What is Kickstarter and How it Works | Tech-Knowledge

What is kickstarter?

Kickstarter is a crowdfunding platform that helps creators raise money to bring their projects to life. It’s especially popular for creative endeavours like:

• Tech gadgets

• Board games

• Films and documentaries

• Art and design projects

• Books and comics

• Music albums

  
  

How it works?

1. Creators launch a campaign with a funding goal and a deadline.

2. They offer rewards to backers (like early access, exclusive items, or shout-outs).

3. Backers pledge money to support the project.

4. If the campaign reaches its goal by the deadline, the creator gets the funds. If not, no money is collected (this is called an all-or-nothing model).

Kickstarter is not a store—backers are supporting ideas, not buying finished products. There’s always some risk involved, but it’s also a way to be part of something from the ground up.

What is Kickstarter and how it works

Example of a few successful projects:

Here are some of the most successful Kickstarter projects of all time, based on total funds raised and cultural impact:

Surprise! Four Secret Novels by Brandon Sanderson

• Funds Raised: $41.75 million

• Backers: Over 185,000

• Category: Publishing

• Why it succeeded: Brandon Sanderson, a bestselling fantasy author, surprised fans with four secret novels. His massive fanbase and reputation for delivering quality work helped this campaign become the most funded in Kickstarter history.

  
  

Pebble Time Smartwatch

• Funds Raised: $20.3 million

• Backers: 78,471

• Category: Technology

• Why it succeeded: Offered a sleek, customisable smartwatch with long battery life before Apple Watch dominated the market.

  
  

Coolest Cooler

• Funds Raised: $13.3 million

• Backers: 62,642

• Category: Design

• Why it succeeded: A high-tech cooler with a blender, Bluetooth speaker, and USB charger. It was a viral hit, though fulfilment issues later hurt its reputation.

  
  

Kingdom Death: Monster 1.5

• Funds Raised: $12.4 million

• Backers: 19,264

• Category: Games

• Why it succeeded: A dark, detailed board game with high-quality miniatures and deep gameplay. It raised $1 million in just 19 minutes 

  
  

Critical Role: The Legend of Vox Machina

• Funds Raised: $11.4 million

• Backers: 88,887

• Category: Film & Video

• Why it succeeded: Fans of the Critical Role D&D show rallied to fund an animated special, which later became a full Amazon Prime series.

  
  

Baubax Travel Jacket

• Funds Raised: $9.2 million

• Backers: ~45,000

• Category: Fashion

• Why it succeeded: Marketed as the ultimate travel jacket with 15+ features, including a neck pillow, eye mask, and tech pockets. 

  
  

Exploding Kittens

• Funds Raised: $8.8 million

• Backers: 219,382

• Category: Games

• Why it succeeded: A quirky, humorous card game co-created by The Oatmeal. It became the fastest-funded Kickstarter project at the time.

The Most Successful Kickstarter Campaigns and Why They Worked

What are the risks of crowdfunding?

Crowdfunding can be a powerful way to bring ideas to life, but it also comes with several risks—both for creators and backers. Here's a breakdown:

 For Backers (Supporters)

1. No Guarantee of Delivery: Projects may fail to deliver the promised product or service, even if fully funded.

2. Delays: Many campaigns miss their estimated delivery dates, sometimes by months or even years.

3. Quality Issues: The final product may not meet expectations or match the prototype shown during the campaign.

4. Scams or Mismanagement: Some campaigns may be fraudulent or run by inexperienced teams who can't manage production.

5. No Refunds: Kickstarter and similar platforms typically don’t offer refunds. Backing is not the same as buying.

 

For Creators

1. Underestimating Costs: Creators often miscalculate production, shipping, or tax costs, leading to financial strain.

2. Overwhelming Demand: A campaign that goes viral can create logistical nightmares if the team isn’t prepared to scale.

3. Reputation Damage: Failing to deliver or communicate transparently can harm a creator’s reputation long-term.

4. Legal and Tax Issues: Crowdfunding income may be taxable, and creators must comply with consumer protection laws.

5. Intellectual Property Risks: Sharing ideas publicly can expose creators to copycats or IP theft if not properly protected.

Read this article by All Business which dives into the legal and tax implications of crowdfunding, especially for startups and small businesses. It also offers practical advice on forming a business structure before launching a campaign.

Risk and Benefit of Crowdfunding

I have tried to list out the risks and benefits of crowdfunding in the table below. You can find more details on Kickstarted website as well.

Risk and Benefit of Crowdfunding

Risks of Crowdfunding	Benefits of Crowdfunding
No Guarantee of Delivery	Access to Capital
Delays	Market Validation
Quality Issues	Community Building
Scams or Mismanagement	Marketing and Exposure
No Refunds	Feedback and Improvement
Underestimating Costs
Overwhelming Demand
Reputation Damage
Legal and Tax Issues
Intellectual Property Risks

Find a comprehensive breakdown of the advantages and disadvantages of using Kickstarter, including insights into platform features, funding models, and campaign strategy described by Jack Berning on CrowdCrux

How to Apply on Kickstarter?

Create an Account

• Create an account on the chosen crowdfunding platform.

• Provide your email address and create a secure password.

• Confirm your identity through a verification process.

• Access your dashboard to manage projects, track progress, and communicate with potential backers.

• Take your time to ensure all information is accurate.

Your step-by-step guide to making sure your Kickstarter campaign is totally ready before you hit launch.

Develop Your Project Idea

• Develop your project idea thoroughly before launching your campaign.

• Brainstorm and refine your concept to ensure it is unique and has a clear value proposition.

• Conduct market research to understand your target audience and their needs.

• Consider what makes your project stand out from others in the same space.

• Create a mission statement or an elevator pitch that succinctly encapsulates your project’s purpose and goals.

• This clarity will guide you through the rest of the campaign process.

Prepare a Campaign Page

• Your campaign page is the first impression potential backers will have of your project.

• Make it visually appealing and professional.

• Include a compelling title, engaging images, and a well-crafted video.

• Clearly outline what your project is, why it matters, and how funds will be used.

• Include a detailed budget breakdown and a timeline of project milestones.

Set a Funding Goal and Deadline

• Determine a realistic funding goal by analysing your project’s needs and calculating the minimum amount required.

• Set a deadline to create a sense of urgency and encourage potential backers to contribute sooner.

• Consider the length of your campaign, balancing the need for urgency with the desire for visibility and engagement.

How to Set the Right Funding Goal for Your Kickstarter Campaign

Launch Your Campaign

• Once everything is in place, launch your campaign.

• This moment can be exciting and nerve-wracking.

• Have a launch plan in place.

• Notify your current network through emails, social media posts, and other communication channels.

• A successful launch can set the tone for your campaign.

• Consider offering early bird rewards or special incentives for the first backers to encourage immediate support.

Promote Your Campaign

• Promotion is an ongoing effort throughout your campaign.

• Use various marketing strategies to reach your target audience.

• This can include social media marketing, email campaigns, and engaging with relevant online communities or forums.

• Collaborate with influencers or bloggers who align with your project’s mission to expand your reach.

• Provide regular updates on your campaign’s progress to keep backers informed and engaged.

• This can motivate them to share your project with their networks.

Discover the art of storytelling to transform your crowdfunding campaign into a magnetic, community-driven journey that inspires backers to act.

Engage with Backers

• Building a relationship with backers is vital for sustaining momentum during a campaign.

• Respond to comments and messages promptly, thanking backers for their support and addressing any questions they may have.

• Host live Q&A sessions or updates to foster a sense of community.

• Engaging with backers helps maintain interest in the campaign and encourages them to spread the word, which can lead to additional funding.

Fulfil Rewards

• After a successful campaign, fulfil the rewards promised to backers.

• Handle this process with care and attention to detail, reflecting your commitment to supporters.

• Create a fulfilment plan outlining how and when rewards will be delivered.

• Communicate transparently with backers about any delays or issues.

• Providing a positive experience can lead to lasting relationships and support for future projects.

FAQ:

What is Kickstarter?

Kickstarter is a crowdfunding platform that helps creators raise money to bring their projects to life.

How does Kickstarter work?

Creators launch a campaign with a funding goal and a deadline. Backers pledge money to support the project. If the campaign reaches its goal by the deadline, the creator gets the funds. If not, no money is collected.

What are the risks of backing a Kickstarter project?

Risks include no guarantee of delivery, delays, quality issues, scams or mismanagement, and no refunds.

What are the benefits of crowdfunding on Kickstarter?

Benefits include access to capital, market validation, community building, marketing and exposure, and feedback and improvement.

How can I apply to launch a project on Kickstarter?

Create an account, develop your project idea, prepare a campaign page, set a funding goal and deadline, launch your campaign, promote it, engage with backers, and fulfil rewards.