Looking to raise funds for film or video projects? If so you may be interested in checking out the big data analysis presented by Krowdster (2014) that reviews the patterns of success among other projects that went before yours. Data collected by Krowdster was taken from almost 500,000 crowdfunding campaigns. The campaigns were identified on a range of different crowdfunding platforms including Kickstarter, Indiegogo, Tubestart, RocketHub and Pozible. By understanding how others have achieved success you can give your own campaign the best possible chances of success.
Starting with overall success rate, projects achieved a 58% success rate using a platform named Pozible, which is an Australian platform. Projects with campaigns launched on Kickstarter had the second highest likelihood of success, with 41% of projects achieving a successful outcome. Tubestart, a platform specifically targeting the film and video industry reported a 32% success rate. In terms of failure rates, projects raised on Indiegogo were most likely to fail, with a higher than 80% fail rate on this platform. RocketHub projects also had a more than 80% failure rate, but slightly lower than the Indiegogo failure rate. Looking at numbers rather than percentages, Indiegogo had 277,776 unsuccessful campaigns, and Kickstarter had 101,127 unsuccessful campaigns. However, Kickstarter also did have 70,812 successful projects. When considering overall success rate across all categories, again Pozible, Kickstarter and Tubestart perform the highest, with Indiegogo performing the lowest. This is helpful in deciding where you might want to post your campaign.
Turning to amounts funded, the study showed a very rapid acceleration of Kickstarter and Indiegogo in 2012 and 2013. This was followed what Krowdster reports to be:
“…a sharp slowdown in growth in 2014 US funding for Indiegogo and even a recession for Kickstarter.”
Indeed, the 2013 total funding figure via Kickstarter was $336 million, and this was quite significantly higher than the $282 million figure that was recorded in December 2014. It is reported by Krowdster that Indiegogo had a very small growth from $82 million in 2013 to $88 million in December 2014.
Rewards or perks are an interesting component of crowdfunding where benefits are received from the person donating money to thank them for doing so. Krowdster also tracked figures for rewards and perks on the platforms studied. Krowdster describes rewards/perks as being “non monetary tokens of appreciation.” Interestingly, and maybe why Pozible campaigns are more likely to be successful, this platform saw the highest number of rewards sold (64) per successful platform. In second place was Kickstarter with 51 donations, and in third place was Tubestart with 36 rewards per successful campaign. This is interesting as it appears to suggest that rewards may be rather important in driving a campaign that is successful overall, and that the quality of those rewards is important. On the Kickstarter platform most rewards were offered by successful film and video campaigns, but of course it is worth noting that the number of film and video campaigns that were successful via this campaign was lower than for Pozible. Krowdster also shows that reward structure is essential for campaigns and is a driver of success or not. The $25 price point is shown by Krowdster to be the overall best seller on platforms, and the top three rewards price points are reported to range between $5 and $100.
All of this has important ramifications for organisations and individuals that are thinking of raising money via crowdfunding platforms. While it is not clear if these figures only apply in the USA, or only apply to projects in the film industry, it is worth considering the impact this could potentially have on projects in other categories and industries. It is also extremely likely that the learning about rewards or perks applies to other types of projects, since the reward structure success did appear to be tied to specific platform success as well. Ultimately there are no guarantees when raising money via crowdfunding platforms but these types of pointers that help people to move in the right direction when setting up campaigns is helpful in leading to a greater likelihood of success. Additionally, choosing a platform with care to target a campaign is also important in achieving success, or so it seems. It will be interesting to see if these trends continue in the future.
Paula Newton is a business writer, editor and management consultant with extensive experience writing and consulting for both start-ups and long established companies. She has ten years management and leadership experience gained at BSkyB in London and Viva Travel Guides in Quito, Ecuador, giving her a depth of insight into innovation in international business. With an MBA from the University of Hull and many years of experience running her own business consultancy, Paula’s background allows her to connect with a diverse range of clients, including cutting edge technology and web-based start-ups but also multinationals in need of assistance. Paula has played a defining role in shaping organizational strategy for a wide range of different organizations, including for-profit, NGOs and charities. Paula has also served on the Board of Directors for the South American Explorers Club in Quito, Ecuador.