Crowdfunding - Pros & Cons
Kickstarter is the largest crowdfunding platform for creative projects while Indiegogo's platform can be used for campaigns of all types. Crowdfunder is best suitable for start-ups and growing businesses that seek to raise capital while GoFundMe charges zero percent platform fee.
- Kickstarter has a huge funder base compared to other crowdfunding platforms. According to report, Kickstarter has over 15 million project backers worldwide. The platform experiences about 22.05 million unique visitors monthly.
- Kickstarter has a simplified payment process for project creators. It takes 14 days to process and transfer funds to creators.
- The funding platform is only limited to creative projects which includes films, gadgets, arts, technology, music etc.
- Campaign for funding on the platform must first undergo an approval process before it goes live.
- Kickstarter only has the fixed funding goal option known as "All-or-nothing funding". Project creators do not receive the money raised if they don't achieve funding goals within the set time.
- Indiegogo crowdfunding platform can be used to raise fund for just anything including charity, small businesses, disaster relief, animal rights, music, etc.
- Indiegogo gives creators the option to choose between the fixed funding or the flexible funding goal. The flexible funding option allows creators to receive funds raised despite not meeting their goals.
- The Indiegogo InDemand enables creators to keep raising funds even after their original funding goals has been achieved to help support the production and delivery of their products.
- A 9% fee is charged by Indiegog for funding campaigns that did not their goals.
- Communication is limited between campaigners and backers.
- The platform allows quick withdrawal of funds to organizers and deposits are made within 2–5 days.
- GoFundMe charges 0% platform fee for personal and charity campaigns.
- No set deadline or time limit for campaigns and receiving donations.
- GoFundMe's customer service cannot be contacted through the telephone or in-person. They can only be reached via an online contact form to initiate a query or raise an issue.
- They have a low success rate for a fully-funded campaign. One in ten funding campaigns is successful.
- Creators can to set flexible funding goals on the crowdfunding platform.
- Patreon has good interface that helps creators track and interact with their audience.
- Patreon does not have built-in promotional tools on its platform.
- Patreon is best for individuals that already have huge social media following due to the difficulty in getting people to make a financial commitment on the platform.
- The platform is best for start-up companies and mature businesses that wish to raise seed funding and Series A.
- They do not charge processing fees for their payments.