If you are a creator planning to use crowdfunding, it’s important to know what to expect. A big part of setting expectations for yourself and your team is knowing and understanding crowdfunding metrics. I encounter many people daily that are searching for funding for their business, but they don’t understand the numbers behind what it takes to run a successful crowdfunding campaign and what the realities of crowdfunding outcomes are. My goal is to use data collected from many sources to put crowdfunding into better perspective and understand what it takes to launch and manage a campaign and the realities of crowdfunding campaign outcomes by the numbers.
I was introduced to a former fortune 500 company executive that want to start their own business. They had an in-depth understanding of business and the numbers from 20 years of corporate experience. Our first meeting the budget was laid out and ready to move forward. One of the best most thought out plans I had ever encountered from a creator. The ask was almost $200 thousand and there was practically no crowd built on social media or a large email list for the project. Managing expectations was the first step in this process. So many people come to the crowdfunding world with the unrealistic expectation of what crowdfunding is and what it can do for a startup. Kickstarter has a tap on their website where the constantly post and update the data of crowdfunding.
We took a look at the real outcomes of crowdfunding on Kickstarter as a whole and then we drilled down on the specific industry and we decided on a realistic goal based on the data point of Kickstarter. Of the 131,535 successful Kickstarter campaigns the 73,801 fell between $1,000 and $9,999, and if you combined all other funding categories the total was 57734 the total was 16,067 less successful campaigns. There is a sweet spot for Kickstarter campaigns based on the data.
Crowdfunding is a data analysis game that requires research into the numbers and understanding the process of successful campaigns and avoiding the mistakes of the failed campaigns. Make your decisions based on the best data available and do your research before you launch.