As a quick re-cap, Kickstarter enables creative types of all colors to make their pitch online for funding and solicit micro-contributions from family, friends, admirers. While donations are not investments -- donors do not get a share of any proceeds of the project -- a project only receives money if it is 100% funded, reducing risk to both donor and artist.
The site has now facilitated over $250,000 in the 10 weeks since its launch, and that's while remaining invitation-only for artists. What Kiva is doing for micro-entrepreneurs, Kickstarter is doing for budding artists -- through small contributions, as little as $1, people can come together to collectively fund a creator's dream project. Anyone can become an art patron.
Andy's blog today has some interesting insights on success in crowdsourcing financing:
- All-or-nothing. Projects are only successful if they reach the fundraising goal by the deadline, otherwise nobody pays. This limits risk for both backers and project creators, who don't have to worry about committing money and time to a failed project.
- Rewards. We strongly emphasize the importance of crafting good rewards, which makes Kickstarter more like commerce than altruism. We support multiple tiers of rewards from $1 to $10,000, limits for each, and tools for creators to contact each tier group independently.
- Publishing. A simple and powerful reward is access to exclusive updates during a project's funding and development, creating a powerful connection between the audience and project. As a result, we offer publishing tools for public or private updates, including hosted media and update notifications.