Do You Still Get Paid If Your Kickstarter Doesn’t Reach Its Goal?

Kickstarter: What Happens When You Don't Reach Your Goal?

Key Concepts:

• All-or-Nothing Crowdfunding: The Kickstarter model where funds are only collected if the funding goal is met.
• Keep-What-You-Raise: An alternative crowdfunding model (like Indiegogo) where creators receive funds regardless of reaching the goal.
• Kickstarter Algorithm: The system that determines campaign visibility and ranking on the platform.
• Pre-Launch Phase: The crucial period before a campaign goes live, focused on audience building and preparation.
• Kickstarter Postmortem: A detailed analysis of a campaign's performance after it concludes, identifying successes and failures.
• Iteration: The process of repeated refinement and improvement based on feedback and data.

Understanding the Kickstarter Model

Kickstarter operates on an “all-or-nothing” crowdfunding model. This means that if a project doesn’t reach its stated funding goal, no backers are charged, and the creator receives no funds. This is distinctly different from platforms like Indiegogo, which utilize a “keep-what-you-raise” approach. Salvador Brigman, founder of Crowd Trucks and host of the “Crowdfunding Demystified” podcast, emphasizes this system isn’t about control, but about building trust. He argues that this model prevents the internet from being flooded with unfinished or undeliverable products, ensuring creators only proceed when they have sufficient resources.

As Brigman states, “Kickstarter’s model isn’t about control, it’s more about trust…if creators could keep only part of the funding, the internet would be full of sort of halfbroken products and promises.”

He uses the analogy of a rocket launch: “You can kind of think of this like a rocket launch, right? You're either going to achieve liftoff or you're not. You can't really get to outer orbit if you only have half of the fuel that you need.” This illustrates the necessity of full funding to successfully deliver on promised rewards. The all-or-nothing rule creates urgency, motivating backers to act and driving clarity in campaign strategy.

The Psychology of Momentum & Kickstarter's Algorithm

Kickstarter’s structure isn’t merely a rule; it leverages human psychology. Backers are motivated by the desire to be the one to push a campaign over the funding threshold, creating a shared sense of momentum. This momentum is crucial for campaigns to exceed their goals, potentially reaching 200% or even 500% of the initial target.

The platform’s algorithm also plays a role. Successful campaigns gain visibility, further amplifying their reach. Brigman highlights that Kickstarter acts as a “multiplier” for pre-existing effort, meaning a well-prepared campaign with a strong audience is more likely to succeed.

What Happens When a Campaign Fails?

Despite best efforts, campaigns sometimes fall short. Brigman stresses that failing to reach a funding goal isn’t necessarily a failure, but rather feedback. It indicates that the campaign isn’t quite ready or requires adjustments. Crucially, because backers aren’t charged, the creator doesn’t lose credibility.

He advises creators to conduct a “Kickstarter postmortem” – a thorough analysis of the campaign’s performance – to identify areas for improvement. He cites numerous examples of creators who failed with their first campaign but achieved significant success (e.g., raising $150,000) with minor tweaks on their second attempt. This emphasizes the iterative nature of crowdfunding: “It’s not about failure. It’s about iteration. And crowdfunding is really that process of learning.”

Practical Considerations & Timeline

• Payment Timeline: If a campaign is successfully funded, funds are transferred to the creator’s bank account approximately 14 days after the campaign ends, allowing Kickstarter time to process payments and account for fees (5% platform fee).
• Goal Modification: Once a campaign is live, the funding goal cannot be changed. Creators can edit text and add reward tiers, but the original goal remains fixed.
• Relaunching: Creators can relaunch campaigns after making necessary adjustments.

Common Reasons for Campaign Failure & Best Practices

Brigman identifies several common pitfalls that lead to campaign failure:

• Launching Too Soon: Insufficient pre-launch preparation (less than 30 days) to build an audience and generate excitement.
• Unclear Messaging: A lack of clarity regarding the project’s value proposition.
• Low-Quality Visuals: Poorly presented images or videos.
• Lack of Community: Absence of an engaged audience prior to launch.
• Unattractive Rewards: Rewards that don’t incentivize backers.

He emphasizes the importance of building a “movement” around the project, creating a sense of anticipation and excitement before the campaign goes live. He offers a free course at crowdcrux.com/kickstarter to help creators engineer success.

Resources & Support

Brigman promotes his book, The Kickstarter Launch Formula, as a “paint-by-numbers” guide to successful crowdfunding. It’s available on Amazon, as an ebook, and on Audible (crowdcrux.com/kickstarterformula and crowdcrux.com/kickstarteraudio). He also offers one-on-one coaching services (crowdcrux.com/coaching) for personalized guidance. He encourages potential clients to email him directly through his website, crowdcrux.com.

Conclusion

Kickstarter’s all-or-nothing model, while seemingly strict, is designed to foster trust and ensure creators have the resources to deliver on their promises. Failure isn’t final; it’s a valuable learning opportunity. Success hinges on thorough pre-launch preparation, clear communication, compelling rewards, and a willingness to iterate based on feedback. By understanding the platform’s mechanics and leveraging the psychology of momentum, creators can significantly increase their chances of achieving their crowdfunding goals. Brigman’s final message is one of encouragement: “Throw off the chains, man? Throw off the shackles. And if you have that little voice in your head that just saying like, 'Oh, I don't know if this is going to work or I can't do this.' Just really bulldoze over that and be willing to move forward with confidence.”