Kickstarter

Definition

Kickstarter is a crowdfunding platform that enables creators to present their projects to the public and raise funds through small contributions from a large number of people. This innovative funding model has transformed how artists, entrepreneurs, and creators secure financial support, allowing them to connect directly with their audience while also offering backers unique rewards for their contributions.

5 Must Know Facts For Your Next Test

1. Kickstarter was founded in 2009 and has since become one of the largest crowdfunding platforms globally, helping to fund creative projects in various categories like art, music, technology, and film.
2. Projects on Kickstarter must reach their funding goal within a set time limit; if they do not, no funds are collected from backers, which encourages creators to promote their campaigns effectively.
3. The platform operates on a reward-based system where backers can choose different contribution levels, each offering various rewards depending on the amount pledged.
4. Kickstarter has been instrumental in launching successful projects such as the Pebble Smartwatch and the Oculus Rift, showcasing its potential for innovative product development.
5. The platform emphasizes transparency and community engagement, allowing creators to share updates and communicate with backers throughout the funding process.

Review Questions

• How does Kickstarter's model impact the way creators approach project funding compared to traditional financing methods?
  • Kickstarter's crowdfunding model allows creators to bypass traditional financing methods like bank loans or venture capital by directly engaging with potential backers. This approach encourages a community-oriented mindset, where creators can validate their ideas through public interest before investing significant resources. Additionally, it fosters a sense of ownership among backers who feel personally connected to the success of the project.
• Discuss the advantages and challenges that come with using Kickstarter for funding creative projects.
  • Using Kickstarter offers several advantages for creators, including access to a global audience, validation of ideas through public interest, and the ability to generate buzz prior to launching a product. However, challenges include the need for effective marketing strategies to reach funding goals and the pressure to deliver promised rewards on time. Creators must also be prepared for the possibility of failure if their project does not attract enough backers.
• Evaluate how the success stories on Kickstarter have influenced entrepreneurial ventures in the creative industries and what implications this has for future projects.
  • Successful projects on Kickstarter have demonstrated that there is significant demand for innovative ideas and creative solutions within the entrepreneurial landscape. These success stories inspire new creators to pursue crowdfunding as a viable option for launching their ventures while also setting higher expectations for quality and originality. As more creators turn to platforms like Kickstarter, it could lead to increased competition and evolving standards in how projects are developed, marketed, and funded in the creative industries.

Related terms

Crowdfunding: The practice of funding a project or venture by raising small amounts of money from a large number of people, typically via the Internet.

Backer: An individual who financially supports a project on Kickstarter, often in exchange for rewards or early access to products.

Reward-based funding: A type of crowdfunding where backers receive non-financial rewards in exchange for their contributions, rather than equity or repayment.