In combination with other financial boosters, Kickstarter can be a wonderful tool for companies to use to crowdsource, much-needed funds for certain projects. While there are some legal aspects to consider before creating your Kickstarter, it can be a tool that enables you to either create your own business, or jumpstart earnings and projects for your current company.
Consider these things before posting a project
First and foremost, the legal things that anyone should be aware of when using Kickstarter:
- If you or your company is sued for lack of progress, you’re on your own. Kickstarter will not back you in legal situations.
- Kickstarter will not fund you on its own, and you should consider using it in combination with other financing options. Crowd-sourcing may be popular, but it is fickle.
Now that that’s out of the way, let’s talk about Kickstarting your small business
Kickstarter has grown exponentially in the last two years. Though kickstarting may not be the easiest task, creating a Kickstarter that draws an audience’s attention (and keeps it) is key. Remember that if your company is already fairly large and has more than enough existing funds for a project, your project will be denied.
Companies who are looking for a certain monetary goal can post a Kickstarter for just about any type of project - the specific rules for projects can be found here - they need funded. By including incentives for reaching certain goals throughout the crowdfunding process, companies can incentivize backers to donate more in order to receive certain rewards.
Gaming companies tend to stick to different items such as t-shirts and early access, but companies such as record and CD companies can offer items such as limited edition CDs and records. Companies that offer rewards for reaching milestones tend to exceed their original goals. Keep in mind that goals must be reached within a certain timeframe in order for your project to be posted successfully.
Remember to keep that momentum once you’ve succesfully Kickstarted a project. If you need investors for bigger funds, use your leverage as a successfully Kickstarted project to show investors that your company or product is backed by demand.
Likewise, if your project isn’t successful the first time, don’t give up or throw in the towel. Even if your project failed, you’ve gained valuable exposure to the market and that exposure can only help you.
Using Kickstarter to start your own business
Using Kickstarter to start a business isn’t a new idea, and many people have made use of the platform in this way. However, it’s important to ensure that all of your project’s goals and purposes are in line with the Kickstarter rules. Be sure that your project proposal is unique and innovative, otherwise it could be rejected.
Once your project is approved, using your social media networks can really boost your backer numbers. What most don’t realize about Kickstarter projects is that the only promotion you’ll receive is self-promotion; without proper promotion, it’s very likely that your Kickstarter won’t meet its goals before the deadline, and thus won’t be funded.
Some things you should create to boost your self-promotion:
- A company website, or website that adds more information on your goals and ideas, is a great way to inform potential backers. Though Kickstarter gives you a landing page, creating an online space for your company beforehand can show backers that you’re serious about starting a company.
- Create a video! Show people your product, your ideas, your spaces, or even the type of service you provide. It may even be worth investing in having a video professionally made to ensure high video quality.
- Turn to friends to help you out. Most Kickstarter projects are a mixture of Internet strangers and people you know. Don’t be ashamed to promote yourself to friends and family; sometimes they can be your biggest backers.
Match incentives realistically to tiers
One mistake that many Kickstarters make in their projects is that their rewards don’t really match up with their goals. Be sure that your incentives are both realistic (meaning you can actually deliver on them) and that they’re around the same quality and value of the amount tied to each tier.
For example, backers in the $10-$15 may be happy with receiving a company t-shirt, but backers in the $1,000 range probably won’t be. Instead, consider offering in-person tours of your space once it’s funded, or a prototype of your product/service before it’s released to the general public.
Use Kickstarter Wisely
Some people may think that funding a project with Kickstarter is about as easy as it gets in terms of asking people for money, but it’s an incredibly fickle platform. While some people may receive an absurd amount of money for potato salad, realistic and wonderfully innovative ideas may fall flat in terms of funding. By following the simple tips and principles listed above, creating a successful Kickstarter could be just what you and your company need.
Sourced image: Kickstarter