How to Launch Your Business with Kickstarter

Kickstarter Overview

Kickstarter, a company crowdfunding website established in 2009, has assisted over 150,000 companies and ventures in raising $4 billion in total funding. Small companies that succeed on Kickstarter are more likely to gain a loyal consumer base as well as positive social media and press coverage. And, unlike a business loan, the funds you collect on Kickstarter are entirely yours. Small business owners with an interesting project and compelling story to tell can find Kickstarter to be an excellent platform. It isn’t as easy as setting up a Kickstarter account and watching the money roll in. If you want your Kickstarter campaign to succeed, you’ll need to devote time and energy to it, as well as think strategically. Just about 37% of company owners who initiate a Kickstarter campaign succeed in reaching their funding target. Learn how to launch your business with Kickstarter by reading this article.

Before we tackle how to launch your business with Kickstarter, we must first know what it is.

What is the Process of Kickstarter?

The basics of how Kickstarter works are fairly straightforward. Any specialist in the arts, comics, crafts, dance, architecture, fashion, film and video, food, gaming, journalism, music, photography, publishing, technology, and theater is eligible to launch a campaign on the site. A large number of small businesses fall into one of these groups.

However, bear in mind that the Kickstarter platform’s used to assist you in raising funds for a particular project. You can use the money to start a new product line, buy materials and supplies, or open a new store, for example. Without a particular target in mind, you can’t use Kickstarter to raise funds to start a company.

Learn the Lingo of Kickstarter

Before you will know how to launch your business with Kickstarter, you’ll need to understand some simple Kickstarter terms, no matter what industry you’re in or what project you’re working on:

1. Your project’s page on Kickstarter, which contains all of the information about your project.
2. A backer is an individual who pledges to donate money to your campaign.
3. The sum of money you’ll need to finish your project is your funding target.
4. The project’s creator is a small business owner or a creative specialist.
5. Backers receive rewards in the form of interactions or goods from the maker in return for their support.

How to Launch your Business with Kickstarter

Organize The Campaign

After you’ve mastered the fundamentals, you’ll need to take the following measures to begin your Kickstarter campaign and collect funds:

Make an account on Kickstarter. It is completely free to create an account, and it only takes a few minutes. All you have to do is enter some personal data and generate a password.

Describe the project in detail. This is the most crucial move, and it determines whether or not your project will be successful. You must upload photos or videos of your project, state your funding target, and include samples of your project during this process.

Decide on the incentives. Then you’ll have to find out what you’ll give your supporters in return for their money. Some supporters contribute as little as $1, while others contribute $5, $20,$100, or more. You can create different reward rates for various levels of help, but you must be certain that you can produce and distribute these rewards, your checking or savings account. The final step is to link your business bank account to your Kickstarter account, which will enable you to receive funds.

It’s a good idea to look at existing projects and learn more about this platform and feel more informed before starting your own. This will assist you in identifying trends in what has and has not succeeded in your industry.

The Rules of Kickstarter Funding

Anyone who is 18 years old or older and works in one of the above-mentioned creative industries is for this platform.

However, you have to follow these rules:

1. Clear, truthful image of your idea: You’ll need to show backers a clear concept or project prototype, and picture renderings aren’t going to cut it. You must be open and honest about what you’ve done so far and what you plan to do with the money they gave you.
2. Projects cannot raise funds for charity: While nonprofit organizations are free to raise funds on Kickstarter, you cannot use the fund to support a charitable cause.
3. Since crowdfunding does not allow for investment, you cannot provide revenue sharing, equity, or other investment opportunities to your supporters (some other crowdfunding platforms, such as Indiegogo, do allow equity-based funding).
4. Prohibited objects are not included in projects: Projects involving energy drinks, health goods, cannabis, or financial/business services are all prohibited on Kickstarter. You can’t just repackage or resell an existing product; the creator must build and produce the incentive.

Kickstarter’s funding model is all-or-nothing. That means you won’t get any money if you don’t get enough pledges to meet your funding target. You also get to keep the extra money if you earn funding that exceeds your target number.

It’s important to follow the Kickstarter rules. If you break any of these laws, a suspension is risky for the site, and possibly facing legal action from your supporters.

Pricing

Kickstarter earns money by getting a share of the funds pledged to you by supporters. There are no fees if you are unable to finance your project, so you can try Kickstarter without risk. Kickstarter can take a 5% fee if the project is successfully funded. In addition, Stripe, Kickstarter’s credit card processor, receives between 3% and 5% of credit card transaction fees.

Kickstarter encourages developers to collect small sums of money from a large number of supporters by charging a reduced total fee of 5% + $0.05 per pledge for pledges under $10.

If you’re going to sell a physical product to your supporters, keep in mind that there will be shipping costs. You take these into account in backers’ pledges. In other words, if a backer pledges $10 but you charge $8.95 for delivery, they would ultimately pledge $18.95.

Conclusion 

The items mentioned in this article are the basic things you need to know. With this new knowledge, you can start creating your business for you to launch.