projects.


All funding for Kickstarter is all-or-nothing. This means that unless the listed project completes its funding target, no money is received. This may sound harsh, but essentially it serves to protect both the creator and the backer. The creator is not stuck with half the funding and the expectation to complete the project as per targets. Also, when a project is coming to life, people are more motivated to spread the word to help reach the target. As it happens, of the projects that reach 20 percent of their funding goals, 81 percent are successful in reaching the full target. While of those that reach 60 percent of their target as many as 98 percent reach the goal. This shows that either projects have the support that they need, or there is no support at all. There is hardly any inbetween.

The website charges a 5 percent fee on projects that reach their target funding amounts. The payments are made through Amazon, which charges an extra 3 to 5 percent credit card processing fee of its own. Unlike some other crowdfunding platforms, Kickstarter does not charge a fee on unsuccessful projects and campaigns.


  • Know the Guidelines – The biggest key to setting up a successful campaign is to understand the relatively strict guidelines that Kickstarter sets out. Backers should be able to clearly understand the goals and expectations of the project. In addition, no causes or general business projects can be listed.
  • Offer Rewards – Though equity funding is not allowed on Kickstarter, small rewards are necessary to attract backers. Rewards must be created by the campaign owner and are most popular when related to the campaign itself. The more creative and one of a kind a rewards, the more attractive it may be to backers.
  • Tell a Compelling Story – An interesting story can be the key that draws people to one campaign over the other. When backers feel connected to creators, they may feel more invested in the idea.
  • Split Funding Into Stages – If a project can be divided into distinct stages for development, then it may be a good idea to also split the funding into stages. This may make the funding targets easier to reach.
  • Set Realistic Funding Goals and Deadlines – Campaigns have a targeted dollar amount as well as a time limit. The time limit is anywhere from between 1 to 90 days. Funding may not be received until the full 90 days have passed. Similarly, the dollar amount for the project must also be realistic. An amount too high may not be reachable while one too low may not encourage backers that the project will be completed as stated. A 30 day campaign is usually ideal as a longer one does not necessarily mean more donors.
  • Make a Video – A good quality video introducing the project and its creators as well as answering potential questions and concerns is a good way to engage backers and create interest.
  • Show a Budget – It may be a good idea to show a basic budget so that backers know that you have your finances planned out.
  • Create a Buzz – Many smaller projects end up being funded by people who the creator knows. This means that it is a good idea to reach out to family, friends, relatives, coworkers and other communities to create interest in the project. This will help draw in donations as soon as the funding window opens up.
  • Send Personal Messages – Rather than spamming an entire contact list, it is a better idea to create similar subgroups and send tailored messages to these. This will help address people in ways that are most likely to appeal to them.
  • Follow up Personally – In a logical next step to customized messages, follow-ups with potential strong backers should also be tailored with aspects of the project that are likely to appeal to a group of people.

Mistakes to Avoid

A great idea can be held back by a badly managed and presented campaign on Kickstarter. Some common mistakes to avoid include:

  • Lack of Clarity – There is always a chance that the idea is well thought out in a creator’s mind, but is not communicated in the same way to potential backers. The way to avoid this is to write out a clear description with all images and videos attached and show some people as a trial. Note any feedback and incorporate changes.
  • Lack of Clear Call to Action – At the end of all communication, be specific and ask people for the help that is needed.
  • Lack of Effort to be Seen – The discover tab on Kickstarter has some select categories and not all projects are listed by default. There is no consistent way to be featured within these categories. To counter this, it is necessary to start communicating and creating interest via social media and online communities. The initial push will come out at the front of Kickstarter.
  • Too Much Focus on One Person – Though people want to connect with the faces behind a campaign, a balance needs to be struck between being likable and being pushy. A good idea is to speak about how backers will be able to benefit from the product in question and address any concerns that they may have. Allow people to get in touch and respond quickly when they do.
  • Too Much Extra Information – Keep all communication, information and updates quick and crisp. The audience needs to be engaged immediately and kept engaged till the end of the message is reached. Top earning Kickstarter videos average in length to about 3 minutes 57 seconds.


Most Funded Projects

Some of the projects that rased most funding on Kickstarter include:

  • The Coolest Cooler: This is at present, the highest funded project on Kickstarter as of August 2014. 62,642 backers pledged $13, 285, 226, well over the goal set at $50,000. The project was listed by Ryan Grepper of Oregan, USA. According to the brief, the cooler is “a portable party disguised as a cooler.” The product offers a way to mix blended drinks, play music and charge electronic devices through one cooler. Rewards offered included a range of items from a cup and rink mixing guide to a cooler itself or higher bids. The campaign materials include photos and videos of the prototype in use.

  • Pebble E-paper Watch: The second highest project to receive funding on Kickstarter, Pebble completed its funding round in May 2012. 68,929 backers pledged $10,266,845 to the campaign. The pebble is a smartwatch with a customizable interface. The rewards offered were the watch itself with different levels for different pledged amounts. The campaign included detailed specs and photos of the prototype in use.

  • Ouya Video Game Console: Successfully funded in August 2012, the project received a pledged amount of $8,596,474 from over 63000 backers. The console was designed on the android platform for TV. Rewards included developer specials, a trip to San Francisco to meet the team and an engraved console.

  • Pono Music: Funded successfully in April 2014, Pono received $6,225,354 of its $800,000 goal from 18,200 backers. Pono is a music device that offers a better listening experience. Backers were offered rewards that included a membership to the founders club with giveaways, a signed Neil Young poster, and the first edition player.

  • The Veronica Mars Movie Project: Funded successfully in April 2013, the project received $5,702,153, much over its goal of $2,000,000. 91,585 backers contributed. The project was listed by the creator of the franchise Rob Thomas. Rewards included a PDF document of the shooting script on the movie release day, limited edition t-shirts and regular updates and behind the scenes stories. Top pledgers were also offered the chance for the star and director of the movie to follow them on twitter for a year. The film was released in 2014.

Celebrities on Kickstarter

Often celebrities turn to crowdfunding to make their projects a reality. The most popular celebrity Kickstarter campaigns include:

  • PonoMusic by Neil Young – Mentioned, this campaign was among the top five most popular ever on Kickstarter.
  • The Veronica Mars Movie by Kristen Bell and Rob Thomas – Again among the top five, this movie campaign was successfully completed by the director and title character actor.
  • Wish I was Here by Zach Braff – Actor and director successfully raised funds for his movie in 2013. His project is among the top 15 most successful on Kickstarter.

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