Many people avoid crowdfunding sites like Kickstarter because the proposition is an all-or-nothing offer. If you don’t reach your goal, then you don’t get any money on Kickstarter. That’s why other niche crowdfunding sites have changed their offer. You get to keep any of the money that you are able to raise. That, however, might not actually be a good thing. Here’s why.
It’s About Your Costs
You’ve budgeted a certain amount for your crowdfunding campaign because that’s what you need. Many crowdfunding campaigns are a rewards-based campaign that requires you to provide something of value to someone who contributes. This means that you will have costs associated with every backer that you have.
When you do not meet your goal, but still get the money that was pledged because of your promises, you’ve still got to follow through. If you do not, then you’re committing crowdfunding fraud! This means you’re stuck either eating additional costs that were unanticipated, releasing a weaker overall product, or having to re-work your budget.
You Can Raise More Money
Nothing helps to motivate someone like not getting anything. If you go all-in with your crowdfunding campaign, then you are 100% committed to getting your funding goals. You have to be. If you come up even $1 short, then all of the work that you’ve just put in for the last 60-90 days ends up going to waste. Who wants to work full-time for 3 months without a reward to show for it?
When a crowdfunding platform gives you whatever you raise, then it is very easy to just kick your feet back and accept your circumstances. You’re getting some cash. “We can raise the rest of the cash that we need on a future campaign,” you might tell yourself. There isn’t as much motivation to get success, which means you’re going to raise less money. All-in campaigns, on average, raise $31k. Keep it all campaigns raise less than $20k.
You Also Value Every Contribution
When you are in it to win it, then you become grateful for every contribution that comes your way. Even if that backer is only giving you $1, that’s one dollar closer to your goal. About 1 in 5 all-in crowdfunding campaigns offer backing levels at $1 and even though it might just be a simple note to say thanks, only 1 in 10 keep it all campaigns offer something similar.
It isn’t just an appreciation of the smaller contributors that comes when you’re all-in. There’s also a need to provide better, more comprehensive descriptions of what is being provided in rewards and what your end goals happen to be. Better documentation almost always results in better backer levels.
If you are willing to go all-in with your next crowdfunding venture, you might just find that you can exceed your budgetary goals. When you do that, you’ll be able to have financial security for your next project.
Strong proponent of individual liberty and free speech. My goal is to present information that expands our awareness of crucial issues and exposes the manufactured illusion of freedom that we are sold in America. Question everything because nothing is what it seems.