There are a variety of crowdfunding platforms inhabiting the internet these days. Wikipedia currently lists over 40 sites, actually. Prior to looking up this fact, I would have said that there were maybe a dozen and I would have based that on actually visiting only about half a dozen Like any ecological niche though, it will be filled to bursting. Especially when there is this much money involved.

The reason most of you have never heard of so many of these sites is because they are very niche. The first crowd funding website, ArtistShare, started in 2000 actually, back in the roaring bubble days. Most of the early crowdfunding site’s were very niche, going after limited passionate constituencies. This trend continues to this day. There are sites devoted to music, art, books, community projects, charity, politics, and even breast implants. That’s right, breast implants.

As interesting as some of those discussions might be, today I want to talk about the big two: Indiegogo and Kickstarter.

Indiegogo was started in 2008, as a funding site for independent films. It expanded a year later to include all industries. Kickstarter was started a year later, and was a broad-based from the start, allowing you to fund a variety of categories from the start. There are a variety of difference between these two giants though, including: categories funding methods, their percentage, and internal search tools. Most articles comparing the two talk about how Indiegogo lets you keep the money if you fail to fund, but in my opinion that isn’t even the most important difference between the two. Let’s take a look at the biggest differences:

Categories:

Indiegogo lets you create campaigns for almost anything, from products to charities.

Kickstarter allows funding only for projects with finite goals (an end product basically).

Funding:

Indiegogo gets 4% if your project meets its goals, but will still disperse gathered funds to you if you fail to; in the later case it takes a 9% cut.

Kickstarter takes 5% and if you don’t cross the finish line, no one pays.

Functionality:

Indiegogo offers a wide array of search functionality.

Kickstarter has very limited functionality.

On paper it sounds like Indiegogo’s head start, and its significantly more flexible feature set should be allowing it to run rings around their competitions, but based on results, it seems like just the opposite is the case. Though it could be any number of things, I have a few theories on the subject.

I think Indiegogo’s flexible funding harms projects more than it helps them. Though I usually hear about it in a positive light, I would not donate any significant money to an ambitious campaign that had flexible funding. Pledging $30-50 to a worthy and credible project is one thing, but doing the same thing for a project that only get’s 20% of his funds, why bother? I assume, and do my due diligence based on the fact that these people have carefully figured out how much they need to get the job done. Giving someone less money than they need is just asking for frustration from all parties involved.

I also think that the average quality of Indiegogo’s projects is significantly lower than that of their main competitor. Whether this is because their bar to entry is lower, or because they have an enormous amount of ’cause’ campaigns (political and charity campaigns), I couldn’t say, but it is a real turn off when I look on their site. It just seems like the average level of care and effort that went into creating the project is low. I have a hard enough time sorting through one crowdfunding site for things that I like – two is asking too much.

That brings me to my final point – I love the search functionality on Indiegogo. I think that it is an absolute necessity, given my previous statements, but it is still well done. Kickstarter makes it’s curation perspective a virtue in most cases, but in this I feel they are making it intentionally harder to sort through their site to cause more foot traffic and window shopping.

At the end of the day, I still feel that both sites could do with a bit more crowd control. Telling people that you like their project, but that they should go back and work on it a bit more isn’t a bad thing. The more successful crowdfunders make their mouse traps, the faster the world will beat a path to their door. They had better start preparing for it.

This entry was posted by David Winchester.