Kickstarter passes $1B in pledges | Hacker News Reader

Kickstarter passes $1B in pledges

kickstarter.com

214 pointsmecredis66 comments

Congratulations, Kickstarter.

In my opinion, Kickstarter is one of the most important tech startups of the last few years for democratising the process of project funding so significantly. It's started to change the way people do business and create things in such a fundamental way.

One of my favourite examples to give is the way in which games can now be funded. The truth of the matter is that games can cost a lot more than they used to, but for the last 15 years Publishers have had such a strong influence over which games do or do not make it to market and they know that a mass market game is going to be less risky than something like Double Fine's Broken Age. So they probably won't fund it, and I can kind of see why.

Now thanks to Kickstarter et al., a developer just has to be able to say to potential fans, "is this a game you want?!" and if they say yes, they essentially pay in advance for their game. It's so direct, it's so wonderful.

Yes, there's still an element of having to sell the idea, but at least the idea is being sold to a bunch of regular folks, who have a little bit of money as opposed to somebody in charge of a large business. The decisions are much easier to make, and the risk is much lower for the investors.

I hope crowdfunding in this way isn't just a flash in the pan. I hope we continue to see projects funded in this way for a long, long time to come. Here's to another billion, Kickstarter!

As a backer and project creator who's running a Kickstarter funded startup, I couldn't agree more.

I love your example but I want to point out that the same obstacle you mention with games is applicable to most of the other industries that are funded on Kickstarter. The root problem in all cases lay in a startup's:

1) need for an audience

2) need for capital

What kickstarter has successfully done is build a loyal audience that's massive in size. I came to really appreciate this after seeing more than 80% of my funding come from people visiting kickstarter.com who didn't know about my project beforehand. This was huge. And not only does it give you the visibility and the capital required to execute, it validates your idea to a large extent.

Good luck with your campaign! If you don't mind I have a few questions if you happen to know the answers:

1. Did those 80% of people see it through a "featured campaigns" thing or was it totally organic? 2. How did the remaining 20% find your campaign? 3. Can we see the campaign page? :)

Thanks. The campaign ended a while ago but here are the answers:

1. We weren't featured by KS but it was on the "popular projects" page throughout the life of the campaign. It initially got there by a combination of backers finding it through "Recently launched projects" + backers who signed up on our website to be notified of the launch (the former being the majority). By the end of Day 1, it was #1 in its category and stayed there for a while. Here is a link that shows the trend of the project funding if you're interested: http://www.kicktraq.com/projects/yathletics/silverair-odorle...

2. Remaining 20% found it through our own marketing efforts + other websites/blogs writing about the project

3. Sure thing - https://www.kickstarter.com/projects/yathletics/silverair-od...

Ah, cool. Good advice, and congratulations on smashing your target :D

Honestly this seems like the most logical way to go about validating a product if you are starting with absolutely nothing.

Pitch it to the public, and see if people want it. Then they give you the money to make it.

I skimmed over the map to find some interesting data:

* Averages are close to $200 per backer

* USA has $175 avg per backer, but makes 2/3 of that $1B

* The middle east (UAE, Saudi Arabia, Koeweit, ..) spends $400 up to almost $800 per backer

* Antartica has 11 backers @ $337/backer :-) 4th place, after the middle east, After that, Norway ($280), Belgium ($250)

Would be interesting to plot this data against the number of citizens, so you can get a view of the participation rate of a country. (The US would top that probably at around 1%)

Edit for readability

I was looking how to skim the data and I couldn't find a way.

Yes, it would be interesting to see the spending per capita & how it correlates to GDP.

Now find a way to correlate that to language and project country stats. As far as I can tell all Kickstarter projects have to be in the US/UK/Australia/NZ and of course, the entire site is in English.

UK contribution - 54 million $, German contribution - only 21 million $. Something is obviously off.

At this point I'd focus on horizontal growth - get in as many important geographies as possible, focus on key languages: German, French, Spanish, Chinese, Portuguese, Russian.

> UK contribution - 54 million $, German contribution - only 21 million $. Something is obviously off.

The obvious solution is for people that want to be backed to offer versions of their videos dubbed to German.

That's pretty impressive. Kickstarter has a 5% fee (and Amazon their own processing fee) which means ~$50m in revenue for Kickstarter and $25M in revenue over the last year. I wonder how long they'll keep with Amazon as payment processor, it seems like they're leaving a lot of money on the table.

I wonder how long they'll keep with Amazon as payment processor

On the other hand, tons of people have Amazon accounts and using Amazon as a payment processor is really easy. I've only backed a handful of projects (https://www.kickstarter.com/profile/1482970964), but I was shocked at how simple it was to do so: click "okay" on Amazon, enter a password, and it's done.

They are only using Amazon for US-projects, all of their other sites fore their new countries pay "directly" to Kickstarter: https://www.kickstarter.com/help/faq/backer+questions#faq_41...

I know it says that but the UK definitely uses Amazon, at least it did when I backed something last night.

Were you backing a project at the UK Kickstarter, or are you in the UK backing a US Kickstarter? What payment backend is used depends on where the project is based, not the backer.

Good point - US based project.

Isn't the 1bn just for pledged money though? Is there a breakdown of what percent of pledged dollars actually gets funded (when KickStarter takes their cut).

Not saying they didn't do well, but I'd estimate the cut they make is somewhere closer to 30-40mm and not 50mm.

Correct, but the total is higher than your estimate:

https://www.kickstarter.com/help/stats

$859M in successful dollars which comes to $43M, though that doesn't count current pledges for projects that will go on and succeed (there are currently $24M "live" dollars).

here's a podcast on this very subject: Its actually really interesting.

http://www.npr.org/blogs/money/2013/10/04/229224964/episode-...

I just found out that my uncle, whom I thought very successful, failed to fulfill his responsibilities to his backers. He was working on a 3d printer that I was hoping to get to buy some day, but he never delivered more than a few of them (most of which didn't even work) and now his backers are trying to get together to sue him. A few days ago he filed for bankruptcy so they probably won't get anything.

As much as I love the idea of kickstarter, I have now seen first hand how you can be cheated and just can't trust the system to work (although many have and it has worked for them). After the disappointment of Minecraft when Notch started making a ton of money I have simply stayed away from all crowd sourcing/buy-and-play-during-alpha projects for good. There is nothing wrong with simply waiting until something is finished to buy it.

What happened with Minecraft?

Notch was very free with his ideas. He'd often just propose them on Twitter. Sometimes he'd say that a certain feature would be in but later drop it because he thought it wouldn't be good. Also, the game has had a huge community since when it was relatively young and it has evolved in a specific direction (meaning people who started when it was new but expected a different end result were displeased). Notch also seems to have become somewhat bored with the game.

These things combined make some people upset with Notch. Apart from this, nothing really happened with Minecraft. It continues to be a highly successful game and frequently gets new features.

Nothing to be done about it, really. You can't please everyone.

These stats can actually be quite useful if you ever decide to create a project on Kickstarter. For example, most of the money is granted on Wednesdays and between 10 and 15th of the month, so you can plan your funding cycle accordingly and increase marketing efforts during this period.

Not _most_ of the money, a tiny fraction more on average, and they give no confidence intervals or measure of variability so I'd bet it's just noise (if you pick ten random numbers, one of them has to be the highest).

Keep in mind that correlation is not causation. :-) (disclaimer: I work at kickstarter)

I found it curious that it correlates to the middle of the work week plus basically the middle of the month!

Pay-week for lots of people maybe?

Indeed. But still, somehow I think it makes sense to consider such stats, especially if differences are quite big between contributions on eg, Wednesday compared to Saturday/Sunday. In any case, I would love to see more of these statistics. It seems like an interesting piece of information that can help understand how crowd-sourcing "ticks".

That's a pretty website. I was impressed by the animations. What is the term for these kinds of slideshow-like sites?

That was simple one-page website with good transitions.

No doubt it's simple, but it's attractive (probably largely thanks to the artwork). Not so great on my iPhone though.

And thanks, it looks like "one-page site" is what they're called.

I didn't much like how the first graph built up while scrolling, iirc other sites normally make the graph static to the page while its built up during scroll. This one the graph was moving across my screen as it assembled, quite awkward.

I believe it's parallax scrolling. There's been a few that have done it with variable levels of success.

I would love to know what the successful payout total is.

There will be a website for that figure too. Just wait until it hits 1 billion.

That would be a much more useful figure. The only stats I can find are here[1] but it just lists the number of successful projects not how much was pledged to them.

[1] https://www.kickstarter.com/help/stats

EDIT: Oops, there page actually lists $859M as the amount successfully funded!

I feel like there are lots of people making sure no project stops at 99%. I know I barely use KS, but even I've sorted by "ending soonest" before and watched a few projects make it safely over to 100%.

That said, I'm glad to head the 20% number :)

This is posted on our public stats page, which is updated every couple of hours:

https://www.kickstarter.com/help/stats

Lifetime, 86% of money pledged has been to funded projects ($859 million as of this writing). Just 12% has been to unsuccessfully funded projects. (The remaining money is currently live and its outcome undetermined.) The degree to which pledges are truly all or nothing has always surprised us. 80% of projects that raise 20% of their goal are eventually funded. It's a highly efficient system.

Tangential.. Kickstarter mentioned influential contributors but for whatever reason didn't give links to their backed project and I was particularly curious about what projects Neil Gaiman had backed. They weren't kidding, he's quite the prolific backer! https://www.kickstarter.com/profile/108204027

Wonder how much of this 1 billion actually successfully resulted in backer rewards and wasn't indefinitely borrowed/outright stolen. Just recently a webcomic artist John Campbell who raised $50000 wrote a long screed telling his backers that they will never get the book they paid for. And a lot of projects get completely forgotten about after they get fully funded.

I realize it's hip to bash on Kickstarter, but in my experience it works out well all the time. I've backed 28 funded projects: of those only one is currently past their delivery date (the Almond+) and they've been very good about updates. Other projects have also been late, sometimes by six months, but they all get delivered.

I tend to think of Kickstarter schedules like I think of software developer schedules: double it and add 3. Planning is hard, and for a lot of the creators it there first attempt at a large project.

Almost certainly an astonishingly high percentage of it. You hear about the bad stuff, but by and large it works. A lot of projects get delayed and some don't work out as expected, but very few could be classified as "stolen". Even in your example, many people did get the book. No one got the book they paid for since that's not how Kickstarter works (it's not a store).

It is very interesting to observe that countries who spend the most on kickstarter are the same ones as the ones which spend the most in the Apple app store.

Likely due to extreme wealth/access inequality. In countries where the population is split between the extremely poor and the very rich the averages are going to be skewed higher.

Love the price comparison - what you can get for $1.000.000.000.

Also amazed that more money where backed from Antartica then some African countries.

The share buttons at the bottom don't work.

The country wise breakdown is fantastic, roughly indicates the startup culture present in the countries

Or just countries in which kickstarter is popular or even just available.

Even a simple color-coding scheme would have helped.

At first, I thought the blue color represented countries with at least one backer. "Huh, North Korea? Really?" Turns out every country is blue. Was disappointed.

Yes, the English only, US/UK/AU/NZ based startup culture.

That's actually really, reallyyyyy impressive... Congrats to Kickstarter.

Congrats to all of us!

When will we see crowd equity sites? Ie invest in early startups and get equity in the company.

The SEC is in the process of changing the rules to allow this as part of the USA JOBS act [1]. I think the timeline still depends on them but you should start seeing those sites come live around Q4 2014.

[1] https://www.sec.gov/News/PressRelease/Detail/PressRelease/13...

Everyone can be a VC!

http://www.crowdcube.com/, http://www.seedrs.com/ - UK companies along those lines

Also www.wefunder.com for the US.

Any day now. The SEC has been dragging its feet implementing the JOBS act. Congress mandated that they implement equity based crowd funding provisions months ago but they haven't done so.

"A million dollars isn't cool. You know what's cool?. A billion dollars."

"No, it’s not. It’s not cool. I think being a wealthy member of the establishment is the antithesis of cool. Being a countercultural revolutionary is cool. So to the extent that you’ve made a billion dollars, you’ve probably become uncool."

- Sean Parker's response to his portrayal

Sean Parker, net worth $2bn.

(I guess that he probably knew the implication of what he was saying when he said it.)

I live in france, and kickstarter doesn't seem available here :(

Off topic but looking at the map, it validates the old libertarian axiom that the more liberties, the more prosperous the economy, the more donations for utilitarian causes.

Who will feed the poor? Liberty will.

Or if not the poor, then the people with extra time on their hands and means to create compelling videos for interesting projects, and if not to feed anyone, then to allow allow them to work on creating something people with disposible income find interesting enough to sponsor as an artistic project or product pre-order. But yeah. Freedom and luxury lets some people and society accumulate disposible income and focus it on discretionary products. A billion dollars by 5.7 million people is $350 per person. Great that 0.1% (5.7 million people) have that kind of cash. Doesn't say much about whether 99.9% of people have any, or show that those $350 are a worthwhile cause for the 99.9% of people who aren't donating.

This isn't to take anything away from Kickstarter - I think it's great. But let's have some perspective.

Get off your high horse, the stats are obviously skewed: https://news.ycombinator.com/item?id=7334642

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