In the past five years, Kickstarter has emerged as a legitimate source of funding for startups and entrepreneurs. While banks or traditional investors are likely going to want to see proof that there will be a large, worthwhile return on their investment (sales or letters of intent) Kickstarter is a place for people with great ideas that may not fit conventional funding models.
“Anyone can go on (Kickstarter) with an idea and the right strategy, and raise money, which is a beautiful thing,” Justin Herd said.
Herd worked as a Kickstarter consultant after he ran a successful campaign in 2014, raising a total of $58,463 dollars from backers in 33 different countries for his product, The OneBowl. Herd had already raised $20,000 for The OneBowl on the pitch competition circuit, and he was looking at needing at least $50,000 to start manufacturing.
“The first time I heard ‘Kickstarter,’ I kind of shrugged it off,” Herd said. “Then I looked into it and saw that there are people all over the world, like me, with an idea that has merit, and they just need to raise funds to do it.”
Kickstarter not only gives you access to debt free funds, but also the opportunity to create a community around your idea by having a platform that allows you to interact in real time with your backers. You can create levels of donations, with each level coming with its own reward to the backer. Whether it be a free product or behind the scenes updates, this allows backers to be a part of what you are doing.
You need not already have a strong online presence to have a successful Kickstarter campaign. However, there are steps you can take in the 3-6 months before you launch that will help determine your success.
What to do before you launch…
You should be committed to your idea and ready to take the next step if in fact your campaign achieves full funding. To get a feel for how legitimate your idea is, talk to people. If they are interested in what you want to do, chances are others will be to. Utilize resources like community business centers, idea pitch competitions and local universities to figure what you need to make it happen and pinpoint a funding goal.
2. Make a Kickstarter page before you launch
Kickstarter allows you to create and promote a page for your product before you launch, which creates anticipation. Describe what you are doing in words and make a video to accompany it. Kickstarter campaigns that feature videos are more successful than those that don’t. Also, do your best to get professional looking photos, as they will convey a level of legitimacy to potential backers.
3. Reach out to your family and friends
Utilize your base and reach out to your family and friends in whatever way you can. Spread the word on Facebook–a personal approach will garner a response. Do the leg work and write individuals messages to everyone. Share what you are doing! Ask for support and you will probably get it, whether it be in the form of dollars or simply spreading the word.
“People respond well to that. People want to help other people and it takes only a couple minutes of your time,” said Herd.
From reaching out this way to 300 of his Facebook friends, Herd was able to reach 10,000 people.
4. Reach out to online publications
Spend 1-3 months prior to your launch reaching out to journalists who write about the sort of thing that you are aiming to do. Publicity is a huge factor in the success of your campaign and all it takes is an email. Blogs like Spicy Tech, Life Edited, In Stash, Pickstarter, Ayudos and Crowdfunding Insider are in the business of informing readers about worthwhile crowdfunding campaigns. An article on one of these blogs will reach readers who are on the look out for neat ideas to put their dollars behind.
Once you launch…
1. Get on the front page of Kickstarter and stay there
Like Google, Kickstarter uses an algorithm to determine what is put on the website’s front page. There are many articles about how to use this to your advantage, but if data and metrics are not your thing, you can hire someone to do this for you. Another way that will skyrocket our project to the top of the pile is to have a large number of backers on the first day. Backers per day is used to determine what is front page worthy. Having 80 backers on day one equals 80 backers per day. Having 80 backers on day 10 equals 8 backers a day. This is where doing the leg work leading up to your launch date will pay off. Once you get on the front page, whether it be through utilizing data or encouraging backers to jump in one day one, you will likely stay there, as anyone visiting the site will be prompted to check out your project.
2. Do something for your campaign every day
Even if you take all of the steps above, you will not be able to just put your feet up and watch the money flow in. You need to stay active in your campaign every day. Post updates at the end of each day, make a brief “thank you” video in the middle of your campaign, and answer every question and comment from your backers. This will drive your momentum through until the end. That being said, make sure that you have the time to do this.
“For someone who is constrained on time,” Herd said. “That is going to be a huge challenge.”
Herd had just graduated from GVSU when he launched his Kickstarter and was able to dedicate almost all of his time to his campaign.
So your Kickstarter campaign was a huge success. What now?
“Then you have to think about, ‘now I have to ship 10,000 products.’ There is a cost to ship every piece of product. (Then there is) manufacturing and production…” Herd said. “A challenge of Kickstarter is being ready for that success.”
Again, utilize the resources in your community–business centers, incubators and entrepreneur programs–especially if this is your first go round in starting a business. Your backers put money toward your idea in good faith. Keep them updated and be transparent, even if you hit a few bumps in the road.