Thinking about raising money on Kickstarter? Here is what you need to do before going live.
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Crowdfunding has become a go-to vehicle to raise funds for many creative projects. Currently, there are almost 4,000 live campaigns on Kickstarter (including 328 games) trying to raise $22 Million. The platform approves less than 50% of projects, and still the success rate is only 44%. For the games category it is even lower – less than 35%. While the games category has the largest number of $1 million+ campaigns, only 19% of all campaigns have raised more than $10,000.
So what determines if your project will be a success or failure? How can you increase your chances to reach and exceed the goal? The short answer is PREPARATION. Most campaigns fail even before they go live on a crowdfunding portal.
There are several decisions you have to make as early as possible.
- What platform do you want to post your project on? Kickstarter is not the only option. If you are new to crowdfunding and need support and personal relationships with the funding portal customer service, you may be better off with smaller platforms which have reasonable traffic, a track record of successful raises in your category and are transparent about their data. Another benefit is that they host a smaller number of projects, so you have a better chance to get featured in their newsletter or on a home page. The drawback is – they do have significantly lower traffic, a smaller number of serial backers and the average pledges are also lower. But you can use it as a learning experience and try to raise a small amount of cash (below $5,000) to bootstrap your operations.
- What are your target groups? The answer is not always as obvious as it seems to be. What are your goals beyond a crowdfunding campaign? Are you starting a business? Do you want to create new versions of the game later on? Are you looking for end users or distribution channels? Are you interested in global operations or just in selling nationally? Who can you partner with (like hardware – software)? Remember: crowdfunding is not just about money. Think about your non-financial goals. You can find beta-testers for your game, new team members, distributors, buzz creators, crowdsource the product development, and attract media attention.
- After you answer the previous questions, you can start creating your presentation and thinking about the perks that would potentially excite these groups. Be creative, think beyond t-shirts! But BE SMART: remember that your perks mean expenses. Do your math. There is a significant number of people who have succeeded in reaching their goals and ended up broke after fulfilling their obligations.
- Work on your budget. What is the absolute minimum you need to raise? Is it possible to crowdfund your project in several smaller steps? You will have much better chances if you establish your credibility through successful small projects than if you fail on a big one. Learn from Travis Worthington who started from a $1,500 campaign and now has raised more than $600,000 through eight Kickstarter projects. How much would it cost to create and run the campaign and what are the costs of production and delivery of your perks? Don’t forget about the platform and payment processor fees. Remember that not all pledges will go through.
- Build your team. What are your weaknesses? How can you compensate them? Do you know who the people are who can help you? What kinds of experts can you afford/do you need to hire? Educate yourself; build your toolbox to run the campaign efficiently. There are lots of free resources available online.
- Build your crowd. There is no such thing as too early when you are talking about connecting with potential supporters. Your first contact should not be about money. It is about building trust and finding something in common with others. Create accounts in social networks, join relevant groups, participate in discussions, create content that adds value, support others. There is no bigger mistake than having all kinds of accounts and spending all time talking about yourself. Even your friends will eventually get bored and leave you. Remember: social networks are not advertising billboards. Learn to listen and communicate with others. Find and connect with influencers. Educate yourself about analytical tools to audit the results of your actions. Make sure to get people committed to pledge during first three days of your campaign.
- Create marketing and PR plans. It should include online and offline actions, engagement on a daily basis with new people and communications with your established connections. Write content, tweets for every day of the campaign, build a newsletter subscription and plan weekly direct mail blasts, post YouTube videos and create Pinterest boards. But remember to build up interesting content for the whole duration of your campaign in advance instead of using everything before going live on a crowdfunding portal. Learn from similar projects; connect with journalists who’ve covered their campaigns in the media, offer “how to” and “top 10” types of articles instead of asking them to write about you. Contact local groups and offer to give presentations, write expert articles for community newsletters which are sent to your target auditory, participate in meetups, etc.
The most important thing to remember: crowdfunding is not a free and easy way to raise money. Get ready to work hard! Think of it as a pregnancy process. You should look for help and quality support, but nobody else can give birth to your baby for you. Good luck!