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Crowdfunding Site: Kickstarter

Updated on March 29, 2015

How Kickstarter Works

UPDATE: Kickstarter has added a new feature for an owner of a successful funded project. The new feature called “Spotlight” let's an owner have their very own homepage to showcase the funded project. The owner will be able to customize the home page with features such as links to the company website, a way to see other items the owner might sell, descriptions, buttons and a linear timeline of the project. This extra exposure not only benefits the project owner but potential buyers also. This gives buyers an easier way to view the project progression and see other projects that been fully funded.

I will discuss the technology part of Kickstarter; however there are many areas that you can back a project such as films, music and books. The Kickstarter site enables people to discover and back as many projects as they believe will become a reality. When a person or groups of people decide to start a project on Kickstarter they must first build a project page, which includes a video with description explaining their project. The next step for project owners is to provide information about their budget and a timeline from beginning to end of the project. The project owners then must decide what kind of rewards they will be offering such as a choice of item color or engraving the item with the project name and year. The rewards are given when the project funding reaches certain milestones. Project owners have to keep in mind that they pay for all offered rewards to backers. When project owners think about the funds necessary to bring their project to fruition they must consider everything because Kickstarter will not let their project become a reality if the funding goal is not met. A very important part of the project is promotion. A project needs active promotion because a project no one knows about will never get funded. Kickstarter’s fee is 5% with an additional 3 to 5% for processing payments. If they don’t meet their funding goal they owe nothing.

Kickstarter Backers

There are different tier amounts that a backer can pledge. When a backers pledges early there is usually a perk from the project owner as a way of thanking backers for coming aboard early. The different pledge tiers not only tell you the item but an estimated month and year for that group of backers to receive the item. The shipping information will also be listed in each tier box along with any accessories that might be given. The project owner once he/she has met the project funding level will give their backers updates as the project develops through each stage. Backers like to know they’ve made a wise decision in backing a projects and hate when shipping has to be pushed back time after time. My experience with Kickstarter is that projects are always pushed back for different reasons. The project owners try to give realistic shipping estimates but a project of this magnitude is new to many of them and they are not prepared for the problems that arise. You the backer have to be aware that there are scam artist that will go through the motions of creating a project but once funding is met and they receive their money you never hear from them again. There is really no recourse for backers when a project owner takes the money and doesn’t fulfill his part of the deal. There are a lot of backers that have gotten burned and now wait until the item is in a retail store. The difference between getting an item from Kickstarter and waiting to purchase at a retail store is usually not that great of an amount. Kickstarter backing is partially about being first to get an item that no one might know about and understanding the ease it can bring to everyday life.

Kickstarter History

Kickstarter was started Apr 2009 by Perry Chen, Yancey Strickler and Charles Adler. The Kickstarter headquarters is located in New York City. Kickstarter uses Amazon payments as one source to collect pledge money. Kickstarter and Indiegogo are both very user friendly sites for the project owner and backer. Kickstarter responds to questions and problems about their site very quickly and you can respond to the project owner by clicking on the comments section or emailing him/her through the website. The comments area is also a place to interact not only with the project owner but with other backers during the course of the project. This were backers vent their frustration when a project is late

The Dash
The Dash
CST-01 The Thinnest Watch
CST-01 The Thinnest Watch

Backed Kicstarter Projects

The Dash is one of the projects I have backed on Kickstarter. The Dash is completely wireless headphones. When you put them in your ear most people will probably think it’s a hearing aid of some kind. The wire or leash as it’s called is optional to be used when exercising. The Dash gives you steps, heart rate and has music storage so you won’t need your smartphone to listen to music. I’ve also backed what’s supposed to be the thinnest watch around. I was supposed to receive this item 2 years ago with the last update from the project owner being in February. You take chances backing projects and the outcome is not always good. If you ever decide to back a project just make sure you can afford the lost because there’s no guarantee that you will get what you are paying for.

Kickstarter Update.: Kickstarter is hiring an integrity Specialist to review design and technology submissions, perform detail assessment of submitted projects and moderate their site. Kickstarter is hoping this will cut down on scams and give backers some relief in knowing that a third part has approved the project and will monitor it.

How Do You Feel About Backing Projects

Would you take a chance and back a kickstarter project?

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