Crowd Sourced Fundraising: Kickstarter vs Indiegogo

I recently became aware of the crowd sourcing platform "Indiegogo" and, as the survivor of a successful Kickstarter campaign (Kenosha Festival of Cartooning), I thought I would share a little of my experience with that platform and why I might consider using Indiegogo for my next project.

Kickstarter - Pros:

1) Kickstarter currently has much higher name recognition than Indiegogo. Name recognition will not help you very much in terms of actual dollars pledged via the kickstarter site itself but it helps enormously when you are trying to spread the word that you are crowd sourcing a project. I personally did not get much funding from casual Kickstarter browsers. But tying the project to Kickstarter did help the project get coverage on other online news sites and blogs.

2) Kickstarter has rules for its projects and funding that gives backers the impression that the project has been vetted. This probably allows backers to support projects with confidence that they are not being scammed in some way.

3) Getting my Kickstarter project approved was a little nerve wracking but, once the process was underway, the site was very easy to understand and work with.

Kickstarter - Cons:

1) Kickstarter offers only "fixed funding" which means that, if you don't 100% make your goal, you get NOTHING. Nada. When I would tell people this, they were often surprised and thought it was stupid.

I can only feel that Kickstarter sticks with this model because they feel that it creates a sense of urgency among backers that makes them more active supporters. More active supporters are more likely to raise their pledge if they feel the project is in jeopardy and also twist the arms of their friends to become backers as well.

Believe me, if you don't have active backers who REALLY, REALLY want to see your project succeed, it won't.

2) Kickstarter ONLY accepts donations via Amazonpayments. This was a nightmare for me. First, there was no mechanism for me to set up the campaign as a non- profit - which mine was - and, secondly, it took over a WEEK to get the account set up properly. There was always some button I hadn't clicked properly or some other mysterious problem on their end. And the problems were not quickly or easily resolved.

Another problem with Amazon payments is that a lot of my potential backers did not have Amazon accounts and did not want to create them just to donate to my project. So they would offer me a check or some other way to pay instead, assuming I could just put that money into the project account myself.

Except that you can't do that. Amazon payments has a STRICT policy that no one can "pay themselves" to fund a project. Even if the money comes from a genuine backer via a personal check, you CANNOT pay it to the Kickstarter project. If you do attempt to "pay yourself" in this way, Kickstarter will cancel your project and blacklist you.

Indiegogo - Pros and Cons

I'll be honest, I haven't attempted a project on Indiegogo yet but I have poked around the site as well as made a donation to a project and here's what I found.

1) Payments you can use - this is a HUGE difference - credit card or paypal. I honestly don't know ANYONE who does not have a credit card or a paypal account. Being able to accept these methods of payment would have made a difference to my project of at least $600 - maybe more. I'll never really know how many potential donations I lost when backers got to the payment phase, got frustrated, and decided to skip donating.

2) Flexible Funding - again HUGE. For a project like mine, the Kenosha Festival of Cartooning, where I was just trying to raise as much money for the festival as I could, I would much rather have been able to keep what I raised, no matter how much it was. WARNING - on Indiegogo, the fees for a flexible campaign that does not reach its goal are much higher. 9% vs 4%

These two differences alone make me want to try Indiegogo next time I crowd fund a project.

OVRERALL CAUTIONS FOR CROWD SOURCED FUNDRAISING

Both these platforms take a significant fee for helping you fund your project. Between the Kickstarter fees and the Amazon Payments fees, I lost about $1300 of the total "$13,600" I raised. It does not look as though Indiegogo is any cheaper. Be sure to factor these fees in when you set your target goal.

DON"T attempt to crowd source a project without social networking and other types of publicity!!!! The three most important ingredients in my success with the Kenosha Festival of Cartooning were 1) Facebook 2) Twitter 3) News blogs like The Daily Cartoonist and 4) The Tall Tale Radio Podcast interview I did. My biggest donor, The National Cartoonist Society Foundation, would not have been aware of my project or that it was a good fit for their mission without that interview.

15 comments:

  1. This was some great insight. I plan on funding my comic strip's book next year. My big drawback is that I do not have a big following... yet.

    Thanks for the info!!!!

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  2. Thanks - sounds like I'll probably try Indie gogo

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  3. Thanks--I'll avoid Kickstarter now! Btw Kerri Smith just passed her fundraising goal on Indiegogo...more about her "Bellyrest" pillows there, some at my Blogspot.

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  4. I'm about to launch a project on Kickstarter, so this article was of great interest to me. I'm also a backer of the Kenosha Festival of Cartooning so of course I'm interested in Annie's perspectives on the process.

    I'm fine with the "all or nothing" approach that KS takes. I'm going to try to raise $8,000. If I only got $2,000 it would be difficult to complete my project, and with the fees and rewards, getting less than my target would just complicate things!

    In addition, of all the people I've told about this, and I've told a LOT of people, NOT ONE has ever heard of KS, which really surprises me as they've actually been getting a lot of press the last several months. So no one in my experience had any opinion at all on the "all or nothing" philosophy.

    As for people who *want* to help but don't have an Amazon account, still puzzling over that one, but those people also are A)unlikely to have a PayPal account, and/or B)not online shoppers, or are generally leery of using their credit cards on the internet. But until someone tries to contribute and can't, it's academic. I guess we'll see!

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  5. Thank you so much! This was immensely useful.

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  6. Hi Anne: very useful! many thanks
    Lucho Osorio

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  7. I don't know very many people with an Amazon acct. In fact, I only know 2. But I don't know anyone without a paypal acct. I didn't have an Amazon acct and it was a nightmare getting one, only to be rejected by stupid Kickstarter for no apparent reason. Meanwhile, tyhey approved a video that features dancers doing the the Lindy, as filmed from beneath a glass floor. That's wayyy more imporetant than my instructional video on sustainable urban micro-agriculture. Yeah.

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  8. IndieGoGo, Kickstarter, and other crowd funding sites offer a convenient venue to folks who want others to help bring an idea to the marketplace. However, as is the case with most marketing services, using these sites yields no guarantee that lots of people will see and take note of the idea being presented. It is for this reason, together with the associated - reasonable - site fees, that Eon Puzzle is attempting the presentation task apart from established crowd funding venues. Can such go-it-alone attempts be successful? The history is still in the making.

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  9. Thanks for writing this!

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  10. Here's what Kickstarter says about all-or-nothing funding in their FAQ section:

    "Why is funding all-or-nothing?

    All-or-nothing funding is a core part of Kickstarter and it has a number of advantages:

    It's less risk for everyone. If you need $5,000, it's tough having $1,000 and a bunch of people expecting you to complete a $5,000 project.

    It motivates. If people want to see a project come to life, they're going to spread the word.

    It works. Of the projects that have reached 20% of their funding goal, 82% were successfully funded. Of the projects that have reached 60% of their funding goal, 98% were successfully funded. Projects either make their goal or find little support. There's little in-between.

    To date, an incredible 44% of projects have reached their funding goals."

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  11. Great article. thanks for the info. It's important for people starting campaigns to understand the difference between these to crowdfunding giants.

    I've thought about starting a campaign on one of these sites but just didn't know where to start.
    Indiegogo Vs. Kickstarter

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  12. One of the reasons we launched our fund raising campaign on Kickstarter was because of the "all or nothing" policy. We crunched our numbers and knew we needed $50K to make this happen. Less than that did us no good. We only launched a couple days ago and despite some strong support on FB and other channels, actual backers have been few and donations small. Still early days and we continue to get the word out. For any one interested here's the link: http://www.kickstarter.com/projects/1502738629/manifestation

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  13. Thank you so much for your blog post. I am currently researching crowdfunding solutions for 2 of our projects and your blog has been a great help. The point about publicity is very relevant. If you can share some more insights on it, I would greatly appreciate it. How did you approach FB, Twitter and blogs with your proposal. How often you "promoted" your project on those sites? What turned out the best timing / way to promote the project? If you had written about it in the past, I would appreciate a link. Thank you so much once again!

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  14. @ mashakubyshina

    So far Kickstarter is still new enough to be newsworthy which helps gain attention for a project. However, it is very unlikely that simply having a project on Kickstarter will gain your project a mention in the news without some help. I was lucky to know some people that report on the cartooning business and they plugged the project on their sites. You should look for websites that already have an audience interested in the sort of project you are doing and then call your project to their attention and hope that they endorse it.

    Regarding Facebook and Twitter, if you do not have accounts with them you will not be able to use those social networks to promote your project. Setting up an account for yourself and your project is free and easy. Once you have an account you need to build your list of friends and followers so that your posts about your project are actually going out to an audience. This can take some time so if you are not already on Facebook and Twitter you need to build this time into the timeline of your overall project.

    I hope this is helpful!

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  15. I'm going to start an undertaking on Kickstarter, so this article was of incredible investment to me. I'm additionally a sponsor of the Kenosha Festival of Cartooning so obviously I'm intrigued by Annie's views on the technique.

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