Everyone is talking about raising money on Kickstarter, and why not? Who wants VC money, where you have to give up equity and often control of your company?
But it’s not as easy as it looks to raise money on Kickstarter. There are certain types of projects that raise far more than others.
Here’s my analysis of what makes a good Kickstarter campaign:
1) Projects that are altruistic in nature tend to motivate people to give. This makes sense because people are giving for a cause they believe in.
2) Projects that make your jaw drop because they are so creative, unique and compelling.
3) Projects that feature a new product you really want to own and can’t get anywhere else do extremely well on Kickstarter. The key is that you can’t go to Wal-Mart or Amazon and buy one.
4) Projects that feature a product with a high perceived value. The higher the perceived value, the easier it is to raise a lot of money. You’ll notice that the products in the $20 – $200 range do very well, while 99 cent apps struggle to bring in much money. It’s simply math. If you have 1,000 people giving you $100, you’ve just raised $100,000.
5) Projects that are humorous. If you can make people smile, they just might be inclined to help you out — especially if you have a good video!
My husband, Steve Hoffman, just put up his Kickstarter Campaign. As you can see, he’s trying to raise money around a creative project called the Yumbies.
He’s gotten a lot of support, but it’s harder for him because his lead product is an iPhone app, and Apple won’t even let you distribute the app directly to users outside the App Store. Also, the app itself is a “freemium” product, so it doesn’t have an inherent value.
Despite these limitations, his campaign seems to be taking off — although it’s definitely a lot harder because out of the top 5 items I listed above, he only taps into #5.