Kickstarter to hit $300m this year?

Kickstarter to hit $300m this year?(venturebeat.com)

22 points by gbsi 14 years ago | 27 comments

ajays 14 years ago |

This is very cool. Kickstarter is the leading edge of a tectonic shift.

Quite often with these new ideas that come out of left field, the pendulum swings the other way after a certain point. While I like Kickstarter and other such projects (a lot of cool gizmos would not see the light of day were it not for Kickstarter), I fully expect the next year or so to be peppered with reports about fraud, etc. in the popular media.

It used to be that if you had a widget that you wanted built at scale, you had 2 options: mortgage the house (and bug the relatives for cash), or approach one of the big guys and beg them for help. With Kickstarter, you don't need the big guys anymore. And as with any other such change where the Old Guard gets sidetracked, expect them to fight back with scare stories and mockery.

olalonde 14 years ago | |

I completely agree. I predict there will be a "but think about the children" argument made for regulating Kickstarter within one year.

cienrak 14 years ago |

If they wanted to, Kickstarter could be one the biggest and best platform for startup crowd funding. They have the infrastructure to capture the promise of the JOBS act/ crowd funding act

citadrianne 14 years ago | |

They don't want to. That would detract too much from their ability to serve creatives.

bproper 14 years ago | | |

Entrepreneurs are creatives. it's no different than the pebble smartwatch or light table project, except you are offering stock in the company instead of physical rewards.

waterlesscloud 14 years ago |

I expect other players to come in for big name creatives. Maybe the Hollywood agencies, CAA for example. Or maybe the creatives themselves set up their own infrastructure.

Say Joss Whedon wanted to raise $10 million for a show. With Kickstarter he'd have to give them $500,000 of that, and it's not at all apparent that he would actually need them. If you had an agency roll this into existing services, maybe with a nominal fee, the big names may be more comfortable with that anyway...

jerf 14 years ago | |

"With Kickstarter [Joss Whedon]'d have to give them $500,000 of that, and it's not at all apparent that he would actually need them."

I'm not sure it was possible to pick a worse example. Dr. Horrible is quite possibly the Hollywood project most desperately calling out for fan funding that has ever actually been made, and it was still only made because he just put up the money and hoped for the best. Concrete evidence would suggest that he's not capable of raising millions of dollars from fans without some assistance, because if he could have, he would have then.

Using the Wasteland 2 average donation of call-it-$50 ($47.86), is $500,000 that excessive for coordinating and aggregating the donations of 200,000 people? That's not free. Joss can't avoid paying something for that service. Perhaps someday they'll move to taking a flat fee per donation, though that would also require Amazon and the other payment processors Kickstarter uses to go to flat fees too, which seems unlikely.

waterlesscloud 14 years ago | | |

That was 2008, an entirely different time. Crowdfunding barely existed as a concept and to my knowledge it was never Wedon's plan to pursue it.

I'll draw your attention to the fact that the big videogame kickstarters have been for franchises that have been dormant for decades. Surely their principals wanted to bring them back sooner. If they could raise this kind of money, why didn't they do it in 2008? The answer, of course, is that they couldn't do it in 2008. But they can in 2012. And Whedon could in 2012 as well.

goatforce5 14 years ago | |

I have no idea how the traditional Hollywood system works, but if Whedon raised $10m from a studio via an agent and, I dunno, a production house or something, how many middle men would get their fees from that $10m and what would it add up to?

bproper 14 years ago | | |

Joss Whedon might be able to raise the money on his own due to his exceptional internat fame, but for most indie producers, the incumbent system takes a way bigger slice of the pie than 5%.

waterlesscloud 14 years ago | | |

The traditional system would eat up a big chunk, as would agents. Whedon might be able to raise funds directly from a hedge fund or rich individual, that's what indie producers do when they can.

sycr 14 years ago | |

I think that you might be discounting the value of Kickstarter's execution - or rather, a hypothetical Joss Whedon would be discounting the value of their execution.

In the same way that Twitter is "just a database of SMS messages", Kickstarter is just a "payment checkout" - but of course they are both greater than the sum of their parts.

waterlesscloud 14 years ago | | |

They have value, of course. But I do think that on the upper end they might be forced to lower their percentage in time. If for no other reason than someone else will come along and compete at a lower rate.

Their execution isn't that hard to compete with, it can be commoditized with enough resources, and for someone with actual fame I don't think they increase the amount raised by much.

If not Whedon, think Lady Gaga or JK Rowling. What would Kickstarter offer them that some private white label processing service couldn't copy?

ScottBurson 14 years ago | | |

Right. What you have to look at is, how much more money would he bring in by using Kickstarter? Hard to say for sure, of course, but Kickstarter is in a very good position now to argue that it's well over 5%.

Seems to me that for someone who doesn't already have a large fan base, a Kickstarter campaign could easily increase their take by a factor of 4 (if not 10 or 100 or 1000). For someone well-known like Whedon the factor will be smaller, but if it's 1.5 or even 1.2, the 5% fee is more than covered.

shawnc 14 years ago | |

It's not apparent he would need Kickstarter - he could attempt a crowdfund straight through his own website, thus not giving anyone else a cut except whoever his payment provider is. He'd certainly drive enough traffic there, to not require any 'help' from Kickstarter.

jonursenbach 14 years ago |

Wonder how long until Kickstarter sheds its Amazon Payments dependency so they can keep a larger share of the pot.

draggnar 14 years ago | |

Wouldn't they have done that already? Maybe there is some partnership at work.

bizodo 14 years ago |

Very cool. Shows a new trend in social funding. And inadvertently provides proof of concept. Would like to see something like this for music industry.

bproper 14 years ago |

where is the data on this coming from?

ronnier 14 years ago |

Thank you for not posting as "$300mm"

cryptoz 14 years ago | |

Yeah, eh? What's that extra m for anyway?

ianterrell 14 years ago | | |

I think it has its roots in Roman numerals. i.e. MM = 1000*1000, or 1 million.

And regardless of whether you like it or not, it is the standard abbreviation in the financial world.