CROWDFUNDING AT A GLANCE: WHAT IT IS, WHAT IT'S NOT AND WHY
The following is excerpted from Kickstarter for Filmmakers, an ebook written by James Cooper, a Toronto-based director who used Kickstarter to raise $21,000 for his short film Elijah the Prophet last November.
What Crowd Funding Is
Crowd funding is fund raising. It’s as simple as that, except when it isn’t. With traditional fund raising, you basically go around hat-in-hand hoping people will donate money to your cause/project, crowd funding is the formal act of hosting a fund raising campaign with a specific dollar figure in place as a goal, and a specific timeline in which to raise said goal. With Kickstarter, you must hit your financial goal within the timeline you set, or you get none of the funds raised. Several other crowd funding platforms follow this model, but some allow you to keep the money regardless of how much you raise. Indiegogo, another popular platform, gives you the option of both campaign types.
In the case of Kickstarter, backers are not charged for their pledge unless you hit your goal. If successful, Kickstarter takes a small percentage of your earnings. There are processing fees incurred for each transaction, which add up to approximately 7%. Be sure to consider that when setting your goal.
What Crowd Funding Isn’t
Crowd funding is not free money. Too many crowd funding hopefuls see other successful campaigns and begin to dream of dollar signs, assuming success is easy to duplicate and that the money raised is easy to come by. Not so. According to statistics released by Kickstarter in January of 2011, only 46% of all campaigns launched actually succeed. Of those that fail, many do not receive a single pledge.
There are many reasons that lead to a campaign’s failure, including poorly executed descriptions of the project, unrealistic financial goals, lack of outreach and more. Don’t sweat it, though. I’m going to wade through everything and help you come out the other side, ready to launch a well prepared campaign.
If you’re doing it right, building a great crowd funding campaign won’t be easy. A lot of hard work goes into building a campaign and the strategy around it. Like any other aspect of filmmaking, crowd funding success rarely comes by accident, and is oftentimes the result of many late nights of preparation.
To keep the analogy going, the life cycle of a crowd funding campaign is very similar to that of the film you’re trying to raise money for, and to that effect, can be broken up into three key stages:
Mirroring a film’s pre-production, development is where the majority of your time will be spent. This is where you (and hopefully your team) brain storm ideas on how to build the campaign, what details to include, how to stagger rewards, campaign length, etc. It is, like pre-production, the most crucial stage in ensuring your campaign’s success. Without a well developed campaign, you are surely headed for rough seas.
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Live Campaign (Production)
Like being on-set, once the campaign goes live, there is plenty of stress and “hurry up and wait” to be had, but if you’ve done your job properly during the development phase, at this point you should just be executing the plan. It’s exciting watching the pledges stack up, but try not to freak out on the slower days. Breathe. You’ve done your homework, you know what to expect.
Reward Fulfillment/Updates (Post-Production)
Should your campaign end in success, you’re then responsible for delivering on all the rewards you promised everyone who pledged. This may require you to email things to backers, or (gasp!) use snail mail to send packages. Those who under estimate the extra commitment this stage requires will find themselves either swamped with extra unexpected work or with numerous angry emails/phone calls from backers when you fail to deliver the goods.
For more information on crowd funding and to purchase Kickstarter for Filmmakers, visit Kickstarterforfilmmakers.com!
Dropping out after a short stint at Toronto Film School in 2008, James pursued more pragmatic methods for developing his style and expanding his understanding of film language: making films.
After successfully funding his short film Elijah the Prophet through popular crowd funding website Kickstarter, James began compiling his experience into Kickstarter for Filmmakers, an inexpensive ebook guide to assist his peers in planning campaigns of their own. Find him on Twitter: @cooper_jim and online at James-Cooper.ca. James was also featured on Ted Hope's Truly Free Film.