Kickstarter

Definition

Kickstarter is a popular crowdfunding platform that allows creators to raise funds for their projects by soliciting small contributions from a large number of people, typically through the internet. It empowers individuals and teams to launch creative endeavors in various fields, including film, music, art, and technology, providing an alternative funding source beyond traditional methods like loans or investors.

5 Must Know Facts For Your Next Test

1. Kickstarter was launched in 2009 and has helped fund thousands of creative projects, making it one of the most recognized crowdfunding platforms globally.
2. Creators set a funding goal and deadline; if the goal is met or exceeded within the timeframe, they receive the funds; otherwise, no money changes hands.
3. Backers on Kickstarter often receive rewards based on their pledge level, such as early access to products, exclusive merchandise, or experiences related to the project.
4. The platform operates on an all-or-nothing funding model, which encourages creators to effectively market their projects to reach their goals.
5. Kickstarter has played a significant role in democratizing access to capital for creators, enabling innovative projects that might not have been funded through traditional channels.

Review Questions

• How does Kickstarter facilitate the funding process for creators and what impact does this have on the creative industry?
  • Kickstarter facilitates the funding process by allowing creators to present their projects to a global audience and collect small contributions from many backers. This model democratizes access to capital and empowers independent creators who may not have access to traditional funding sources. The impact on the creative industry is significant as it encourages innovation and diversity, allowing unique projects that reflect varied artistic expressions to come to life.
• Evaluate the effectiveness of Kickstarter's all-or-nothing funding model in promoting successful project launches.
  • The all-or-nothing funding model is effective because it motivates creators to actively engage potential backers and generate buzz around their projects. By requiring creators to meet their funding goal within a specified timeframe, it encourages them to market their ideas effectively. This system reduces financial risk for backers, knowing that funds will only be collected if the project is fully funded, which can lead to increased trust and engagement with the platform.
• Analyze how Kickstarter has transformed traditional financing avenues for creative projects and what challenges this poses for future creators.
  • Kickstarter has transformed traditional financing avenues by providing a platform where creators can directly engage with supporters, bypassing traditional gatekeepers like studios or investors. This has opened up opportunities for diverse voices and innovative ideas that might not have found backing otherwise. However, challenges include increased competition for attention among projects, the need for effective marketing strategies, and potential dependence on crowdfunding as a primary revenue source instead of exploring other sustainable funding models.

Related terms

Crowdfunding: A method of raising money for a project or venture by collecting small amounts of money from a large number of people, usually via the internet.

Pledge: A commitment made by backers on Kickstarter to support a project financially in exchange for rewards or incentives offered by the creator.

All-or-Nothing Funding: A funding model used by Kickstarter where projects must reach their funding goal within a set timeframe; if they don't, no money is collected from backers.