The 5 Phases of Using Kickstarter to Start a Business

 

using kickstarter to start a business

If you are looking to launch a product, one of the main hurdles you will face is finding the funds to pay for the materials and creation of your product. These expenses can be daunting and, when you talk about actually meeting production demand and the ability to enter the market, money is most often the main determining factor.

Sometimes, you just need a little financial boost to get the ball rolling and that’s where platforms like Kickstarter come in to help you launch your business.

Kickstarter is also a great way to test your audience and see how they respond to your product and it helps advertise your product!

Here’s our phase-by-phase guide on using Kickstarter to start a business:

Using Kickstarter to Start a Business

Asses the situation
When you raise funds on Kickstarter, you have to reach your funding goal or exceed it. If you don’t meet the goal, you can’t cash out any of the existing funding. So, you need to make sure you have the time and skills it will take to promote your campaign.

Do some research
In order to get in the right frame of mind and to understand what is generally required for a Kickstarter campaign, you should perform a bit of research by taking a look at existing Kickstarter campaign. Take notes on what you like and don’t like about the campaigns that you see.

Using Kickstarter to Start a Business

Kickstarter is best for launching specific products or ideas
It’s important that the focus of your campaign is on getting funding to bring specific ideas to life. This means that you should focus on raising money to make your ideas tangible vs. sending out a general appeal for money so you can start your business. The Kickstarter team actually won’t approve anything that doesn’t follow the product-funding model.

Remember that your project should genuinely benefit the audience and the highest funded projects usually have a broad fit with the market, are somewhat innovative, and are low-priced.

Set a realistic funding goal
The average project on Kickstarter raises less than $10,000, with popular and average pledge amounts at less than $100 each. Don’t get carried away, thinking you will easily be able to raise thousands.

Calculate exactly what you need to bring your project to life. Don’t forget to factor in all materials and time, plus the creation and shipping of rewards. Aim high, but don’t dream too big. You can always start smaller with this funding round and then scale up once you understand how to run a successful campaign.

Also, remember that you will have to pay taxes on the money you raise, plus Kickstarter places a 5% fee on all funds raised on the platform.

Select rewards thoughtfully
With Kickstarter, donations are given in exchange for rewards and, essentially, donors should feel that the price (donation) they pay for the product (reward) is a win-win.

You’ll need to offer multiple rewards that gradually scale upwards in price. The price points should help you cover a range of what people are able and willing to give. Make sure the “cheap” rewards are appealing and don’t give too many reward options because it might overwhelm potential donors.

Also, make sure the different donation levels aren’t simple (don’t over-complicate with too many features or elements).

30-day campaigns perform better than longer ones
You might be thinking about setting up a long campaign to make more money, but think again. 30-day campaigns are more likely to meet their fundraising goals.

Create killer content (copy +photos)
The copy and images that accompany your campaign will require time and effort. Make every word count and, unless you are already assured that your own photography skills are high quality, invest in good photography.

With your content, you should be specific about where the money is going and make sure that you are the face of the campaign. People will be more willing to donate if they know the cause is genuine. The story that you tell with your content is crucial. You are not only selling the product, you are selling your story.

Always provide and email address where donors can contact your with issues or questions.

Create a high-quality video
Campaigns that feature video are more likely to get funding, but not just any ol’ video made with an iPhone and iMovie will do. The quality of the video is very important. If you can’t accomplish quality on your own, you might think of hiring someone to do it for you. Keep in mind that this can get expensive.

There are some simple solutions, like using b-roll footage and speaking over it so it’s easy to edit. If you have a high quality camera to get photos or bits of video footage of the product be used or made, you can easily mix this in with the b-roll, capture audio with a solid mic and audio app, and edit based on the techniques you found in your research on existing Kickstarter campaigns.

Remember to keep your video short -less than 3 minutes. People have short attention spans and you want to engage them with your story quickly so they’ll click on that donate button.

Remember to cover these elements through the storytelling in your video: who you are, what your product is, the problem your product solves, and why you need their help.

Get Organized
There are a lot of elements to keep track of when you launch a Kickstarter campaign. We recommend creating a shared file of important dates and promotional activities and sharing it with your team.

Using Kickstarter to Start a Business

Leverage your network
When it comes to raising funds on Kickstarter, the larger your network, the better. I’m talking friends, family, and your email list (see below).

Don’t expect to simply set up a campaign and watch the money roll in. It just doesn’t work that way. Sure, you might get a few random strangers who stumble upon your campaign and donate, but you’ll have to tap your network and promote heavily for the most of the funding you receive. Don’t forget to reach out to your fans on social media to ask them to contribute.

Make sure you reach out to personal contacts before the campaign launches, get them to agree to donate, and have them donate as soon as it goes live. Having your project partially funded will have a positive impact on the strangers that come across your campaign.

Build a list BEFORE you launch your campaign
You’re going to need to build some momentum before you launch your campaign. Set up a landing page and collect emails so that, when your campaign goes live, you already have an email list of people who have shown interest in your product.

Invest in PR
PR is a great way to boost the visibility of your campaign and get more potential donors to your campaign page. Get featured in blogs and publications in order to reach more strangers’ eyeballs. You can accomplish this this by sending out a press release to relevant publications, blogs, and media outlets.

Remember that your time and cash are limited. The whole point of the campaign is to fund the underfunded, so don’t go after every single press contact. Pick 2 to 3 that are most relevant to the target market that would buy your product and reach out to them.

Use Google Analytics
Kickstarter provides some analytics for your campaign, but nothing the depth that Google Analytics can provide. You’ll be able to see who visits your page, how long they are they, where they are from, etc.

Using Kickstarter to Start a Business

Update your supporters
Create blog posts and videos to keep them in the know. Always be upfront about anything that isn’t going according to plan (shipping dates, etc.). Don’t send mass messages, but reach out to people directly instead. You can also update contributors by using the Project Updates section of your campaign page.

Analyze
Pay attention to your analytics daily on both Kickstarter and Google Analytics. Notice your top three traffic referral sources and zero in on promoting your campaign there.

Continue to tap your network
Forget about how uncomfortable it makes you feel and ask your network to support your fundraising campaign. If you don’t ask, people don’t know to give.

Connect with your backers
After receiving donations, make a special effort to really connect with those backers and get to know them. Create fans for life.

Using Kickstarter to Start a Business

Send out rewards as promised
Make sure the delivery of rewards is timely by following through on the promises you made during your campaign. If something is keeping you from delivering on time, be communicative and honest with your backers.

Go the extra mile
Include thank-you notes in your packages and make sure that your packaging is attractive and well put together. Create a lasting impression with your backers so they’ll help with word-of-mouth and purchase more in the future.

Something you might consider doing is creating a VIP club through either an email list or private Facebook group, where backers continue to get access to exclusive discounts and updates.

Get additional feedback
Since you now have a base of individuals that have used your product, get in touch with them to get feedback on their experience using your product. This will help you determine any changes that should be made, points of emphasis for marketing, etc.

Wrap up
Make notes about what went right and what went wrong with the campaign, what you would do differently in the future, what promotional tactics worked, etc. You can use these ideas in your next campaign.