your small business thinks it has the next great idea, but you need
some funding to get the project off the ground, Kickstarter might be for
is a crowd-funding website that lets entrepreneurs and business owners
showcase their next great product and convince customers to buy into it.
Of course, by essentially investing in the project, the customers, or
kickstarters, receive everything from a thank you from the inventor for
low contributions and the product itself for higher contributions.
Think of the television show Shark Tank, except the only investors you have to impress are actual customers.
recently released some statistics showing how effective crowd-funding
on the site really is. To day, the New York-based company has received
pledges of $261 million off 60,786 projects. Of those 60,000+ projects,
44 percent have been successfully funded, meaning the entrepreneur
reached his or her goal going into the process.
“We’re big fans
of numbers here at Kickstarter and we’ve shared many Kickstarter stats
and trends on this blog,” co-founder Yancey Strickler wrote on the
company’s blog. “Those posts have typically been tied to milestones, but
we’ve always wanted a way to share our numbers consistently.”
site is now pledging more transparency to help the public understand
how effective of a tool it can be for small businesses and
Projects on Kickstarter range from technology to
design to music endeavors. There are thousands currently on the site
waiting for support. If a project doesn’t meet its funding goal, all of
the money is returned to the investor.
is Kickstarter a great solution for your small business? Well if you
have a project that you’ve been tooling around with that you think could
really hit it big, Kickstarter could be a great way to receive funding.
Kickstarter has a really strong online community. People that invest
have a sense of pride in not only putting their money into what they
feel is a great product, but also helping an entrepreneur along the way.
community feels compelled to tell their social networks about the
project, heightening the awareness even more. Kickstarter is essentially
a social network. Project creators send updates to their investors and
investors can easily communicate with the creator.
example of Kickstarter’s success omes from entrepreneur Julia Hu, who
presented her invention – a vibrating wristband alarm clock – to a group
of Silicon Valley investors. After her presentation, the group was
stunned. “I mean, is this a company,” one of the investors said.
Determined to get this product off the ground, Hu went to Kickstarter
and nine months later, her product was retail-ready. It was impressive
enough to be carried in the Apple Store.
“I heard tons of ‘no’s,”
Hu told CNN Money. “The biggest challenge for a hardware company is,
unlike a software company, it takes so much more money and time to
validate a hypothesis. In terms of an investment decision, it’s just a
very different one.”
Hu added that Kickstarter is essentially a
large pre-order list for your product. If customers want it, they’re
going to get it and the business is going to truly gain some traction.