A large-scale study has examined previous projects on the crowdfunding platform Kickstarter and shows what initiators need to pay attention to.
Crowdfunding is a practical way of pre-financing and customer loyalty, especially for products aimed at end customers: Customers pay in advance for a new product, e.g. a charcoal grill optimized for bicycle transport, and receive a discount. If a predetermined minimum sales volume is reached, the initiator receives the money. Otherwise, the buyers get their money back and the campaign fails.
A lot depends on reaching the funding goal. To learn more about what a successful crowdfunding campaign looks like, the fintech Finantio examined previous projects on the American portal Kickstarter. The Berlin-based company examined a total of 331,000 completed Kickstarter projects created between the portal's founding on April 28, 2009, and the end of January 2018.
Crowdfunding in Germany is a niche topic
First, it's interesting to look at the origin of the projects: 78.8 percent originate from the USA. Germany follows in fifth place with only 1.04 percent of all Kickstarter campaigns, behind Great Britain, Canada, and Australia. There are dedicated crowdfunding platforms for the German-speaking region, such as Startnext, but you can immediately see that compared to the USA, crowdfunding is still a niche topic in Germany.
40.4 percent of the projects examined reached their set funding goal. The remaining 59.6 percent missed the target, and the money was returned to the backers. Campaigns from Hong Kong were the most successful, with 45.3 percent. The US followed with 41.8 percent. German crowdfunders, in contrast, only reached their goal at 27.8 percent. Initiators from Italy and Austria performed even worse.
How much is too much?
Once the funding goal for a Kickstarter campaign has been set, it cannot be changed after launch. Therefore, deciding on the right target amount in advance is crucial for the success of a campaign: On the one hand, the money must be sufficient to complete the project. On the other hand, a high target reduces the chances of successful completion. The study data can provide a guideline. Study website The average funding goals of successful and unsuccessful Kickstarter campaigns can be viewed here. Here's an example for the Technology subcategory:
The right timing counts
The right launch time is also important for a successful campaign: The best months to launch a project are February, March, April, October, and November. It's better to wait for the months of July and December, presumably because of the holiday season. The best day of the week to start a project is Tuesday. Saturday, on the other hand, is the worst day to launch. Furthermore, past campaigns that went online between 2 p.m. and 4 p.m. were the most successful. Logically, it's best not to launch a campaign between 8 p.m. and 5 a.m.
Incidentally, the study found no correlation between project duration and the number of backers. Longer funding periods do not lead to more backers.
