I’m sure you’ve seen it in your newsfeed - artists and small businesses asking for support of their Kickstarters or other crowdfunding projects. I have run 13 of them by now, most successfully funded way above their goals. I get lots of questions from followers about how it works, so figured I’d write an entry about it. Note, I only have experience with Kickstarter so this entry will focus on that platform.
Kickstarters are considered ‘crowdfunding’. Small businesses and independent artists can tap into the power of social media and the internet community at large to help bring products to their line up that they wouldn’t otherwise be able to. Often, product dreams outstrip actual budget, but these same products can help grow a business.
Business is always a gamble. An idea that an artist is super passionate about may or may not have equal passion with the customers. Crowdfunding is a great way since it’s fairly low risk as no money changes hands unless the product goal is met. It’s also great for followers to feel like they are coming together to help something come to life.
What’s a backer?
Backers are people like you who see a project and believe in it enough to pledge money towards its creation. Kickstarters often have set pledge levels where you can get various rewards based on the amount you pledge. Almost always, the rewards are items that the creator is trying to produce. It’s a great way to be the first to get the new product as well. Many creators will not release the product to the general public for sale until all backers items are out in the mail. Additionally, many projects have perks for becoming a backer like free shipping or a discount in the item.
If I become a backer, that means I need to pay now?
This is a common misunderstanding. Kickstarter is an all or nothing platform. You are promising to pay the amount you select if the funding goal is met. Kickstarter only takes money out at the end of the campaign if the funding goal is met. Granted, you should budget for the money to come out at the deadline, but don’t let the current budget determine if you can back or not, especially if there is a limited edition level that you want to lock in. Get your pledge in and just make sure you have the money at the deadline.
What if I change my mind as a backer and want to increase or decrease my pledge?
Backers can change their pledges throughout the live campaign. Sometimes, there will be additional products that get added on if funding is met early on and there’s still time. These are called ‘stretch goals’. If you initially back and then something additional opens up, you can adjust your pledge to add on the new item.
On the flip side, sometimes things come up in real life - bills, emergencies, a poorly timed car breakdown (is there even such thing as a good time for that?) - and you need to pull out. Creators totally understand that life happens. Remember, as long as the campaign is still live, you can cancel your pledge altogether.
I don’t think they are going to get to the item I want, I’m gonna drop out.
This is something that creators struggle with in campaigns. Nothing is set in stone until the close of the campaign. I can’t tell you how many times I can tell backers are giving up hope and start dropping out. I’ll be X amount away from 100%, but backers start to get pessimistic and give up and suddenly, what was capable of funding is starting to look pretty out of reach when people drop pledges. If it’s not a financial reason for dropping or decreasing, please stick with the project! It can mean the difference between a successful funding or a failed project.
Once again, no money comes out til the very end if things hit 100%!
I’m still not sure if I’ll have the money when it comes time to pay.
I totally understand this. Many campaigns run for 15-30 days. It can be hard to project that far out in advance. Kickstarter has a ‘remind me’ button that you can click on campaigns. It will send you a notification when the project is 48 hours from ending. I’ve used this before on other projects I’ve backed. It’s great!
I could just wait until it’s in the general shop, right?
Not always! So many times, I get comments of ‘I’ll totally get this when it’s in the shop’. Don’t take that chance. Many small business owners rely on the funds raised in a Kickstarter to create the product you see advertised. If people are holding out for it to show up in the shop, you run the risk of it not funding at all which means there will be no ‘next time’.
I really want to help, but I can’t afford to at this time. Is there something else I can do?
YES! Share the projects you love on social media. Tell your friends the good, old fashioned way by word of mouth. Not all of us have giant advertising budgets and social media relies on shares to get things out there. Sharing, liking, reblogging, tweeting, etc can be just as helpful as a pledge.
Hopefully, this helps answer some questions about Kickstarters and how it works for backers. Now, go out and find some dreams to contribute to! We small business owners are totally grateful that you believe enough in our projects to help us bring them to life.
