-
Kickstarter: A Guide and Checklist (Advice)
Kickstarter for Writers
Bulleted Guide and Checklist
TERMS:
(It should be noted that while these are all required to be known and used by Project Owners, most Backers don’t know or use them correctly, if at all.)
- Kickstarter: A campaign to raise funds for a creative project on Kickstarter.com. It is timed and may run up to 45 days.
- Project: The tangible product/s that will be produced with the funds raised by the Kickstarter. Projects must have a tangible result. Projects are NOT expected to be produced until the Kickstarter ends. Backers can get confused about this.
- Project Owner/Creator: The person who will be producing the project (e.g., you).
- Goal: The project must decide/announce how much money is required to produce the project to be raised. If the Kickstarter does not raise enough funds to cover that goal, it fails and backers don’t pay, and the Project Owner doesn’t receive a cent or owe Kickstarter.com. If the Kickstarter reaches its goal, the Project Owner receive the funds (less Kickstarter.com’s fees) and the Project Owner is legally required to produce the project or be at risk of prosecution for fraud.
- Pledge: The money a Backer promises a Kickstarter.
- Funds: The money a Backer pays a Kickstarter. Backers are not charged until the Kickstarter’s deadline is over. Sometimes Backer’s card decline payment at that time for various reasons.
- Backer: A person who pledges funds to a Kickstarter to help the creative project become reality. They can receive amnestying emotional reward (e.g., thanks and credit) and/or a tangible reward for their funds. Note: The tangible rewards are the ones most Backers desire – and that can lead them to mistake themselves as being “Customers” who bought something from you. Never refer to Backers as Customers. It can get you into trouble both with them and tax-wise.
- Reward: Anything a Backer receives in exchange for the Funds they give to a Kickstarter. Backers often treat these are products they purchased and may think their Reward will be shipping when the Kickstarter ends, when it may really take months to produce. This makes it critical for the Project Owner to communicate regularly and clearly with Backers to alleviate their concerns.
- Reward Levels: To provide Backers with an easy experience, Kickstarters allow Project Owners to assign specific Pledge Amounts with preset Rewards. (e.g., $10 earns 1 book. $20 earns 3 books, etc.)
- Stretch Goal: Once a Kickstarter has reached it’s Goal, a Project Owner may encourage backers to increase pledges by adding a new “unofficial” goal, promising various things if that new Stretch Goal is reached.* Examples include: improvements to the project, improved rewards, additional rewards, options to existing rewards, social rewards, media rewards, etc. (e.g., “Goal of $1,000 produces 100 books. If it reaches $2,000 the book will be hardcover. If it reaches $3,000, every backer gets a bookmark, etc.)
- Add-On: After the Kickstarter is over, Backers may be allowed to pay for additional rewards not automatically set in the level they originally chose. These items are added-on later and those funds must be retrieved outside of the Kickstarter.com. (e.g., PayPal, BackerKit, Zelle, etc.)
BEGINNING:
What is the Kickstarter’s Purpose?
- Funding?
- Profit?
- Marketing?
- Any combination of the other 3?
Funding: Earn funds to produce the project. Profit may come from sales of the project outside of the Kickstarter.
Profit: Earn more funds than the product requires. This may mean the project is exclusive to Kickstarter Backers. This can work as a model to energize a fanbase.
Marketing: Attract/Energize product’s fanbase (to upsell to outside of the kickstarter itself). This only works when there are other channels in place to profit from one’s fan-base.
BUDGETING:
Once you know what it’s for, decide how much you need.
Think of your Kickstarter GROSS INCOME as these variables:
- Production Cost
- Fulfillment Cost
- Services
- Labor
- Marketing
- Investment
- Net Profit
Production Cost: How much you will spend to produce the project. Include all your labor and supplies, your vendor costs, and every single “add-on” and “stretch goals”.
Remember that if you add a stretch goal to give every an enamel pin (for example), you may only have 20 backers, but will have to order at least 100 pins (manufacturers will usually not make less than this). So 100 pins at $3 each in $300. But 20 backers paying $10 each is only $200.
Fulfillment Cost: Every box, every envelope, every roll of tape, every label, paper, printer ink, and the actual shipping costs (including tracking, signature required.
Remember that if you reach enamel pins as a stretch goal, that will require all the following: Extra weight, extra shipping supplies, extra labor, AND if you are shipping books it will change your shipping rate entirely. You cannot mail enamel pins as “Media Mail” – so you’re $2 shipment just jumped to $6.
Services: Kickstarter takes around 4-8%. If you use a third party fulfillment processor (like BackerKit) you will pay an additional % and maybe a per transaction fee (but the idea is that it helps you upset your backers which earn you more). And don’t forget about an e-mail management services like MailChimp or Mad Mimi.
Labor: Every hour you spend on it is billable time, every hour of every person you hire to help, plus pizza and snacks for friends and family “fulfillment parties”. You may be required to pay taxes on some labor.
Marketing: How much are you going to spend to promote and support it? You can pay for advertising – but that might not work. When it comes to marketing – you’re primary cost will be labor. You will be constantly interacting with your fans and backers to promote it instead of doing cool stuff like writing or arting. And you might need to hire contractors to help. Artists and videographers, for example. Depending on your project, that could be anywhere from free to tens of thousands of dollars.
Investment: You may have had help getting the Kickstarter started. Maybe a loan or a float. Maybe just help from friends and fam. Make sure you set aside enough to repay them. Default on a loan is bad – but forgetting your friends can be worse.
Net Profit: Yay! Fun stuff. This is what you’ll pay taxes on, BTW. As long as you kept good records of everything else, you’ll be fine.
Use a Sharp Pencil. That’s not software. That’s geezer-speak for make sure your numbers are as perfect as possible. It is very easy to lose money.
Get quotes from every vendor on everything/one you need in advance. Keep those handy to refer to at all times.
You will never know how many backers you will have in advance or how much funds you will receive. You have to plan on balancing it. Sometimes the Gross Income will hit thresholds that will reduce your net profit as backers suddenly incur costs (e.g., stretch goals, add-ons, labor, etc.). In the smallest example, each time you make a video for your fans thanking them, it takes your time to produce (plus maybe editing). In the most complicated (and common) example, if you reach a stretch goal promising a new product – that new product incurs it’s minimum production costs, fulfillment costs, shipping, and marketing (meaning, all of the announcements and artwork showing off that new product to backers).
Spreadsheets are your Friends
Calculate your Expenses as tightly as possible with multiple assumptions. How much will it cost if you don’t fund at all? Did you set your Goal appropriately? How much will be gained if it only reaches its Goal? How much do you REALLY need over your Goal to be effective/profitable? Will your Stretch Goal funds actually cover all of the costs associated with it? How much will you REALLY earn after each Stretch Goal is met?
Some Project Owners may only ask for XX% of their requirement because they are afraid the full amount required will scare away new backers who doubt it will succeed. They then intend the project to “go viral” and once it funds lower, other backers will get excited that’s really going to be made and pile funds on top of it to reach and even exceed their actual Goal. They may even do the same for each Stretch Goal. Never do this. If one fails to produce their project, they have committed fraud. Kickstarter.com and Backers will not leave it alone.
PLANNING:
Timelime: Get timelines from every single one of your vendors. Maybe not exact dates – but timelines. Float them and pad them. Your Backers will demand a deadline for you complete YOUR work and another as the delivery date for their Rewards. They will be understanding to a point, as long as you communicate with them regularly (e.g., Updates and direct Messages).
Goal: Ask for enough to at least zero-out and give you product in your hands.
Stretch Goals: There are two kinds of Stretch Goals. Pledge and Media Goals. Offering project improvements upon raising more funds is the most common. However, offering project improvement upon social media measures (e.g., shares, likes, links, tweets, etc.) are also valid – especially because it encourages viral marketing that should convert into additional pledges. Alternate tangible with intangible improvements to improve the Backer Experience. Tangible can mean physical improvements and options to the project. Intangible can mean a thank you video. Use your imagination. Note: While the ideal is that Backers will follow the campaign as it progresses to upgrade their pledges as improvements are added – the majority just pledges and forgets. Find a way to upsell improvements as add-ons after the Kickstarter closes.
Reward Levels: Set up basic Reward Levels at marketing friendly ROUND numbers. Do NOT use the $0.99, $9.99, $19.99 tricks retail does. It wrongly enforces to people that’s its a retail purchase. Also, true backers don’t appreciate it. They want to think of themselves as Emotional Investors and round numbers help them do that.
My Recommendation: The best numbers we found works are $1, 5, 10, 12, 15, 20, 25, 40, 50, 60, 65, 79, 95, 125, 150, 175, 200, 225, 330, 450, 600, 900, 4000, 8000, 10000. $10,000 is the maximum pledge allowed (Federally mandated). Anything after $900 reaches an audience to whom the money itself doesn’t matter.
Shipping Rates
Kickstarter gives you two choices: Enter flat rate for each country/region per “Reward Level” or make it very clear that the level does not include shipping at all, and backers will be required to pay shipping later after all their rewards have been calculated.
Weigh everything in advance. Download the PDFs of rates from USPS.gov and other shippers. Buy a digital shipping scale.
Get an account with a shipping label processor. Yes, you can use USPS.gov, but their are others that manage USPS, UPS, FEDEX, DHL, etc. all in one place and also give discounts. Not all of them process Media Mail, though. We use GoShippo but I have no reason to recommend them over others. It didn’t do Media Mail last time I checked.
Every “stretch goal” and “add-on” changes the packaging, weight, and maybe even the shipping rate.
Adding anything into a package with a book negates Medial Mail. For example, you cannot mail enamel pins as “Media Mail” – so you’re $2 shipment just jumped to $6.
Another issue is stretch goals and add-ons may have incompatible sizes and dimensions to the original project. We ran a Kickstarter for an art print on fine paper. We used to ship them flat until we used stretch goals to earn enamel pins…which damaged the prints in flat envelopes. So we changed to tubes…but then we offered a book as an add-on…which can’t go in a tube OR flat with artwork. Suddenly we incurred over double the shipping cost. Oops.
My Recommendation: Include shipping into each reward level for DOMESTIC SHIPPING IN YOUR COUNTRY ONLY. Announce that international shipping will be calculated and charged separately when rewards are ready to go. International rates change frequently. Their thresholds are also…unique. A single $5 add-on can push a $22 shipment to $33.
KICKSTARTER TOOLS:
Kickstarter has built-in tools to help. They aren’t perfect but you MUST use them. You can always use others (should use others), but never use them instead of others.
Kickstarter Updates: A way to post and add updates to the Kickstarter. Backers may be e-mailed when a new one is posted, so it should be used to let them know when milestones are reached and improvements are being made (especially upsells and add-ons). They may be public or customized for Backers (even specific Reward Levels). Use them. A lot.
The Kickstarter Survey: Stupid name, but when a Kickstarter ends, the Project Owner must send a form to every backer. Sounds stupid at first until one realizes it’s the only way to learn the Backer’s name, shipping address, and contact information, to send them their rewards. Until they fill out the survey, you can only contact them through Kickstarter Messages (see below). Owners can customize the survey to collect almost any information, including info about options and add-ons. Backers hate the Survey. They don’t know what it is and sometimes ignore it. Some backers use “special” e-mail address like “Kickstarter-Filter@gmail” and never see it – or only check once every few months. Also, you may have to reconfigure your own mail-server to tell THEIR spam filter that the Survey is a legit e-mail and not to delete it. This has caused tons of headaches. The instructions are in the Help Guides. I had to call my own e-mail techs for them to walk me through it, too. Just bite the bullet and do it.
Kickstarter Messages: Kickstarter has their own internal messaging system that allows Owners and Backers to communicate. Owners should use it because if a Backer turns into a jerk, all that communication is easily referred to if Kickstarter’s admin gets involved. If everything is in Kickstarter, they can read it and resolve the issue fairly. If an owner has to claim outside e-mails and phone calls, Kickstarter may assume the Owner mismanaged the project and the Backer is automatically right. However, many Backers don’t know how to use it or don’t want to use it. Messages sent to a Backer are also sent by e-mail to them to notify them. Some backers use “special” e-mail address like “Kickstarter-Filter@gmail” and never see it – or only check once every few months. Backers will e-mail you, call you, and even post public “comments” on your Updates instead of using it. Be polite and make sure to never discuss anyone’s private information in any public forum.
Backer Report: When a Kickstarter is over, Backers who fill out their survey is collected and available as a Report. At the basic level, there is a page that lists each backer by name, how much they pledged/funded, if they’ve completed their survey, how many messages have been shared them them, and if their rewards have been shipped or not. Clicking on a name will reveal their contact info, the reward level they pledged for, and the results of their Survey. At the BEST level, an Owner can download all of the information as a spreadsheet. This is kind of mandatory.
THIRD-PARTY TOOLS:
There are web-sites, vendors, and services, that can help you process add-ons and fulfillment and shipping that are unaffiliated with Kickstarter.com.
Try them out in advance (they have free trials). BackerKit is a famous one – but not the only one. We are able to customize our Shopify store to do almost everything BackerKit does (and other things it can’t).
But they all require configuration. BackerKirt, for instance, requires you to configure every single product’s dimensions and weight and the box it gets shipped it and it’s weight, and your handling costs. The last time I used it – it didn’t even calculate the shipping rates for me – and I had to configure those in myself from a USPS rate chart (yuck). That may have been corrected. Competitor platforms may be better or worse. I don’t know.
Uline.com is the go to for shipping supplies. They are not the only game in town – but they are one of the largest, with the largest inventory and lowest rates. ClearBags.com is another good one for specialty products. SpecialtyStoreServices.com is another I’ve used for certain items. Your local office supply store may be too limited and expensive for a Kickstarter with a hundred or more backers.
FINISHING:
Now do this:
- Send an Update to everyone thanking them, being excited about being able to finish the project, and promising rewards will be shipped ASAP. Make sure to not OVER promise.
- Re-Estimate all your final costs (remember add-ons are still incalculable)
- Your funds will take 1-2 weeks to get. Remember, Kickstarter.com will take a percentage.
- Complete the project.
- Post regular updates through the process, showing everyone what you are doing and how. Be as transparent as possible. You don’t have to show receipts. Just show progress images and videos. This is extra important if you are running late. People following will be more understanding – they often appreciate seeing behind the scene of how a creative project is made.
- Organize and plan out the entire fulfillment process, including all your purchasing and labor.
- Only send the survey when you are close to fulfillment. People move. If you collect the survey in April and ship in October, they may have forgotten to tell you. When their rewards go missing – it will be up to you to correct it (customer service wise).
- Collect and manage the survey data. There will always be a percentage of Backers who make things difficult. Just laugh it off.
- Fulfill all Intangible Rewards.
- Collect all Tangible Rewards from Vendors.
- Process all add-ons.
- Ship all Tangible Rewards.
- Expect problems, but enjoy your success, no matter how “small”.
TIPS/TRICKS:
In the Survey, ask your Backer if they would allow you to put their contact information in your mailing list. Most will say yes. If they don’t, Kickstarter now requires you to delete their contact information from all of your devices. You can always contact them again through Kickstarter Messages – but the mailing list is your key to sell them in the future.
Use the Update feature of an older campaign to contact all of those Backers to tell them about your next campaign. This is a work-around for Backers who don’t want to be on the mailing list.
Always sound happy and excited about the project and the Backer’s assistance to “Bring it to life”.
————————————————————-
Lazarus Chernik<b style=”font-family: inherit; font-size: inherit;”>Questions/Corrections/Clarification Requests Welcome
This is a living document and may be corrected/updated over time. Forgive any typos and alert me if something is confusing or wrong. I wrote this in one pass. 😀
-
0 Replies
Sorry, there were no replies found.
Log in to reply.