Kickstarter is a crowdfunding platform that has changed how small businesses operate. It is a platform where anyone can donate money to a new company, product, or idea. Here is how it is changing the business landscape and what you need to know:
Lower Risk
Traditional business ideas are high risk. You need to put out the money, time, effort, and labor to achieve them. However, with Kickstarter, this risk is reduced. You don’t need to spend your own money. Instead, you pre-sell the idea and let your market pay you first. Then, you are operating with nothing out of pocket. This is exactly what the creators of Cards Against Humanity did when they began their kickstarter in 2010; and now, their game is sold not just in stores nationally, but internationally.
Individual Project Funding
Sometimes, you want to explore a new business idea or opportunity. However, it might not be part of your current offering. In this case, Kickstarter is allowing businesses to test out just one single idea and get funding for it that they otherwise might have put aside and forgotten about.
Replacing Investors
In the traditional world of businesses, getting investments is difficult. You need to pitch them, go through various meetings, and agree to harsh term sheets. Crowdfunding has eliminated the need for the traditional investor so you can cut out the middleman and go right to your customers. Nomatic did just that when they began a kickstarter for their wallets in 2014; orders for their project poured in, and since then, they have been able to expand their line of products to include all sorts of travel-friendly bags and gear.
Scale
Because Kickstarter is a global platform, you can reach anyone anywhere with your business. They can find you online and that means you can scale without having to invest in additional offices or marketing personnel.
Rapid Product Development
Keeping your cash flow healthy is one of the most important parts of business. That is why it can take a while for products to get off the ground. You have to space out how much you put into it at one time. This means that your competitors have more time to innovate and push you out of the market. But not if you use Kickstarter. You can rapidly build products because they are already funded by the masses, just like M3D did to create affordable 3-D printers for the public.
Validation
There is virtually no risk to validating your product with Kickstarter. If it gets enough funding, then you get to keep it. If not, then you can scrap the idea. This means the validation process just got a big makeover.
If you are a small business owner or thinking of launching a start-up, then you need to leverage the power of Kickstarter. It allows you to cut costs, reduce risks, and get your product out to the mass market. So review the advice above and strategize how you can use crowdfunding to your advantage today.