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Leisure Handbook - Kickstarter

People

From Leisure Handbook 2014 issue 1
Kickstarter


Crowd funding is booming – and Kickstarter was the first to recognise its potential

Rhianon Howells
Kickstarter founders (from left to right): Charles Adler, Perry Chen and Yancey Strickler

New York-based dot.com Kickstarter is the world’s largest crowd-funding platform for creative projects, with over US$2m pledged every week to projects ranging from films to restaurants and from museums and arts festivals to a pool in the Hudson River.

Rhianon Howells talks to the founders about how the company started, its successes and plans for the future

He may have painted the Sistine Chapel, but throughout his life as a jobbing artist Michelangelo was forced to rely on the patronage of wealthy benefactors such as the Medici family to fund his work. If he’d been alive today, it’s possible he would have turned to Kickstarter instead.

The Medicis may seem to have little to do with a New York-based company that uses the internet to connect creative projects with potential backers. But it can be argued that crowd-funding ventures – jargon for dot.coms that help people raise money from donors – are a direct ancestor of those great Renaissance patrons.

“We view [what we do as being] at the intersection of commerce and arts patronage,” says Kickstarter’s communications director Justin Kazmark. “There’s this long past; Kickstarter was not really a new idea. What’s made it successful has been a fair amount of good fortune, the generosity of the people that back the projects and the creativity of the people that launch them.”

Set up in 2009, Kickstarter is a website dedicated to raising money for creative projects by mobilising thousands of ordinary people. It’s a simple concept. Project creators use the site to pitch their ideas to the public over a fixed time period of one to 60 days. They set a funding goal, explaining what the money will be used for, and if people like the idea, they can pledge anything from a few dollars to many thousands. Kickstarter’s project creators also benefit from the opportunity to build a fan-base before the initiative is even off the ground. “Project creators come on initially to articulate an idea and get enough funding to bring that idea to life,” says Kazmark. “What they leave with is a community of support.”

This is not the first time in history that potential audiences have been tapped to fund creativity; Kazmark argues that Beethoven was a pioneer of this approach when he pre-sold concert tickets to pay for new compositions. Even in the 21st century, Kickstarter isn’t the only company to apply the principle using the internet – the music and film industries have been at it for some time – however Kickstarter is the largest creative funding platform in the world and at September 2013, more than US$792m has been pledged through the website. Around 49,000 projects have been funded via 11 million pledges from 1,384,620 people. Kickstarter raises funds across 13 categories – from dance and food to theatre and technology

CREATIVE PURPOSE
The idea for Kickstarter was born in 2002. At that time, New Yorker Perry Chen was working in New Orleans and looking forward to the city’s annual Jazz Fest – so much so he thought it would be great to throw a concert during the festival.

Chen, whose CV includes stints as an audio engineer, musician, writer, art gallery co-founder and day trader, was no stranger to either the arts or business, but unable to raise the funds to fly the artist he wanted from Europe, he was faced with fronting the money himself then trying to recoup it through ticket sales later on. In the end, he decided the whole venture was just too much of a risk to take on personally without backing.

“After the dust settled, he started thinking that there must be a way to get the audience involved with bringing [creative projects like this] to life,” says Kazmark, who has been with the company since its early days.

In 2005, Chen moved back to New York, and shared his idea with Yancey Strickler, a music journalist, and Charles Adler, a web designer. Together, they worked out how the concept would work online, and on 28 April 2009 they launched Kickstarter.

One of the things that can make Kickstarter a more attractive option than more traditional forms of funding is that it’s not about investment, because ownership of the project stays with the creators. Crucially, Kickstarter also has an all-or-nothing policy, meaning money only changes hands if the funding goal is met. “This makes sure that backers are supporting projects that are fully funded,” says Kazmark. “And creators are also protected, because they’re only on the hook to deliver if they have the cash to do so.”

The company takes a five per cent cut of every deal, but this is if and only if, a project is successfully funded.

To raise money on Kickstarter, projects must meet certain guidelines, some of which are dictated by the company’s partner, Amazon Payments (which charges 3-5 per cent for credit-card processing). This means tha the project must have a clearly defined beginning and end (you can’t fundraise for general expenses) and it must have a creative purpose. But within these limits, anything goes, and 60 per cent of proposals make it onto the site.

Around 45 per cent of all projects on Kickstarter currently meet or exceed their funding goal – once a goal is met, pledges can continue until the deadline. On average, successful projects achieve 125 per cent of their funding goal, and some blow the goal out of the water. One of Kickstarter’s biggest success stories is +Pool (see below) an ambitious plan to build a floating swimming pool in the Hudson River. The $25,000 goal was met in six days, later exceeding $40,000 – and attracting press coverage you can’t put a price on.

But projects don’t have to be as audacious as +Pool to do well on Kickstarter. Another community pool project that exceeded its funding goal recently was the modest Splash House (see case study). Other successful projects range from What Happens When, a temporary NYC restaurant installation combining food, music, art and design, to Colonie, a neighbourhood restaurant in Brooklyn; and from Swoon’s Musical Architecture for New Orleans, a plan for a high-concept house that functions like a musical instrument, to the Videogame History Museum in Silicon Valley.

WINNING FORMULA
So what makes a project succeed? “Number one, they’ve clearly identified what it is they’re trying to do,” says Kazmark. “Number two is getting the word out. Once a project is launched, it’s up to you to share it with your friends, family, fans… there’s a misconception that if you launch a Kickstarter project, you’ll get money from the internet. That’s not true – you have to do quite a bit of work.”

Other factors in a project’s success are typically a good video and appealing rewards. Although backers aren’t investors, this isn’t a money-for-nothing formula. “Yes, they’re pledging money, but they’re getting something in return,” says Kazmark. “There’s always a value exchange.” Typically, rewards are linked to the creative work, and increase in desirability with the size of the pledge.

Once a deadline has passed, it’s archived on the site, the money is collected and successful creators get on with bringing the project to life. The company is clear it’s not responsible for ensuring creators fulfil their promise, however, so much support comes from the creators’ family, friends and community that they have a strong incentive not to let anyone down – so to date this hasn’t been a problem.

Kazmark says Kickstarter is so intrinsically reliant on word of mouth that the company doesn’t do much marketing beyond the occasional event and some press interviews. It does, however, have strategic partnerships with over 70 creative organisations – ranging from YouTube to Robert Redford’s Sundance Institute – all of which have ‘curated pages’ on the site showcasing projects they support.

GLOBAL ROLLOUT
Since its modest start, the company has captured the imagination of the public, with US$2m now being pledged on the site each week and the start of international expansion underway with the launch of Kickstarter in London in 2013.

Successful projects underway in the UK include Tribesports, the world’s first community-powered sportswear range, which has been developed by a 200,000-strong sports collective. The group is aiming to offer savings of up to 40per cent on sportswear by selling direct to customers and is using its Kickstarter funds to set up. The project was 398 per cent funded at £120k when it closed.

Splash House

The creators:
Design Workshop is an innovative studio that provides pro bono work to nonprofit organisations while giving graduate architecture students valuable work experience.

The concept:
The Highbridge Pool and Recreation Center in New York, offers children a place to play and learn. However, every summer, local children were being denied this facility when the recreation centre was turned into a temporary locker room site for the neighbouring Highbridge Park Swimming Pool. The aim of this project was to build a new pavilion for the park swimming pool so the recreation centre could be kept open for the children all year round. They asked for $15,000 on Kickstarter to buy building materials.

The results:
The project raised $16,493 from Kickstarter, with 232 backers. Construction is now complete and the pavilion has been reopened. When the pool is at capacity, Splash House’s sliding doors can close off the locker room, creating additional changing rooms. Another feature is the water curtain, which acts as a shower for rinsing, and a water fun feature for children to play under. The structure is made from cedar, plywood and translucent corrugation that stretches from the ground across the roof, flooding the interior with light.

 



Splash House
+Pool

The creators:
+Pool (pronounced plus-pool) is the brainchild of three NYC-based designers: Dong-Ping Wong of Family design studio, Archie Lee Coates and Jeffrey Franklin of PlayLab.

The concept:
After a very hot summer in 2010, the trio dreamed up the idea of building a floating, cross-shaped pool in the Hudson River that would actually use filtered river water. Leading engineering firm Arup offered their services, and in June 2011 the founders launched the project on Kickstarter in hopes of raising $25,000 to test the filtration system.

The results:
The project reached its funding goal in six days, eventually going on to raise $41,647 in pledges from 1,203 backers. The money has already paid for the first round of filtration testing, with the remainder going towards round two. If things continue to progress, +Pool is set to make it into the water by late 2013.

Dong-Ping Wong:
“The pool has been so dependent on public interest that it made sense to start with a public campaign like Kickstarter… but it’s still a bit of a surprise to see that people are not only interested, but interested enough to put money towards a project still in the works.”

 



+Pool
Swoon’s Musical Architecture for New Orleans

The creators:
This project was launched by the New Orleans Airlift, a multi-disciplinary arts organisation founded in 2007 by artist and curator Delaney Martin and musician and DJ Jay Pennington. The Airlift aims to create and facilitate innovative artistic opportunities for New Orleans-based artists, locally and around the globe.

The concept:
The aim is to create a unique musical house in the salvaged remains of a Creole cottage. Globally renowned, Brooklyn-based artist Swoon has designed a permanent, interactive sculpture known as ‘the Dithyrambalina’, a house with instruments built into the walls and floorboards, enabling it to be ‘played’ by both visitors and musicians. However, before the house could be built, the instruments needed to be created and tested.

To this end, the group decided to launch a temporary installation in the city called The Music Box, which would hold prototypes of instruments for the final house. It was this project that they launched on Kickstarter with a goal of $12,000.

The results:
By deadline, the project had raised $23,977 through 357 backers. The Music Box opened in New Orleans in autumn 2011, and the aim is to now build the Dithyrambalina.

Delaney Martin says:
“Kickstarter was less constrained than a traditional grant that has activity periods, final reports and complicated finances… and no-one could have predicted that Kickstarter would also become an important PR tool."

 



Swoon’s Musical Architecture for New Orleans


From Leisure Management Issue 1 2012, p46

Originally published in Leisure Handbook magazine 2014 issue 1

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