Reward-based crowdfunding platforms led by Kickstarter and Indiegogo have revolutionized the way entrepreneurs and innovators bring their ideas to life. Although both platforms began as platforms based on raising finance for arts projects, they soon expanded to include other leisure and business sectors. Today they enable individuals and startups to raise millions of dollars to fund their projects through pre-orders. This blog post takes a closer look at the Top 10 reward crowdfunding projects of all time on these two platforms, showcasing the incredible diversity and creativity that crowdfunding has unleashed.
A way in which rewards-based crowdfunding platforms have particularly transformed opportunities for entrepreneurs with new product ideas is to de-risk the all-important first production run. Careful calculations allow both entrepreneurs and established businesses to use an All-Or-Nothing method to set a minimum order level that they know will result in making a profit. They also receive customer payment in advance as a pre-order. If they don’t generate sufficient orders they simply don’t go ahead and money is returned to the backers. De-risking the production process helps bring more ideas and creations to the marketplace, satisfying early adopters and experimental consumers who are able to access new products.
The crowdfunding projects that everyone sees on-screen do not show the full amount of work that is required for crowdfunding to be successful. Think of it as the 10% of an iceberg that is visible above sea level. To generate over $1 million of pre-orders is definitely no easy matter, let alone more than $10 million which is what all the projects included in this article achieved.
Stats provided by Kickstarter show that under 41% of projects on its site succeed. Of those that have done, which number over 246,000, just 0.31% raised $1 million or more. Comparable data is not provided by Indiegogo. However, raising millions of dollars’ worth of pre-orders does not guarantee that goods will be completed and delivered. Many items are still at a development stage when crowdfunding campaigns generate pre-orders, with supply chains and production contracts still to be put in place. A lot can go wrong, particularly if the product creators have little business experience. It’s not like buying items from Amazon.
This article on the top ten crowdfunding projects on Kickstarter and Indiegogo first appeared on the BOLD Awards site, and here’s a link for you to continue reading: https://bold-awards.com/top-10-reward-crowdfunding-projects/