Table of Contents
Kickstarter vs Indiegogo: Which One Is Better?
Time: Mar 08,2024 Author: SFC Source: www.sendfromchina.com
Crowdfunding has revolutionized how entrepreneurs, creatives, and innovators bring their projects to life. Among the myriad of platforms available, Kickstarter and Indiegogo stand out as the giants in the space and have gained popularity these years.
This comparison dives into each platform's unique features, key differences, and how to decide which one is better suited for your project.
This comparison dives into each platform's unique features, key differences, and how to decide which one is better suited for your project.
1. What Is Kickstarter
Kickstarter is a pioneering crowdfunding platform designed to help creative projects come to life through direct financial support from a global community of backers. Kickstarter serves as a bridge between innovators and those who wish to support creativity, enabling creators from various fields such as technology, arts, music, and publishing to present their ideas to the world. Kickstarter operates on an all-or-nothing funding model, where projects must reach their funding goals within a specific timeframe to receive the pledges made by backers. The model of Kickstarter encourages creators to set realistic goals and fosters a sense of urgency among backers to support their favorite projects to ensure they come to fruition.
Since its launch in 2009, Kickstarter has become a hub for creative minds looking to bring their unique ideas to life without relying on traditional financing methods. Kickstarter not only facilitates funding but also fosters a sense of community by allowing creators and backers to communicate directly. Through Kickstarter, numerous projects have been successfully funded, ranging from innovative gadgets and groundbreaking films to unique art installations and board games, demonstrating the platform's versatility and its pivotal role in supporting creative endeavors across the globe.
1.1 What Are the Advantages and Disadvantages of Kickstarter
When it comes to crowdfunding, Kickstarter is often the first platform that springs to mind for many creators and entrepreneurs. It's a beacon for launching everything from indie films to groundbreaking tech gadgets. But, like any platform, Kickstarter comes with its own set of pros and cons.
Advantages of Kickstarter
1. All-or-Nothing Funding Model
The All-or-Nothing Funding Model can create a sense of urgency among backers, potentially leading to more contributions as the campaign deadline approaches. It also ensures you don't have to fulfill your project promises without the necessary funds, reducing risk.
2. Strong Community and Visibility
Kickstarter has a large, active community of backers who are enthusiastic about supporting new projects. Being featured on Kickstarter can provide significant visibility and credibility, which is invaluable for new creators.
3. Success Stories and Reputation
Kickstarter is known for numerous success stories, particularly in categories like technology, design, and games. A successful Kickstarter campaign can not only fund your project but also build a strong foundation for your brand and future projects.
4. Project Validation
Launching a project on Kickstarter can serve as a market test, validating your idea based on the interest and financial support it receives from the public. It is crucial feedback for early-stage projects.
5. Backer Engagement
Kickstarter’s platform facilitates deep engagement with backers, allowing for updates, comments, and direct communication. This can help build a loyal community around your project or brand.
Disadvantages of Kickstarter
1. All-or-Nothing Funding Model
The flip side of the All-or-Nothing model is that if you don’t meet your funding goal, you receive nothing. It also can be a significant setback, especially after investing time and resources into your campaign.
2. Intense Competition
With thousands of projects live at any given time, standing out on Kickstarter can be challenging. Your project needs to be compelling and well-marketed to capture attention.
3. Strict Project Guidelines and Approval Process
Kickstarter has specific guidelines for projects and requires a review process before you can launch. Not all projects are accepted, which can be a hurdle for some creators.
4. Pressure and Expectations
Successfully funded projects face the pressure of delivering on their promises within the projected timelines. Delays and challenges can lead to unhappy backers and a tarnished reputation.
5. Fees
If your project is successfully funded, Kickstarter costs 5% of funds raised plus a small fee for each pledge, and there are additional payment processing fees. These costs need to be factored into your budgeting.
2. What Is Indiegogo
Indiegogo is a versatile crowdfunding platform that stands out for its flexibility in supporting a wide range of projects, from inventive startups and tech innovations to community projects and artistic endeavors. Unlike its counterparts, Indiegogo offers two distinct funding models: fixed and flexible. The fixed model operates on an all-or-nothing basis similar to other crowdfunding platforms, requiring campaigns to meet their funding goals to receive the money, while the flexible model allows creators to keep whatever funds they raise, regardless of whether they hit their target. The dual approach of Indiegogo enables a broader spectrum of projects to seek funding, catering to different risk tolerances and project needs.
Since its inception in 2008, Indiegogo has cultivated a diverse and dynamic community of backers and creators worldwide, fostering an environment where ideas can seek validation, and projects can find the initial capital to take off. Indiegogo is known for its openness to a variety of projects, including those that may not fit the traditional mold required by other crowdfunding sites. Indiegogo’s post-campaign services, such as InDemand, which allows campaigns to continue raising funds after their initial campaign period, and its marketplace for successfully funded products, provide an extended ecosystem for projects to thrive beyond the fundraising stage, highlighting its comprehensive approach to supporting innovation and creativity.
2.1 What Are the Advantages and Disadvantages of Indiegogo
Indiegogo, like Kickstarter, is a heavyweight in the crowdfunding arena, but it dances to a slightly different beat. Its more flexible approach to funding and campaign management makes it an attractive platform for a wide range of projects. However, every platform has its pros and cons, and Indiegogo is no exception.
Advantages of Indiegogo
1. Flexible Funding Options
Indiegogo stands out with its Flexible Funding option, allowing you to keep whatever amount you raise, even if you don't meet your initial goal. This is incredibly beneficial for projects that can adjust their scope based on available funding.
2. InDemand Program
After a campaign ends, Indiegogo offers the InDemand feature, which enables you to continue raising funds indefinitely. It is a fantastic way to keep the momentum going, allowing for ongoing sales and increased visibility.
3. Global Reach
Indiegogo has a slightly more lenient approach regarding who can launch a campaign on Indiegogo, making it more accessible to creators worldwide. Its inclusivity helps diversify the types of projects you’ll find on Indiegogo.
4. Market Testing and Product Development Support
Indiegogo’s partnership with companies provides valuable resources for tech projects, including access to expert advice, design tools, and potential funding opportunities, aiding in product development and validation.
5. Community and Backer Engagement
Like Kickstarter, Indiegogo has a passionate community of backers eager to support new ideas. Indiegogo also offers tools for engaging with backers, crucial for building a loyal following.
Disadvantages of Indiegogo
1. Perceived Lower Prestige and Visibility
Indiegogo is often viewed as Kickstarter's slightly less prestigious cousin, which can affect the perceived credibility and visibility of campaigns. This perception may influence the level of media attention and public interest your project receives.
2. Flexible Funding Risk
While the Flexible Funding option provides an opportunity to keep whatever funds you raise, it also presents a risk. If you don’t reach your goal, you still need to fulfill your promises to backers, which can be challenging with limited resources.
3. Competition and Discovery
Despite being more inclusive, Indiegogo’s platform is still highly competitive. Standing out among the myriad of projects requires effective marketing and promotional strategies.
4. Fee Structure
Indiegogo’s fee structure includes 4% of funds raised plus a small fee for each pledge, similar to Kickstarter, plus payment processing fees. For Flexible Funding campaigns that don’t meet their goals, the platform fees can be 9% of funds raised if flexible and 0% if free, impacting your net funding.
5. Varied Project Success Rates
The success rate of campaigns on Indiegogo varies widely by category and funding model. Projects need to carefully consider their strategy and potential appeal to the Indiegogo community to maximize their chances of success.
All-or-Nothing Funding Model: The All-or-Nothing funding model on Kickstarter means that a project must hit its funding goal to receive any money. If the goal is met or surpassed by the deadline, the project gets funded. If not, no money changes hands; backers aren't charged, and creators get nothing. The All-or-Nothing funding model creates urgency, ensures backers only pay for projects that have enough support to succeed and helps validate the project's demand. The All-or-Nothing funding model requires creators to set realistic goals and actively engage with their audience, but it also protects them from overcommitting if they don't receive enough funds.
Fixed and Flexible Funding Model: The fixed part is similar to the All-or-Nothing funding model of Kickstarter. Moreover, the Fixed and Flexible Funding Model also allows creators to keep all the funds they raise, regardless of whether they meet their funding goal. This means even if the campaign falls short of its target, the creator still receives the funds raised, minus Indiegogo’s fees. Flexible Funding is suited for projects that can adjust their scale or scope based on the amount of funding received, offering a level of flexibility and security for creators to proceed with their projects with whatever funds they have raised.
3. What Is the Difference Between Kickstarter and Indiegogo
Kickstarter and Indiegogo, two of the most popular crowdfunding platforms, may look the same, but you can find something different in detail.
Kickstarter, with its impressive track record of raising over seven billion dollars for crowdfunding campaigns by March 2023, stands out as a powerhouse, particularly favored by creatives in fields such as film, music, and art. This platform has a knack for drawing in projects that captivate and inspire, supported by a community eager to see such innovations come to life.
On the flip side, Indiegogo introduces a game-changing twist with its flexible funding model. This approach allows campaigners to retain their raised funds even if they fall short of their initial goals, offering a safety net that is especially beneficial for projects that might struggle to find their footing or reach a wide audience. Furthermore, Indiegogo has carved out a niche for itself in the tech world, attracting projects that cater to more niche or specialized markets.
Here are some differences between Kickstarter and Indiegogo:
Kickstarter, with its impressive track record of raising over seven billion dollars for crowdfunding campaigns by March 2023, stands out as a powerhouse, particularly favored by creatives in fields such as film, music, and art. This platform has a knack for drawing in projects that captivate and inspire, supported by a community eager to see such innovations come to life.
On the flip side, Indiegogo introduces a game-changing twist with its flexible funding model. This approach allows campaigners to retain their raised funds even if they fall short of their initial goals, offering a safety net that is especially beneficial for projects that might struggle to find their footing or reach a wide audience. Furthermore, Indiegogo has carved out a niche for itself in the tech world, attracting projects that cater to more niche or specialized markets.
Here are some differences between Kickstarter and Indiegogo:
Funding Model
As we mentioned above, Kickstarter leverages an All-or-Nothing funding model, while Indiegogoe owns both flexed and flexible funding model.All-or-Nothing Funding Model: The All-or-Nothing funding model on Kickstarter means that a project must hit its funding goal to receive any money. If the goal is met or surpassed by the deadline, the project gets funded. If not, no money changes hands; backers aren't charged, and creators get nothing. The All-or-Nothing funding model creates urgency, ensures backers only pay for projects that have enough support to succeed and helps validate the project's demand. The All-or-Nothing funding model requires creators to set realistic goals and actively engage with their audience, but it also protects them from overcommitting if they don't receive enough funds.
Fixed and Flexible Funding Model: The fixed part is similar to the All-or-Nothing funding model of Kickstarter. Moreover, the Fixed and Flexible Funding Model also allows creators to keep all the funds they raise, regardless of whether they meet their funding goal. This means even if the campaign falls short of its target, the creator still receives the funds raised, minus Indiegogo’s fees. Flexible Funding is suited for projects that can adjust their scale or scope based on the amount of funding received, offering a level of flexibility and security for creators to proceed with their projects with whatever funds they have raised.
Platform Size
Until 7th March 2024, more than 254,679 projects were successfully on Kickstarter with over $7 billion funded, while 650k+ projects raised $1 billion on Indiegogo.
But that does not mean which one is the better crowdfunding platform.
But that does not mean which one is the better crowdfunding platform.
Project Registration
Kickstarter has a stringent project registration process. Creators must meet specific eligibility requirements based on their location, age, and financial accounts. Additionally, each project undergoes a review process to ensure it fits within Kickstarter's guidelines and categories. This can include checks for originality, creativity, and compliance with the platform's rules. Kickstarter’s approach is designed to maintain a certain quality and type of project, which aligns with its community expectations and funding model.
Kickstarter has specific guidelines for launching projects on its platform, including:
- Projects must offer something to share or produce (personal projects without a shareable product or concept are not permitted).
- Charity or fundraising for causes is not allowed.
- Creators need to have a working prototype of the product they're campaigning for.
- Offering equity in exchange for funding is prohibited.
To be eligible to start a project on Kickstarter, you must meet the following criteria:
- You must be at least 18 years old.
- You must create the project in your name or on behalf of a legal entity you are part of.
- You need to have a physical address, bank account, and government-issued ID in the country from which you're launching the project. This means you cannot pretend to be in one of the 22 eligible countries if you're not.
- You must possess a credit or debit card.
- You must be eligible to use Stripe, Kickstarter's payment processor.
Indiegogo offers a more flexible project registration process. While it also has guidelines and rules for campaigns, it is generally perceived as more inclusive, allowing a wider range of projects and campaign types, including nonprofit or charitable causes, personal finance, and more niche projects. Indiegogo’s Flexible Funding option is available to almost any project, including those that might not meet the stricter criteria of Kickstarter. This inclusivity is part of Indiegogo’s appeal, making it accessible to a broader array of creators worldwide.
Kickstarter has specific guidelines for launching projects on its platform, including:
- Projects must offer something to share or produce (personal projects without a shareable product or concept are not permitted).
- Charity or fundraising for causes is not allowed.
- Creators need to have a working prototype of the product they're campaigning for.
- Offering equity in exchange for funding is prohibited.
To be eligible to start a project on Kickstarter, you must meet the following criteria:
- You must be at least 18 years old.
- You must create the project in your name or on behalf of a legal entity you are part of.
- You need to have a physical address, bank account, and government-issued ID in the country from which you're launching the project. This means you cannot pretend to be in one of the 22 eligible countries if you're not.
- You must possess a credit or debit card.
- You must be eligible to use Stripe, Kickstarter's payment processor.
Indiegogo offers a more flexible project registration process. While it also has guidelines and rules for campaigns, it is generally perceived as more inclusive, allowing a wider range of projects and campaign types, including nonprofit or charitable causes, personal finance, and more niche projects. Indiegogo’s Flexible Funding option is available to almost any project, including those that might not meet the stricter criteria of Kickstarter. This inclusivity is part of Indiegogo’s appeal, making it accessible to a broader array of creators worldwide.
Fee Structure
|
|
Kickstarter
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Indiegogo
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Setup Fee
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5%
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5%
|
|
Payment Processing Fee
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3%+0.2c
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3%+0.3c
|
|
Cost of Successful Project
|
A 5% fee on the total funds raised, and a modest fee per pledge
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A 4% fee on the total funds raised, and a modest fee per pledge
|
|
Cost of Unsuccessful Project
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Free
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9% of funds raised if flexible
|
Popular Category
Kickstarter: Technology, design, and games are the most 3 popular categories on Kickstarter.Indiegogo: On Indiegogo, the popular categories include technology and innovation, creative works, and community projects.
Success Rate
In 2023, the success rates of Kickstarter and Indiegogo are 40% and 9% respectively. But it does not mean Kickstarter is the better platform, because there are about 10% of projects never receive a pledge, while you can collect all the pledged funds even if you do not reach the goal on Indiegogo.4. Which One Is Better?
Kickstarter and Indiegogo offer robust platforms for crowdfunding, each with unique advantages and suited to different types of projects and goals. The choice between them boils down to what aligns best with your project's needs, whether that be the structured, goal-oriented approach of Kickstarter or the flexible, perhaps more forgiving, platform of Indiegogo.5. Related Readings
1.Kickstarter VS Indiegogo: How to Choose A Crowdfunding Platform
2. 5 Steps To Set An Ideal Funding Goal For Your Crowdfunding Campaign
3. Crowdfunding Fulfillment: Why Fulfillment Is Important For Your Crowdfunding Campaign
4. What Is Upselling In Crowdfunding?
6. FAQs about Kickstarter vs Indiegogo
1. Can I run a campaign on both Kickstarter and Indiegogo?
Running simultaneous campaigns is generally frowned upon, as it can dilute your efforts and confuse backers. However, transitioning from Kickstarter to Indiegogo for an InDemand campaign post-success is a common strategy.2. What happens if I don’t meet my funding goal on Kickstarter?
If your campaign falls short, no funds are exchanged. It's a tough pill to swallow but also an opportunity to reassess and refine your project for a future attempt.3. How long should my crowdfunding campaign last?
The sweet spot is typically 30 to 45 days. Short enough to create urgency, yet long enough to build momentum and reach potential backers.4. Can I change my funding goal mid-campaign?
Once your campaign is live, your funding goal is locked in. This emphasizes the importance of setting a realistic target from the get-go.5. Are there any hidden fees I should be aware of?
Beyond the platform and payment processing fees, there shouldn’t be surprises. However, consider the cost of fulfilling rewards and taxes, which can impact your net funding.
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