Should I launch my crowdfunding campaign on Kickstarter or Indiegogo?
Are you ready for everyone’s least favorite answer?
But really, it does. Each platform has their strengths and weaknesses and there are multiple factors that will play into which platform you should choose to launch on. If you look back on my past blog articles you can even watch me struggle with this question as I’ve learned more about what types of projects are best for each platform. By the end of this article though, you’ll have a detailed understanding of each platform and know which one you should launch on.
If I were to walk up to a random person on the street and ask them to name a crowdfunding platform, I’d put all my money on Kickstarter. I say this even though I have great love and respect for Indiegogo’s platform. The reason why is because Kickstarter has done a better job of making their brand synonymous with crowdfunding.
Even though they started after Indiegogo, they’ve surpassed them in terms of funds raised and daily traffic. As of October 23rd, 2019, they’ve raised $4,606,789,065 from 171,851 projects and 17,014,829 backers – of those 17 million backers, 5,595,691 back multiple projects.
According to SimilarWeb, a traffic estimator, Kickstarter sees an average of 22.05M unique visitors a month.
You can launch your campaign within 15 primary categories on Kickstarter and 155 sub-categories. Kickstarter’s mission is “to help bring creative projects to life.” They’ve backed up that mission by becoming a Benefit Corporation in 2015 – and are still one of the few companies to have done so.
Out of all the categories they have though, it’s useful to note that the top 3 categories in terms of funding are the following:
These category stats usually surprise quite a lot of people. They don’t realize that the largest category is Games. It’s a really impressive ecosystem that they’ve built.
I’ll tell you right now that if you have a game, just stop here and launch on Kickstarter. The community for games on Kickstarter is far bigger than Indiegogo.
If you don’t have a game, then read on!
Indiegogo broke onto the crowdfunding scene before Kickstarter did. It was focused exclusively on independent films initially which is where it got its name. It didn’t take long for Indiegogo to start to add more categories. This willingness to try new things is a trait of Indiegogo’s platform which is one of the reasons why they are seen as the more “open” platform. They also have more lax rules around the types of projects that can launch and are more willing to work directly with campaign creators than Kickstarter.
Funny enough, the one thing they are not open about are their stats. Kickstarter has a page dedicated to live updating stats, but Indiegogo’s are harder to gather. We’re still able to gather some metrics through articles written about them and traffic estimator websites like SimilarWeb.
The most recent public data I could find while researching was from an article on 4.11.18 by Fast Company. In it, Indiegogo stated that they’ve raised close to $1.5 billion on their platform. Just using average amount raised since its founding in 2007 would most likely put their total raised close to $2 billion as of 2019.
According to SimilarWeb, a traffic estimator, Indiegogo sees an average of 12.16M unique visitors a month.
Using these estimates, the main takeaway is that Indiegogo is about half the size of Kickstarter in terms of traffic and dollars raised. But that does not mean that Indiegogo is 50% as effective as Kickstarter. There is much more that should be considered when assessing whether to use Indiegogo vs. Kickstarter which I’ll discuss in a moment.
In terms of categories, Indiegogo takes a different approach and has three primary categories: (1) Tech & Innovation, (2) Creative Works, and (3) Community Projects. Those are further broken down into 28 subcategories.
Where Indiegogo truly shines though is in Tech & Innovation. Over the past few years, they changed their primary positioning to target tech entrepreneurs. They’ve done a great job of niching themselves with this audience and is one of the main ways they are differentiating themselves from Kickstarter.
Now that you have a high level overview of the two platforms, let’s dive into how they differ in terms of how raising funds works.
When it comes to funding there are two models: fixed or flexible.
Fixed funding means if you do not hit your campaign goal within the campaign duration, you do not keep any money and the backers are not charged. Also, the platforms will not take any fee.
Flexible funding means if you do not hit your campaign goal within the campaign duration, you do keep the money and the backers are charged. The platform also takes its fee.
Kickstarter only offers the Fixed Funding model which is why it’s known as the “all-or-nothing platform”.
Indiegogo offers both Fixed & Flexible Funding models and you see the majority of the campaigns choosing the Flexible model. There’s no difference in fee structures for Fixed & Flexible which is why most campaigns opt for Flexible.
Both platforms have strict policies for which countries are able to launch. This is an ever updating list of countries, so I recommend going to each platform’s support centers to see the most updated list before you launch. As of October 24, 2019, this is the current breakdown.
Kickstarter supports 22 countries.
Project creation is currently available to individuals in the US, UK, Canada, Australia, New Zealand, the Netherlands, Denmark, Ireland, Norway, Sweden, Germany, France, Spain, Italy, Austria, Belgium, Switzerland, Luxembourg, Hong Kong, Singapore, Mexico, and Japan.
Indiegogo supports 21 countries.
Campaign creation is currently available to individuals in the US, UK, Canada, Australia, Hong Kong (China campaigns may be eligible), Austria, Belgium, Denmark, Germany, Finland, France, Republic of Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Singapore, Spain, Sweden, or Switzerland.
The countries available are directly related to the countries that their payment processor, Stripe, supports.
Important note: if you are outside of these countries, you may still be able to launch using Stripe’s Atlas program (https://stripe.com/atlas). Stripe Atlas allows entrepreneurs to setup a US based business and bank account which can be used for the crowdfunding campaign.
Indiegogo used to offer PayPal as an option for payment processing, but has recently dropped them and uses Stripe – just like Kickstarter. Stripe is an incredible payment processor which means you’ll need not worry about payments going through or being handled properly. The only drawback of using Stripe is that it is more restrictive than other payment processors which is why the countries able to launch on both platforms is fairly limited.
PAYMENT PROCESSING FEES
Both platforms have essentially the same payment processing fee structure since both use Stripe. They are slightly more detailed than the simple 2.9% + $0.30 per pledge (for Indiegogo) and 3% + $0.20 per pledge (for Kickstarter) that I listed in the table above.
For example, pledges under $10 have a discounted micropledge fee of 5% + $0.05 per pledge on Kickstarter. On Indiegogo, you may be charged slightly different transaction fees and transfer fees depending on which country you are coming from.
I suggest looking at each platform’s support page to see the most up to date fee structure as this will likely change in the future.
You’ve finished your campaign on Indiegogo & Kickstarter so you’re probably wondering… “where’s my money?”. Each platform takes some time to process all the transactions and then send the money (minus the fees) to your bank account.
For Kickstarter, it’s simple. There is a 14 day window for them to go through their processing and then transfer the funds.
For Indiegogo, it’s slightly more complicated. Your initial disbursement is sent within 15 business days after your campaign ends. If you raise more than 1000 in your currency, Indiegogo will automatically hold 5% of your funds in “reserve” for refunds and chargebacks. Reserved funds are held for 6 months after your campaign ends and then transferred to your bank account.
When someone contributes to a crowdfunding campaign, each platform will handle the payment differently.
For Kickstarter, backers are charged immediately when the campaign ends. That means that a backer who pledges on Kickstarter only has their credit card validated, but they are not charged immediately. When the campaign ends, Stripe attempts to charge all backers. The drawback of this system is that there will be credit cards that fail to charge for a variety of reasons: insufficient funds, fraud alerts from their bank, etc. Backers do have one week to correct their credit card information after the campaign ends, but you should expect many of them to never do that. You will not be charged fees on the backers that have failed payments.
On average, we see about 3% of all pledges on a Kickstarter campaign fail. The two factors that contribute the most to the percentage of pledges that fail are (1) your price point and (2) location of your backers. Higher price points, usually in the hundreds or thousands of dollars, are more likely to fail because banks may flag them as unusual activity. Location can affect it because international backers (in relation to where the campaign launched) are more likely to also be flagged by banks as unusual activity.
For Indiegogo, backers are charged immediately when they pledge on the campaign. This has major advantages for the campaigner since you have an accurate idea of how much you’ve actually raised since you don’t have to worry about failed payments. Backers are still able to initiate refunds during the course of the campaign, but the refund rates are extremely low in my experience. As stated above, Indiegogo does hold 5% of your funds in reserve for possible chargebacks or refund requests for 6 months after your campaign ends.
Marketing & Promotion Differences
Each platform has different features when it comes to how you can market your campaign on their platform. From tracking tools to promotional opportunities, let’s dive into the key differences.
Google Analytics is the standard when it comes to free analytics tools for websites. It’s extremely robust out of the box and you’ll want to have it setup for your campaign. Both platforms offer Google Analytics integration easily – all you have to do is put your tracking ID into the backend of your campaign. Check out this article to learn how to do this.
There’s an option in Google Analytics to turn on ecommerce tracking which allows you to understand purchase data from within your Google Analytics account. Both platforms also automatically add the tracking code necessary for you. All you have to do is turn ecommerce tracking on in your Google Analytics account and the platforms will automatically send the data correctly.
Where the platforms differ is in their accuracy around Google Analytics tracking. In my experience, Kickstarter has a better integration and the data tracked in Google Analytics almost identically matches the data tracked on your Kickstarter campaign. Indiegogo usually over reports the data slightly so it’s important to take this into account when you are looking at the data in Google Analytics if you launch on Indiegogo.
GOOGLE ADWORDS TRACKING
Google AdWords is Google’s name for their advertising platform. Within your Google AdWords account, you will have a special tracking code to track conversions from your ads.
Indiegogo allows you to add this code to the backend. Kickstarter does not. With that said, since Kickstarter has Google Analytics tracking, you can still track your Google Ads within Google Analytics, but it won’t show up in your Google AdWords tracking. It’s not the end of the world, but Indiegogo makes it easier to track ads since they allow you to put this code in the backend.
Facebook & Instagram are by far the largest external sources of traffic to crowdfunding campaigns. The Facebook Pixel is a piece of code that allows you to track the effectiveness of your ads – which is extremely important when advertising.
If implemented, you can track important metrics such as:
Furthermore, giving Facebook this data will automatically make your ads more effective. When the Facebook Pixel tracks a purchase, their algorithm automatically starts showing your ads to people like the person that purchased. Without the Facebook Pixel, this can’t happen.
Kickstarter does not allow the Facebook Pixel.
Indiegogo does allow the Facebook Pixel.
This is a major drawback of Kickstarter and one of the biggest pros of launching on Indiegogo. Since Kickstarter doesn’t offer this, creators are forced to use agencies that have built custom solutions to tracking Facebook ads. Unfortunately, many agencies in the space take advantage of creators and have predatory business models that strip most of the margin from campaigns. I’ve seen many campaigners succumb to these agencies when their campaign stalls because they aren’t empowered to run the ads themselves.
On the other hand, Indiegogo does allow you to add the Facebook Pixel which has led to many more creators taking control of their own ads. I believe having the Facebook Pixel empowers creators and leads to a healthier crowdfunding ecosystem. Does that mean Kickstarter will add it in the future? No one really knows as they don’t publicly state why they don’t have it, but I think the answer is: probably not. They’ve held off on adding it for 10 years. They don’t have the Facebook Pixel on their site for their own use. My guess is that they don’t feel Facebook aligns with their values as a company.
Time will tell, but as of now, Indiegogo is the only platform that allows you to track their own Facebook Ads using the Facebook Pixel.
Over the past couple years, both platforms have added the functionality for you to create your own tracking links from within their platform. This means that you can quickly create unique links that will be tracked from within the platform’s dashboards. This isn’t a huge feature, but sometimes it’s nice to have an easy way to create a tracking link you use for marketing efforts.
Like we talked about earlier, both platforms have tens of millions of unique visitors a month. The platforms know this and take advantage of those eyeballs by offering promotional opportunities to some campaigns. How you get the promotional opportunity and what is available is where the platforms differ.
On Indiegogo, it is much easier to tap into their promotional opportunities. Two of the most effective opportunities they offer are (1) newsletter placement and (2) homepage placement. If your campaign is doing very well, they will likely reach out to you about these opportunities. Some of them may have added costs such as a higher commission from sales that come through those sources. They even offer contracts to some creators for hitting certain funding milestones. For example, you may hit $100K in funding, and they’ll put you in their newsletter.
These promotional efforts from Indiegogo can send a lot of sales – especially if you get a top spot. For example, the chart below is from the VAVA 4K Laser Projector campaign we launched on Indiegogo that is currently at $2,068,676 in funding. Each of the spikes in sales I point to are when Indiegogo sent newsletters. Some of those spikes were over $50K in funding in one day.
Kickstarter treats promotions much differently. They also have newsletter promotions, homepage placement, and also their coveted “project we love” status. But each of these promotions are much harder to get. Even as a Kickstarter Expert, we get no special treatment on our campaigns. Kickstarter is not open to talking about them and they make the decision behind closed doors whether or not they want to give you one of the promotions. Part of me respects their approach to this because if you do get one of their promotions, it can be very powerful. The other part of me just wishes they’d be more open to discussing it like Indiegogo.
In the end, both platforms offer promotions, but Indiegogo is by far easier to work with.
Upselling is a tactic where when someone goes to purchase an item, you immediately offer them another item to add to their order. This is a staple of ecommerce marketing strategy and Indiegogo started offering this in 2019. Kickstarter does not offer this.
Indiegogo calls this feature “add-on perks”. We were one of the first people to try this new feature out with our campaign AIR PIX (which has raised $1,390,398 to date). Using the Add-On perk to sell their Custom Charging Case, we were able to raise an additional $133,844. That’s nearly a 10% lift in sales just by adding one Add-On Perk to checkout.
This is an incredibly valuable feature and one that I consider a “no-brainer” for any campaign launching on Indiegogo.
A secret perk/reward is a product offering on the platform that only appears if someone clicks on a specific, unique link. Indiegogo pioneered this feature and Kickstarter has not followed in its footsteps.
This is a valuable feature as it allows you to be more creative with your marketing strategy. For example, you can offer a secret discount to people that sign up on your email list during the pre-campaign. Or you can remarket to people that got to checkout and didn’t buy via Facebook advertising that gives them free shipping. The possibilities are vast and it’s a feature we use on every Indiegogo campaign.
Limited perks/rewards are ones that have a limited amount of quantity or time that they are available. Both platforms offer some variation of this but Kickstarter’s is more robust.
On Kickstarter, you can limit a reward by both quantity and time. That means you could create a reward that only has 100 available and will end at midnight on a certain day. This gives you the opportunity to create promotional strategies using scarcity and urgency – both very powerful marketing tactics.
On Indiegogo, you can only limit a reward by quantity and they have not added time limits yet.
Here’s a handful of other notable differences between the platforms.
Each platform takes a very different approach to creator support. When I say creator support, I mean their willingness to help you with your crowdfunding campaign – everything from promotional opportunities to answering basic questions about how to crowdfund.
To put it bluntly, Kickstarter does a poor job of this. And in all my years of working in the crowdfunding industry, I’ve never seen them add more resources to their creator support department. It’s not impossible to talk to someone there, but like the promotions, they are very picky with who they work with.
Indiegogo offers a great deal of support and has a very large team dedicated to working directly with creators. It’s highly likely that you’ll be assigned a campaign strategist on your campaign who will work with you to make sure you have the best chance of success.
Kickstarter & Indiegogo approach the “review” process very differently and have different rules about the types of projects that are allowed on their platforms.
As stated before, Indiegogo is generally a more open platform and doesn’t require that you go through any review before you launch. That doesn’t mean they don’t have rules though and their team will still shut your campaign down (no matter how much you’ve raised already) if you don’t follow them.
Kickstarter has a manual review process that usually takes 3-5 days. This is why on Kickstarter, it’s very important to factor the time it takes to get through the review process into your timeline for launching. Best practice is to submit your campaign for review at least 7 business days prior to your launch date.
FUNCTIONAL PROTOTYPE NEEDED
A functional prototype is one that has all the features you claim your product will have in your marketing. Functional does not mean it has to look good though. Many creators who have more technologically advanced products may have multiple prototypes: one that is visual and one that is functional. We use the visual prototype to create all the marketing and the functional to prove it can do what we say it can do.
On Indiegogo, you do not have to have a functional prototype to launch. If you don’t have a functional prototype though, you must clearly state that your project is in “concept” phase.
On Kickstarter, you must have a functional prototype and clearly show the functional prototype working on your campaign page.
You’ll need to gather accurate shipping information from your backers to ship your product once you’ve finished manufacturing.
On Indiegogo, your backers will give this information when they checkout.
On Kickstarter, backers are not able to give this information when they checkout. For this reason, you are required to send surveys after your campaign is over to gather this information. Kickstarter has built in surveys you can use, but I recommend using a 3rd party tool like BackerKit which is more robust and allows you to also upsell your backers additional items.
Let’s say that you are crowdfunding a new pair of shoes. Unless you’ve invented one size fits all shoes, you’ll need to know which size your backer wants before you ship them out.
On Indiegogo, you are able to create product variants when you create your perks. Backers are able to choose their desired product variant when they go through the checkout process.
On Kickstarter, you are not able to create product variants when you create your rewards. Like shipping information, you must follow up with your backers post-campaign with a survey to gather this information.
After your campaign funding duration is over, you’ll want to continue pre-selling your product.
On Indiegogo, your campaign can automatically convert to an InDemand campaign where the campaign duration and funding goals don’t apply anymore – essentially turning your Indiegogo page into a pre-order page for your product.
On Kickstarter, there is no post-campaign funding feature. Instead, Kickstarter allows you to add a button to the top of your Kickstarter page which is called Spotlight. It’s recommended to launch an Indiegogo InDemand campaign immediately when your Kickstarter campaign ends and direct your Kickstarter Spotlight to your InDemand campaign. It’s important to note that InDemand increases their fee from 5% to 8% if your campaign originated on Kickstarter as a way to incentivize you to launch on Indiegogo.
Which one should you choose?
First, study the differences between the two platforms and see which ones are the most valuable to you. For example, if you plan to run your own Facebook ads and don’t want to rely on an outside agency, Indiegogo may be the better platform since they allow the Facebook Pixel. If you think your product better aligns with Kickstarter’s community and you want to tap into their larger organic backer base, then Kickstarter may be your best bet.
Here is a case study of 4 different brands who all had launched six-figure crowdfunding campaigns on Kickstarter. For each of their new campaigns, they decided that Indiegogo would be a better platform for them to launch on. The major similarity between the four projects were they were all tech products. As I stated before, Indiegogo has repositioned themselves as a platform for tech entrepreneurs and their positioning is paying off.
All four Indiegogo campaigns raised more than their previous Kickstarter campaigns by a significant amount.
WHY WAS INDIEGOGO MORE EFFECTIVE FOR THESE CAMPAIGNS?
First off, I know that it’s impossible to know if these campaigns would have performed better on Kickstarter than Indiegogo, but the fact that all four campaigns raised more than their previous Kickstarter campaigns was very interesting. Here are the top three reasons why I think that Indiegogo was more effective for these campaigns.
Reason #1: Facebook Pixel leads to higher return on ad spend
Kickstarter doesn’t let you put a Facebook pixel on your campaign which means you can’t track the return on your ads from within Facebook Ads Manager. As I’ve stated before, I think that Kickstarter is hurting creators by not adding this.
Not only did VAVA raise much more on Indiegogo than Kickstarter, they were able to do so with much higher returns than previous campaigns. Just take a look at our direct return on ad spend within Facebook manager.
Here are some numbers pulled out of that screenshot:
By having the Facebook Pixel you can let Facebook do what Facebook does best: optimize the advertisements using their algorithms. Since we know if someone purchases from an ad, we can tell Facebook to optimize the ads and show them to more people like the person that purchased.
Reason #2: Indiegogo promotions & tech-oriented community
The Indiegogo team provided a great deal of promotional support for each of the campaigns above.
Just look at the percent funded by Indiegogo from the four campaigns below:
The most effective promotional methods that Indiegogo offered these campaigns were Newsletter placement and Homepage Banner placement. Both of these drove considerable amounts of pledges because Indiegogo has fostered a community of tech-driven backers.
Reason #3: Exclusive Indiegogo features
Both Kickstarter and Indiegogo offer the same core features, but Indiegogo has been raising the bar by releasing some extremely effective ones.
Now this feature is not rolled out on many campaigns but we got to experience it for the first time with VAVA. Essentially, Indiegogo will Guarantee Delivery of the product to backers. If VAVA doesn’t ship, then Indiegogo will refund the order.
This helps solve one of the biggest fears of crowdfunding which is not receiving the product you back.
Secret perks aren’t a new feature for Indiegogo but they are still unique to the platform. It allows you to create a “secret” perk that is only visible if someone clicks on a unique link generated by Indiegogo.
We are able to use secret perks strategically to offer promotions like exclusive discounts to our pre-campaign community or free shipping offers through remarketing ads.
Add-ons / Upsells
This is a brand new feature that we got to beta test for the AIR PIX campaign. It allows you to create “add-on” products that will be shown at checkout when someone backs a specific perk. You can see from the image that 466 backers took us up on that specific add-on which only increased the average order value across the campaign.
Armed with this information, you are now able to make a much more informed decision when evaluating the platforms. If I had to choose one platform to launch the rest of our campaigns on, I would choose Indiegogo because I feel there’s more freedom and their added features greatly benefit the campaigns.
But the good news is, no matter which you choose, you’ll be okay. Both platforms are great in their own ways and at the end of the day, there are other aspects of your launch strategy which will have more effect on its outcome.