Crowd funding options?

long_b

A family member is looking at doing a crowd funding campaign to expand her business.
There will be rewards etc per pledge level.

Has anyone done a comparison for the various sites recently? The provider she's looking at now is charing 5% commission plus 3% bank fees.

This seems pretty high to me - would it be standard enough?

Thanks in advance!

mahamageehad

There was a thread on this recently which might be a good starting point for you!
http://www.boards.ie/vbulletin/showthread.php?p=103285883

Graham

long_b wrote: »

A family member is looking at doing a crowd funding campaign to expand her business.
There will be rewards etc per pledge level.

Has anyone done a comparison for the various sites recently? The provider she's looking at now is charing 5% commission plus 3% bank fees.

This seems pretty high to me - would it be standard enough?

Thanks in advance!

What type of crowd funding is being considered?

Generally it's one of; pre-selling, crowd-lending or crowd-investing.

long_b

Graham wrote: »

What type of crowd funding is being considered?

Generally it's one of; pre-selling, crowd-lending or crowd-investing.

It's pre selling thanks.

Read the other thread - some good tips but I was hoping for more hard figures I guess?

Graham

long_b wrote: »

It's pre selling thanks.

Read the other thread - some good tips but I was hoping for more hard figures I guess?

Cheapest way to do it is on your own website using your own payment processor.

Naturally that means you loose a large chunk of the audience that the likes of Kickstarter/Indigogo have. That audience is arguably one of the things you're paying for, although I'm dubious as to it's value.

The self-run crowdfunding campaign could also struggle to find merchant services to accept payments. Pre-charging for products/services that may not be delivered for months leaves them susceptible to chargebacks for non-delivery etc.

long_b

Graham wrote: »

Cheapest way to do it is on your own website using your own payment processor.

Naturally that means you loose a large chunk of the audience that the likes of Kickstarter/Indigogo have. That audience is arguably one of the things you're paying for, although I'm dubious as to it's value.

The self-run crowdfunding campaign could also struggle to find merchant services to accept payments. Pre-charging for products/services that may not be delivered for months leaves them susceptible to chargebacks for non-delivery etc.

Thanks for this.
Pretty much sold on using a third party for this, just wondering if the 5% + 3% is competitive?

Graham

long_b wrote: »

Thanks for this.
Pretty much sold on using a third party for this, just wondering if the 5% + 3% is competitive?

'Competitive' is rather relative. For this type of fund-raising there's little in the way of competition.

I'm assuming you've already checked the charges from the 2 main providers (Kickstarter/Indiegogo).

If you're confident you can raise more (enough) with a DIY approach for less money then there's your answer.

Does the business already have a large number of customers or a significant social-media presence? Without either/both, it's likely to be an academic question anyway as crowd-funding is unlikely to work.

mahamageehad

Yeah, people underestimate how complex crowd funding can be.
Both IGG and KS take 5% commission plus 3% payment fees (and 20c per pledge on KS or 30c per pledge IGG). Then you need to consider flexible vs fixed funding. Without a known entity (either customers, mailing list or social presence) plus a good advertising budget, it'll be difficult for a creator to get noticed. On the other hand, if you do have a great premise, you need to consider what you'll do if you massively overfund. Success also depends on the industry - Music, Film, Food etc.