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Hip New Funding Site: Kickstarter.com

This article was written by in Career and Work. 9 comments.

This certainly isn’t the first or only Web site where one can describe a project and ask for donations, but if word of mouth is anything to go by, the new Kickstarter.com is the hip place to get funding these days.

I first heard about it on Twitter when one of my heroes Jesse Thorn linked to his project for people who want to learn to dress better, one might say “more sartorially”, if one were in the habit of speaking like a character in a PBS murder mystery series. Jesse described his project, tweeted about it once or twice, and the project is now over-funded and, one assumes, in production.

About 60% of the projects have been successfully funded, and they range from “help me produce my next album” to “experimental three-wheeled human-powered vehicle”. The trend seems to be that donors get a little something back for their effort, whether it be an autographed CD or credit in a Web series, etc.

I think I’m personally a little too old-fashioned and/or proud to ask for free money from strangers. If I have an idea for a new project (and I have them about once a month, most of them never launch), and I think it’s worth pursuing, and all I’m missing is the financing… isn’t that why people get things like loans and business partners?

Anyway, if you’ve used a service like this successfully, we’d love to hear about it in the comments.

Got a dream but no cash? The Internet can help, Matthew Goldstein, Reuters, Sep 4, 2009

Published or updated September 7, 2009. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Smithee formerly lived primarily on credit cards and the good will of his friends. He is a newbie to personal finance but quickly learning from his past mistakes. You can follow him on Twitter, where his user name is @SmitheeConsumer. View all articles by .

{ 4 comments… read them below or add one }

avatar Corey

Business partners are not for funding. Sure, loans are one option for funding a business venture, but depending on the size of the company and its credit history (zero at this point), they don’t come easy. Getting funding from private investors in exchange for stock in the company has become the default for companies in the tech industry, and it’s growing popularity in other sectors. It’s long been the investment model for companies starting from nothing that need a large amount of funding (greater than 5M).

People have a natural desire to help other people innately, and that’s exactly what they get a chance to do at Kickstarter. They can put their money towards something they support (see the Kickstarter project about saving old records) and they can get a little something back as a thank-you. Not everybody is going to be interested in doling out cash to someone over the internet, but we’re getting more and more web-savvy and there are plenty of people that ARE willing to do just that for the whole project to be a success.

If you’ve not already, I suggest checking out Kiva.org. They’re a micro-loan website dedicated to lending to people in need. Not unlike Kickstarter, they’re crowd-funded, but the loans they give out do get repaid (98% repayment rate, in fact) and you’re helping someone in need.

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avatar david hausdorff

Awesome list. I’m in the midst of site review. You literally posted this the day I started on it

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avatar Matt

I think KickStarter is a great idea! Corey is right, people do have a desire to help people. And I certainly would rather be “funded” than to take a loan from someone who I also don’t know. I would also feel more accountable to finish the product.

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avatar Gordon

I just wanted to comment that money from Kickstarter is not “free money.”

I am using Kickstarter to self-publish my comic strip’s first book collection (I just passed my goal of $7500 today), but the pledge rewards include free digital copies of some of my comics, a free signed and doodled-in copy of the book (of course), sketches, exclusive T-shirt, or even cameo appearances in the comic book itself.

I’m definitely working for that money — even if the backers are paying me about the same as (or more than) they might for these same things. While, sure, I’ll get to keep the rest of the profit from the book sales, after all my costs have been covered, I don’t know if calling that “free” money is really accurate.

You yourself point out that projects give “a little something back for their effort.” You have to have something of value to offer, or nobody is going to back your project. It’s like getting an advance from my readers, rather than from a publishing company.

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