Updated June 28, 2019: added more information and clarified some other things.
I started writing this post on November 1, 2018 which explains the recently comment. I recently made my first contribution to crowdfunding, sometimes called crowdsourcing. It was to the Bunnies and Barrows 3rd Edition RPG Kickstarter (B&B) that ended on October 25, 2018. It wasn’t a lot of money, and the campaign had been fully funded before I added my small portion to it. I thought it was important to see how a crowdsourcing campaign worked as I am a strong believer that a good crowdfunding campaign can exceed expectations. However, over the last month, I noticed some campaigns do very well and others with much smaller goals do poorly. For example, B&B – https://www.kickstarter.com/projects/froggodgames/bunnies-and-burrows had a goal of $12,000 and had pledges of $36,403 and 786 backers. Generally, between 1 – 5% of pledges fell for various reasons; by 1 – 5%, I am talking about number of people pledging that fail which may or may not equate to a similar loss of pledged money. Throw in around 10 – 12% for fees charged by the crowdfunding platform and fees for payment processing charged by whatever companies handle processing payments. For crowdfunding that includes rewards, allow a fair percentage (probably 20 – 25%, possibly a lot more depending on what is offered) of the pledged money to cover the cost of rewards.
Adding Stretch Goals is a good way to reward exceeding your campaign’s basic goal without risking the campaign not being funded. Some of the crowdfunding sites have an all or nothing policy which means if you meet the goal originally, but failed pledges drop you below the goal, then your campaign might fail. Some give you get the money even if you miss the goal. Kickstarter is all or nothing and the stretch goal option is a way to keep interest in your project without adding a higher risk of your campaign failing.
This campaign was funded in 20 minutes and has hit thirty-four (34) stretch goals with three (3) days left on the campaign: https://www.kickstarter.com/projects/598470884/dungeon-universalis. It’s original goal was $39,688 (estimate based on today’s Euro to Dollar conversion rate). It’s at $222,149 with 1,862 backers. This is not typical, but it happens on a somewhat regular basis. I have also see small campaigns fail. One had a goal of $500 and only received around $120 in pledges by the time it ended.
It’s important you do everything you can to set reasonable monetary goal amounts and use stretch goals in case you succeed beyond your wildest dreams. Use social media – Facebook, Twitter, YouTube, Instagram, LinkedIn, etc. to get the word out. Adding a video is also important as campaigns with videos are 3x more likely to get funded. You can add the video on YouTube or another social media video outlet as some people will find your campaign through the social media video. Many campaigns have several videos in their description. Good photos are helpful so people can get an idea of what your project will look like.
It’s also important to keep in touch with updates and respond to comments. Dungeon Universalis (above) has forty-four (44) updates and 2,167 comments. While it’s not necessary, a growing number of campaigns factor in shipping costs as those can vary widely, depending on your product. Many campaigns don’t include shipping so you should factor that cost into your equation when deciding to support something that may have a large shipping cost.
It’s also a good idea to look at similarly priced products in your field that were funded above 100% to see how they did it. Here’s a good example, but he had help from C-NET: https://www.kickstarter.com/projects/zackdangerbrown/potato-salad. C-NET – https://www.cnet.com/news/guys-kickstarter-dream-making-potato-salad-possibly-with-dill/ picked it up and by the time all was said and done, his $10 goal had a pledge total of $55,492 with 6,911 backers.