Kickstarter, a public benefit corporation based in Brooklyn, was started in the year 2009 to give wings to creative dreams. How does Kickstarter make money? It takes 5% of the total money funded for a project. How do backers make money on Kickstarter? What are the various fields in which you can submit your Kickstarter ideas and request for funding of the same? Keep reading to get answers to these questions and more.
How does Kickstarter make money?
Even before you know how does Kickstarter make money, you should know the basics of how does Kickstarter work for creators and investors. Kickstarter is a crowdfunding site that makes creative dreams a possibility. You may have read many self-help books on how does setting goals lead to success. Inspired by these books, you may set a reasonable goal for yourself that you can achieve within a stipulated time.
What good is the goal without money to make it a reality? This is where you should get to know how does kickstart work for you. Let’s say you have a musical dream, which is a creative one. All you need to do is the following:
- Submit the project on Kickstarter
- Set up the maximum amount that you need for the project
- Decide the time by when you need the complete funding
- Decide how you want to reward the backers who are pledging for your project
In this bargain, are you thinking how does Kickstarter make money? The idea is simple. Kickstarter takes 5% of the total funded amount when a creator’s project has been fully funded by the backers. You may have this question in your mind – is Kickstarter safe?
We will discuss this later, but the best thing is that Kickstarter doesn’t collect any amount of the project isn’t funded completely. Now that you know how does Kickstarter make money, you should also know about what it does with this money.
The 3 to 5% payment that Kickstart collects for every completed project is the company’s profit. This charger comprises a flat 3% charge plus $0.20 for every pledge that a project gets. The flashcards available in the “how does Kickstarter gets its money quizlet” form gives you all the data in clear and concise terms.
How do backers make money on Kickstarter?
A backer is also known as an investor on Kickstarter. If you are interested in pledging for a particular project, you will also have the question in your mind – how does Kickstarter work for investors? Here is what you should know about the same:
You pledge for a particular project because it is close to your heart. So, if you are contributing to Kickstarter to earn money, you may not be very impressed. However, it doesn’t mean that you will get a negative answer when you ask the question, how does Kickstarter work for investors. Of course, it works, but in different ways!
As an investor or backer, you will quite a lot of goodies or tangible rewards from the creator of the projects. For example, if the project is about a new musical talent trying to release his first single, you will get the first audio copy of his song when he makes it, as a token of gratitude from him to you.
What are some of the categories of Kickstarter projects available currently?
Though it is a crowd-funding site, Kickstarter is different from its competitors, thanks to two main reasons. Firstly, it doesn’t involve projects in all categories. The ones that are available on Kickstarter currently are purely creative in nature. This includes fields like journalism, arts, crafts, photography, music, and theater-based fields.
Secondly, Kickstarter doesn’t treat its backers as investors. If you want to pledge for a project, you will have to agree for the tangible rewards as per the policies of Kickstarter. This company doesn’t pay backers anything in the form of equity. The founders, Perry Chin, Yancey Strickler, and Charles Adler, believed that a backer should pledge for a cause to help realize a creative dream and not to calculate how much of return he will get on his investment.
Kickstarter Rules that you have to follow
The five fundamental Kickstarter rules that backers and creators should know initially, before using the crowd-funding site:
- Every creator should submit a project that aims to create something that can be shared with others. The product should be tangible so that he can claim that it has been created with the help of the fund collected from the site.
- All projects should have integrity and honesty in them. As a creator, you should be able to show your backers a prototype or demonstration of what you are going to create by a specific deadline. You shouldn’t mislead them with unreasonable information.
- If you want to know how does Kickstarter make money, you should be well aware of the rules. Currently, the site does fundraising campaigns for projects designed by creators. One cannot raise funds for charity purposes here.
- If you want to earn some money as part of your Kickstarter revenue source, you will not succeed. As a backer of a project, you can only pledge for a project for non-cash rewards. Kickstarter revenue sharing models and returns in the form of equity is not allowed.
- Kickstarter is quite strict on the projects that it accepts. Any project that claims to treat an illness, deals in gambling, deals in energy foods, offers alcohol and other illegal things for rewards, triggers violence, contains pornographic material or political content, deals with weapons, cash rewards and unlawful substances are prohibited.
Security aspect
Is Kickstarter Safe – this is the most common question in the minds of the creator and the backer. The backer, especially, has to think twice because he is the one who is putting his hard-earned money in a project that is close to his heart. However, you can rest assured that Kickstarter and its payment partner, Stripe are very particular when it comes to security and confidentiality of clients’ data.
Conclusion:
If you are looking for quick information on the modus operandi of Kickstarter you can refer to the crisp flashcards on how does Kickstarter gets its money quizlet website. Before you get into the details of how does Kickstarter makes money, you have to familiarize yourself with these important terms in the glossary – project, funding goal, creator, backer, pledge and rewards. Once you get a feel of these terms, you will know how to work your way through on this crowdfunding site.
Frequently Asked Questions:
How much caffeine in a kickstart?
A can of Mountain Dew Kickstart contains 90 milligrams of caffeine per 16-ounce serving. This is about the same amount of caffeine as a standard cup of coffee. However, the caffeine content of Kickstart may vary by flavor, and it’s important to note that caffeine intake should be moderated and personalized to individual tolerance.
When does kickstarter charge?
Kickstarter uses an “all-or-nothing funding” system and charges backers’ credit cards only if the project reaches its funding goal by the end of the campaign. If the campaign is successful, Kickstarter will charge the backers’ credit cards shortly after the campaign ends. If the campaign is unsuccessful, backers will not be charged.
Hello, my name is Idammah, and I am the founder of Wolfionaire.com, a personal development, and finance blog focused on motivation, success, and wealth. I am obsessed with studying the world's wealthiest individuals and learning about their path to success. I believe anyone can achieve their financial goals with the right mindset and strategies, and I hope to inspire and empower my readers to pursue their own path to success.
