Kickstarter is a crowdfunding platform that allows ordinary people to raise funds for the product development cycle and make their product ideas become a reality. Product development can be a daunting process, so having a space to communicate directly with supporters of your product idea can be valuable for defining your market.

We have experience raising funds for products both on and offline, with our most recent Kickstarter campaign becoming fully-funded in 2 days and reaching 300% funding after 30 days. To read more about the personal experience of Bang Creations using Kickstarter, click here. 

Using a crowdfunding platform allows you to gauge demand before making large commitments and investments. Instead of losing valuable business equity to angel investors or costly loans, smaller incentives can be offered to backers.

Below, we give our insights and answer our most frequently asked questions about crowdfunding to help you answer the question 'should I crowdfund for my product development?'

1) How successful are product crowdfunding campaigns?

It is easy to get the impression that all crowdfunding campaigns are successful. However, this is not the case. Depending on which platform is used, between 69%-89% of projects do not reach their targets. 

If a product idea fails to meet its funding target, it is not necessarily a reflection of a poor idea, lack of market or bad campaign management. Failing to become fully-funded is often as a result of inaccurate cash flow forecasting. Therefore it is vital to get the costings right before launching your campaign.

2) How much money should I ask for on Kickstarter? 

Crowdfunding goals should be set at your Least Viable Goal (LVG). While it may seem sensible to set an optimistic goal, if you are using Kickstarter, you will not see a penny if you do not reach it. Also, the sites do charge small percentage fees, which add up quickly when raising money past what is necessary.

3) Do crowdfunding sites charge a fee?

All crowdfunding sites charge a fee for the use of their platform, with the rates varying slightly. Kickstarter and Indiegogo both charge a 5% fundraiser fee and a 3% processing fee. However, Kickstarter offers discounts for pledges under $10, so it is worth exploring which platform is best for you.

4) How do I choose a crowdfunding platform?

The two main players for crowdfunding for product design and development are Kickstarter and Indiegogo. Aside from the marginal differences in fees, there are a few key differences in how campaigns are managed. 

a) Will my project definitely be accepted on Kickstarter?

Kickstarter accepts around 80% of the projects that apply, whereas any project can be posted on Indiegogo, if it is within their community guidelines.

To launch a campaign on Kickstarter, you must have a functional prototype of your product. However, on Indiegogo, it is only required that you have a non-working appearance product prototype. This is important to bear in mind depending on how far into the product development process you are and how much it will cost to produce a prototype.

b) When will I receive my money from Kickstarter?

This is arguably the key difference between the two platforms. Kickstarter will only release funds if, and when, a campaign hits its target (and by the deadline.) This gives backers an extra level of security because if a campaign fails, they will not be charged and so can support projects relatively risk-free.

Indiegogo, on the other hand, charges backers' cards immediately. Because of this, it is vital to consider your campaign launch date and be mindful of people's expenditure. For instance, try to avoid launching directly before payday or Christmas. 

c) Can I launch a crowdfunding campaign from any country?

It is only possible to run a campaign on Kickstarter from 23 countries, so it is important to read their policy carefully before planning your campaign. 

Indiegogo takes payment through PayPal and as such, supports campaigns from any country supported by PayPal. This means that there are over 200 countries that an Indiegogo campaign can be run from.

While there are restrictions on running campaigns, backers can support campaigns from any country, providing they have a major debit/credit card and a fixed address.

d) How long does a crowdfunding campaign last?

Kickstarter allows campaigns to run for 60 days but campaigns that run for 30 days or less have the highest success rates. This is because campaigns tend to peak at the beginning and end, so too much time in the middle is known as the "dead zone." Indiegogo allows campaigns to run for 120 days from launch.

5) How can I make my Kickstarter page stand out?

With thousands of projects to browse through, setting up an engaging campaign can be daunting. Marketing innovation and communicating a product's unique selling points (USPs) is difficult in an age of mindless scrolling. To read more about this in our 2020 Insights, click here. 

Invest thought, time and money into the visual content of your campaign. The hero image of your page must communicate in a glance exactly what your product does, so make it good. If your campaign is failing to gain traction, try changing the hero image, reducing the text and the length of your video.

6) Do I need to have a video on Kickstarter?

It is not a requirement of campaigns to feature a video, but it will work against you if you don't have one. Across all categories on Kickstarter, campaigns with a video had 120% greater success with funding. For the product design category, this rose to 200%. 

7) What do backers get from Kickstarter?

As well as gaining exclusive insight into the development process, backers gain rewards from supporting campaigns. It is a great way to engage with your community and make them feel valued. 

During our Kickstarter campaign for BoB glasses case, we sent our backers an exclusive glasses cloth. The most popular amount pledged by backers is $25, so a small token to show them your appreciation will keep them, and your finances, happy.

More questions about whether crowdfunding is right for you? 

Here at Bang Creations, we take ideas and design, develop and deliver them to market. If you have any questions about crowdfunding and whether it is the right path for you, then please get in touch. We support businesses, inventors and innovators throughout the development process and are always happy to help.

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