The Truth About Crowdfunding: Chances of Success

The Truth About Crowdfunding

The idea of crowdfunding is something that appeals to many writers and creative types. You have an idea, you tell the world your idea, and they give you the money needed to make it a reality. It’s perfect, or at least it’s perfect on the surface.

The problem with crowdfunding is that those on the outside looking in only know about the campaigns that were successful or the campaigns that went viral. As a result, their perception of crowdfunding is that it’s easy to get your project noticed and funded, and that it’s easy to take that funding and turn it into a successful project.

But that’s simply not the case. We have yet to create a crowdfunding campaign of our own, but we’ve written for many successful ones and a few unsuccessful ones, and we’ve learned a few key things in that time.

How Many Reach Their Goals?

Around a third of all Kickstarter campaigns are marked as successful, and this rate can also be seen on other platforms. But this doesn’t paint the whole picture. That includes campaigns that have a relaxed budget (in which case even a dollar will ensure success) as well as those with very small budgets. If you focus purely on the ones with a high budget, the ratio of success is actually very low.

How Many Become a Successful Product?

For every successful crowdfunded product, there are a dozen that met their goals but never saw the light of day. A successful campaign is just the first step. After that the product needs to be created, wages need to be paid, promises need to be kept, and budgets need to be controlled.

The issue with crowdfunding is that it puts money in the hands of creators, but they don’t necessarily know what to do with it, nor do they have any experience manufacturing, distributing, marketing, or doing any of the other things needed. They have a figure in their head that they assume will be enough, but when the campaign is over and the bills come in, they realise that simply isn’t the case.

We recently worked with a client who wanted to crowd fund the creation of an RPG and thought it could be done on a budget of $300,000. That’s a lot of money, and they assumed that it would be more than enough. But the project was doomed from the outset, because it needed at least 5 designers and coders, it needed half a dozen testers, it needed a premises for these to work from, and then they needed to factor in the manufacturing.

If you’re paying a skilled designer $50,000 a year to work on a game that will take two years, that’s $100,000 you need to budget for. If you have several of them, that amount climbs to over a quarter of a million before you even factor in the cost of equipment. It’s this naivety that causes many projects to fail after they have been funded.

How to be Successful Crowdfunding

We’ve written for everyone from regional car accident lawyers in Jonesboro, GA right on through to the biggest multinational brands in the world. One thing remains constant in all of those projects and is also true of a crowdfunding campaign: it needs to be well written, eye-catching, and interesting enough to hold a reader’s attention.

A successful crowdfunding campaign also needs to have a good campaign video and a good idea. That’s where it all starts. This is not one of those things that is built entirely on advertising—if you have a good idea and a genuinely good campaign, then it will get noticed and it will be picked up. It’s very difficult to succeed with a poor campaign and a lot of good advertising, but if those factors are flipped then success is easy to come by.

The problem is, there are a lot of campaign creators who will insist that they have done everything right and have a great campaign, but only because they’re either not looking at their idea objectively (or are claiming that “everyone loves it” because a few friends said it was great) or they don’t know what good copywriting is and therefore don’t have it.

Of course, great ideas and campaigns can still fail, but they are often poorly timed, too short, or just have some bad luck.

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