Kickstarter has been around for a little while and leverages social media or “crowd sourcing” to fund start-up projects. The premise behind the Kickstarter model is that an aspiring inventor or developer of a product or service pitches it in a video via Kickstarter. The video will usually provide details of why the project is being developed, the problems that it is intended to overcome and provide a demonstration of the project, at least in a mocked up form. The budding entrepreneur then sets a target amount of money they need to raise in order to get the project off the ground. This is where the “crowd sourcing” comes in. People (or entities) can pledge amounts of money to the project in return for (usually) the product when it is finally produced. There are different levels of pledges usually available, providing different levels of “reward”. Once the project reaches the level of funding pledges, within a set time period, the pledges are called in and production commences. Publicity for the project relies heavily on Social Media.
It is a new and interesting approach to financing projects and has had some incredible success stories. The latest is the Pebble Watch, which is a bluetooth enabled watch capable of connecting to your iPhone or Android smartphone. The initial aim was USD $100,000 within 45 days, however at last count the Kickstarter project had pledges exceeding USD $10,000,000.
Not all Kickstarter projects get funded however and the projects are not just restricted to “gadgets” like the Pebble Watch. Projects cover music, films, software, food, fashion and design.
For aspiring inventors or companies with great ideas but struggling to find capital investments, Kickstarter offers an alternate “crowd sourcing” option to realise your project.