Kickstarter and Indiegogo, considered the two most popular donation-based crowdfunding sites, were founded in 2009 and 2007 respectively. They give people and creative projects the opportunity to raise money via online donations or pre-purchasing of products or experiences. Which is best for your project? Based on feedback from our community members, it really boils down into two things: are you outside the US? Then probably best to go with Indiegogo. Are you based on the USA and going a creative/art/DIY type of project? Then probably best to go with Kickstarter. Everything else depends on a million independent variables, so lets look at the stats instead:
Average crowdfunding campaign: $5,000
Percentage of failed campaigns: 56%
According to Kickstarter, only 10% of projects end having received no pledges, while “81% of projects that raised more than 20% of their goal were successfully funded.” Projects may run for 60 days, though Kickstarter recommends setting a deadline for 30 days or less.
In terms of fees, Kickstarter applies a 5% fee for successfully funded projects, while failed projects incur no fees but are subject to an all-or-nothing policy- which is is exactly what it sounds like; if a project fails to meet its funding goal, none of the donation commitments made are actually processed. According to Kickstarter, this policy ensures a level of security for project creators and backers.
Meanwhile, Indiegogo has much looser guidelines. They essentially allow for the crowdfunding of anything – projects, trips, charities, and personal wishes. Unlike Kickstarter, Indiegogo does not curate campaigns or place restrictions on project creators. Anyone with an idea, a financial need, and a valid bank account may create a campaign. Indiegogo also offers more choices when it comes to raising funds by offering Fixed Funding and Flexible Funding campaigns.
Average crowdfunding campaign: $3,700 (source)
Percentage of failed campaigns: 80% (source)
On average, successful Indiegogo campaigns remain open for 47 days. According to statistics provided by a recent report published by The Verge, 80% of Indiegogo projects fail to raise more than 25% of the total goal. However, the site applies a 4% fee to the funds raised for successful projects, making it a slightly cheaper alternative to Kickstarter.
While the success rate of projects on Indiegogo may be daunting, many users choose Indiegogo for its choice of Fixed Funding or Flexible Funding options. Flexible Funding allows creators to keep the funds they have raised, for a 9% fee, even if the project is ultimately unsuccessful. However, creators are held accountable for delivering all promised donation perks.
Unsuccessful Fixed Funding campaigns are not charged any fees, creators are not required to fulfill any donation perks, and all contributions are returned. Although Indiegogo is coming in second to Kickstarter, its staying power, global audience, and inclusive policies have proven a great option for project creators searching for more flexibility.
Which did you choose?