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Crowdfunding is Hard. Do it Better.


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Fellow Knodes social data nerd and crowdfunding afficianado Emma Larkins ( pulled together an amazing set of data about what people THINK is hard about crowdfunding and what we've learned can be done to achieve success. We did this in response to people using Knodes tech for crowdfunding outreach. We were curious.

This paper is the intro to a larger research project that Emma is doing on what conditions create successful outcomes on Kickstarter, Indiegogo and other crowdfunding platforms.

Follow her. Laud her. Love her. This is good stuff.

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Crowdfunding is Hard. Do it Better.

  1. 1. Why CrowdfundingIs Hard - And HowTo Do It Better(Hint: recruit the right crowd. Early, and often.) Crowdfunding is the new gold rush. It opens up great opportunities for prospectors willing to accept the risks, but not without tons of challenges. Here are some things to consider be- fore you pack your donkey and head into the wilderness.
  2. 2. Does It Work? According to the data, the majority of crowdfunding projects fail. 57% of Kickstarter Projects Fail 43% of Kickstarter Projects SucceedMoreover, the majority of failures do so bylarge margins.1 1 - 20% Funded 27,753 (62%) Number of Failed Kickstarter 0% Projects Funded 21 - 40% 9,111 Funded 41 - 99% (20%) 5,257 Funded (12%) 2,749 (6%) Total 44,870Launching a project only to see it miss its funding goal might make you feel like you’re stuck inone of those horrible presentation-in-your-underwear dreams, and could result in the squan-dered goodwill of supporters (both friends and strangers). Your project will take care and feed-ing, but will be worth it.
  3. 3. What Stops a Good ProjectFrom Succeeding?Sure, there are projects on Kickstarter and other crowdfundingplatforms that just shouldn’t be funded, like this documentaryon Juggalos. Ew. But there are also tons of great projects that Maybe thedon’t end up getting the resources they deserve. These are proj-ects that might have ended up entertaining us, motivating us, rewards wereor dramatically impacting our economy, technology, or society. poorly chosen, orSo what went wrong? Maybe the rewards were poorly chosen,or perhaps the video was too long. Did the project owner de- perhaps the videoscribe the product or project clearly? Did she talk to the rightpeople about the right things at the right time? Did he provide was too long.updates that were highly shareable? Did she wait until the lastweek to make her big push for support?How Can You Improve Your Chances ForSuccess BEFORE Your Project Starts?The fact that you’re reading this puts you ahead of the pack when it comes to starting out on the right foot.You’re doing the legwork to make sure that your project starts out and finishes the same way: strong. We’ve gotsome insights to help.We’ve researched the Kickstarter-related conversations people are having on Facebook and Twitter, and it turnsout there are at least three major areas of anxiety before the project even launches: 1. Defining the project (storytelling, rewards, etc) 2. Creating content for the project (Shooting video? How long? Pictures? Graphs? Updates?) 3. Building support for the project (Who to ask? How frequently? What channels?)These are all important, but defining and creating assets for your project are pointless if you don’t build the rightsupport. We’ve found some good resources around #1. & #2., and Kickstarter itself has a solid primer here.
  4. 4. Building the right supportersfrom the beginning Unfortunately, there aren’t many tools or resources available to make your supporter outreach effective. A lot of people start target the out with an “if I build it, they will come” mentality, and when that doesn’t work, turn to aggressively bombarding – and of- individuals... who ten overwhelming – their social networks. It makes much more sense to target the individuals within your extended networks are most likely to who are most likely to want to help you – either because they like you, or because they’re really interested in the merits of want to help you. your project. With these invested, enthusiastic early adopters in hand, you stand a much better chance of getting the strong, initial sup-port-base that is key to determining whether you make it across the finish line. To do this well, you can’t thinkof your network as a black hole into which you throw requests and pray for responses. Instead think of it as adata-rich, intricate web of hundreds (or thousands) of people who have different reasons for caring about youor your project. The key to optimizing your outreach is to figure out which of these folks listen to you when youpost, respond to you when you tweet, re-share your stuff, and click your links. But wait, there’s more! The stepsto make your network actually work look like this: 1. Understand who is likely to back the project. 2. Understand who is likely to back you. 3. Understand who is likely to spread your word. 4. Message according to role and always personally if possible.You will, of course, augment this segmentation and personal messaging with public social media blasts, but hav-ing a base of deeply invested early supporters is crucial.If you think that deeply understanding your network might be of use, check out what we’ve already built forprivate testing and stay tuned for more insightful research into what really makes crowdfunding succeed. Brought to you by the social data nerds at Knodes. Want to see what we’re working on? Check out “Kickstarter Stats”Kickstarter. 7 Jan. 2013 <>