GoFundMe vs. Kickstarter

Key Concepts

• Crowdfunding: Raising small amounts of money from a large number of people, typically via the internet.
• GoFundMe: A platform primarily used for charitable and personal cause-based crowdfunding.
• Kickstarter: A platform primarily used for rewards-based crowdfunding, focusing on creative and entrepreneurial projects.
• Charitable Crowdfunding: Raising funds for causes, emergencies, or non-profit organizations.
• Rewards-Based Crowdfunding: Raising funds in exchange for tangible or intangible rewards for backers.
• All-or-Nothing Funding: A model where creators only receive funds if they meet or exceed their funding goal.
• Fixed Funding Duration: A set period of time within which a campaign must reach its goal.
• Recurring Donations: The ability for donors to make ongoing contributions.
• Add-ons: Optional extras that backers can purchase in addition to their chosen reward tier.
• Stretch Goals: Additional funding targets that unlock further benefits or features for backers.
• Late Pledges: The ability for individuals to back a campaign after its official closing date.
• Campaign Page: The central hub for a crowdfunding campaign, including story, visuals, and funding details.
• Backers/Donors: Individuals who contribute funds to a crowdfunding campaign.
• Perks/Rewards: Items or experiences offered to backers in exchange for their contributions.

GoFundMe vs. Kickstarter: A Detailed Comparison

This video provides a comprehensive breakdown of GoFundMe and Kickstarter, two prominent crowdfunding platforms, highlighting their similarities, differences, pros, and cons. The presenter, Salvador Bregman, an experienced crowdfunding expert since 2012, aims to guide viewers in choosing the right platform for their needs.

GoFundMe: Charitable and Personal Causes

Main Topics and Key Points:

• Purpose: GoFundMe is predominantly used for charitable causes, personal expenses, emergencies, memorial funds, travel, education, and sometimes even for businesses. The common thread is a focus on charitable needs, causes, or non-profit organizations.
• Ease of Use: Launching a campaign on GoFundMe is described as "extremely easy," with readily available tutorial videos.
• No Set Duration: Campaigns can remain open indefinitely, allowing for continuous fundraising for a cause or need.
• Fund Flow: Funds can be directly deposited into the campaign creator's bank account.
• Fees:
  • No fees to get started.
  • A 2.9% fee on donations, plus a 30-cent fee per donation (as of the video's recording).
  • Donors are optionally asked to contribute a tip on top of their donation.
• Audience and Purpose: GoFundMe appeals to an audience that believes in stepping up to impact wrongs, right societal issues, make a donation for a good cause, or act from an ethical standpoint. Campaigns often center around disasters, emergencies, or specific needs. It's also suitable for "news event" or "news story" type situations where a community rallies around an individual.
• Emotional Connection: Successful GoFundMe campaigns connect with people on an emotional level, driven by a compelling story that inspires strangers to contribute. These stories can lead to viral campaigns picked up by news outlets and social media.

Examples and Real-World Applications:

• Emergencies (e.g., a business burning down).
• Memorial funds.
• Travel costs.
• Education-related bills.
• A homeless man turning in found money, leading to community donations.

Step-by-Step Processes/Methodologies:

• The video mentions the availability of step-by-step tutorials for launching a GoFundMe campaign.
• A free course is offered at crowdcrux.com/gofundme-course covering campaign setup, tools, and techniques for raising more funds, including strategies for virality.

Key Arguments or Perspectives:

• GoFundMe is best suited for raising money for a specific cause that has societal impact, often stemming from a negative or unfortunate event, and connects with people emotionally.

Notable Quotes or Significant Statements:

• "When it comes to GoFundMe, we tend to see lots of different types of projects being launched for charitable causes, personal expenses."
• "The one thing they have in common is that they tend to be for charitable needs or causes or for a nonprofit organization."
• "Whenever there is a story behind the GoFundMe campaign that's what I call the GoFundMe campaign has legs."

Kickstarter: Rewards-Based and Creative Projects

Main Topics and Key Points:

• Purpose: Kickstarter is categorized as "rewards-based crowdfunding" and is distinct from charitable crowdfunding. It's ideal for creative projects, including technology, design, films, theater, comic books, and new novels.
• Rewards-Based Model: Backers receive exclusive perks and rewards in exchange for their contributions, such as pre-ordering a product, contributing to a creative work (e.g., a line of dialogue), or naming a character.
• Fixed Funding Duration: Campaigns have a set duration (e.g., 30 or 60 days) within which they must reach their goal.
• All-or-Nothing Funding: Creators must hit or exceed their funding goal to keep the raised funds. This is a critical aspect of Kickstarter.
• Fees:
  • No fees to get started.
  • A 5% fee plus credit card processing fees are deducted from the total amount raised once the campaign ends successfully.
• Community Building: Kickstarter is effective for building a community around a new brand or creative endeavor, with backers often passionate about the creator's values and the medium being produced.
• Audience and Purpose: Kickstarter targets entrepreneurial and creative projects that produce an end result or product. Backers are interested in participating in the creative process, seeing behind-the-scenes content, and believing in the brand's values. They want to use the product or attend an event related to the project.
• Increasing Order Value: Strategies to increase overall funding include offering add-ons, stretch goals, and multiple reward tiers.
• Late Pledges: Campaigns can continue to receive funding after the official end date through "Kickstarter late pledges."

Examples and Real-World Applications:

• Invented products seeking funding for prototypes or mass production.
• New film projects needing funds for production or distribution.
• Design products and technology gadgets.
• New stove tops or home goods.
• Comic books and tabletop games.

Step-by-Step Processes/Methodologies:

• The video mentions a "paint by numbers formula" in "The Kickstarter Launch Formula" book for strategically launching campaigns.
• A free course is available at crowdcrux.com/kickstarter covering campaign setup, funding strategies, tools, and launch tactics.

Key Arguments or Perspectives:

• Kickstarter is ideal for entrepreneurial and creative projects where backers expect something in return for their contribution. The focus is on creating something tangible or experiential.
• The story behind a Kickstarter campaign is important, as are the brand values and the medium being produced.

Notable Quotes or Significant Statements:

• "When we think of Kickstarter, we tend to really kind of lump that into what's called rewards-based crowdfunding."
• "You have to either hit or exceed your goal first of all in order to keep the funds in which you have raised."
• "When people back your campaign on Kickstarter, they're not just donating money to your campaign, they're also getting access to what are called exclusive perks and rewards."

Comparing GoFundMe and Kickstarter: Key Differences

| Feature | GoFundMe | Kickstarter | | :---------------------- | :------------------------------------------- | :------------------------------------------------ | | Crowdfunding Model | Charitable-based | Rewards-based | | Primary Purpose | Causes, emergencies, personal needs, non-profits | Creative projects, products, businesses, inventions | | Funding Goal | Can have a set target, but can expand | Must hit or exceed to keep funds | | Funding Duration | No fixed duration | Fixed duration (e.g., 30 or 60 days) | | Donor/Backer Incentive | Feeling good about contributing to a cause | Receiving perks and rewards | | Fees | 2.9% + $0.30 per donation | 5% + credit card processing fees (on successful campaigns) | | Donor Options | Optional tips | Add-ons, stretch goals, multiple reward tiers | | Audience Focus | Empathy, altruism, societal impact | Innovation, creativity, entrepreneurship, community | | Outcome | Funds for a cause/need | Product, creative work, or business launch |

Audience and Purpose: A Deeper Dive

• GoFundMe Audience: People who believe in stepping up to impact a wrong, right a societal issue, donate to a good cause, or act ethically. They are moved by stories of disaster, emergency, or specific needs.
• Kickstarter Audience: Individuals interested in entrepreneurial and creative projects. They want to be part of the creation process, see behind-the-scenes, believe in brand values, and often desire to use the product or experience the outcome.

Which Platform is Best for You?

• Choose GoFundMe if:
  • You are raising money for a specific cause with societal impact.
  • Something negative or unfortunate has happened that necessitates fundraising.
  • Your campaign connects with people on an emotional level through a compelling story.
  • You need funds for personal expenses, emergencies, or charitable initiatives.
• Choose Kickstarter if:
  • You are starting a business, building a product, or launching a creative endeavor.
  • You have an invention idea, a new film, or a creative project that will produce an end result.
  • You can offer tangible or intangible rewards to your backers.
  • You want to build a community around your brand or project.

Crowdfunding Tips and Advice

1. The Story is King: The campaign page, including videos and images, is crucial. A compelling narrative differentiates successful campaigns from unsuccessful ones, even with similar functionality.
2. Mindful Donor/Backer Experience:
   • GoFundMe: Donors want to feel good about their contribution and understand its specific impact. Express gratitude and provide updates.
   • Kickstarter: Backers expect updates on the project's progress, production stages, and fulfillment of perks and rewards.
3. Build Trust: Be transparent and legitimate. People have been scammed before, so go out of your way to build trust with potential donors/backers.
4. Utilize Tools: Leverage available resources like videos, books, mentors, and platform-specific tools to enhance your crowdfunding efforts.
5. Be Humble: It's okay not to know everything. Seek knowledge and guidance.

Conclusion and Next Steps

The video emphasizes that choosing the right platform depends on the nature of the project and the intended audience. GoFundMe is for causes and needs, while Kickstarter is for creating and producing. The presenter offers free courses and individual coaching sessions for those seeking more in-depth guidance.

• Free GoFundMe Course: crowdcrux.com/gofundme-course
• Free Kickstarter Course: crowdcrux.com/kickstarter
• Individual Coaching: crowdcrux.com/coaching