Kickstarter
Kickstarter is an online crowdfunding platform founded on April 28, 2009, by Perry Chen, Yancey Strickler, and Charles Adler, and headquartered in Brooklyn, New York, that enables creators to raise funds for creative projects such as art, comics, design, film, games, music, and theater through an all-or-nothing pledge model where backers are charged only if the funding goal is met.[1][2]
The company operates as a public benefit corporation, having restructured in 2015 to balance profit motives with commitments to support artistic expression and balanced creative ecosystems.[1]
As of 2025, Kickstarter has amassed $9.23 billion in total pledges from 25 million backers across 287,875 successfully funded projects, though funding success does not guarantee project delivery, with creators retaining full control over execution.[3]
Prominent achievements include enabling breakthroughs like the 2012 Pebble smartwatch campaign, which raised over $10 million and paved the way for subsequent consumer tech ventures, alongside board games such as Frosthaven that exceeded $12 million in funding.[4][5]
Despite these successes, Kickstarter has encountered controversies from projects that raised significant sums but failed to deliver promised rewards, including instances of apparent fraud or gross mismanagement, exposing backers to substantial risks without equity stakes, refunds, or robust enforcement mechanisms.[6][7]
History
Founding and Early Development (2009–2012)
Kickstarter was conceived by Perry Chen in late 2001 while living in New Orleans, where he sought to fund a DJ event during Jazz Fest but lacked sufficient backing; he envisioned a platform allowing advance pledges that would only charge backers if the funding goal was met, enabling risk-free support for creative projects.[1] Chen relocated to New York City in 2005 to pursue the idea, partnering with Yancey Strickler, a former editor at McSweeney's and Wizards of the Coast with experience in online communities, who focused on user engagement and content strategy.[1] Charles Adler joined in 2006, contributing web design and development expertise from prior ventures in online tools.[1] The trio, later assisted by developer Andy Baio in 2008, iteratively built the prototype over several years, emphasizing an all-or-nothing funding model to align incentives between creators and backers.[1] The platform launched publicly on April 28, 2009, at 4:27 p.m. EST, initially hosting projects in categories like music, film, and art.[8] Early projects included Chen's own music endeavor and singer-songwriter Allison Weiss's debut album, which reached its goal within one day, demonstrating immediate viability.[1] Operating from founders' apartments initially, Kickstarter incorporated as a for-profit public benefit corporation in New York, prioritizing creative projects over equity crowdfunding to foster non-commercial artistic expression.[1] By January 2010, the team expanded into a dedicated office in Manhattan's Lower East Side, adding staff like Cassie Marketos for community management and Fred Benenson for product development.[1] Growth accelerated steadily through 2012, with 3,910 projects successfully funded in 2010, raising $27,638,318 from backers selecting rewards like early access or merchandise.[9] In 2011, successful projects surged to 11,836, reflecting broader adoption amid economic recovery and rising interest in independent creation; by October, backers exceeded 1 million, with repeat supporters comprising about 16% of the total.[10] Project success rates hovered between 40% and 45%, higher than later averages due to smaller goals and niche communities in early years.[11] Milestones included the first project surpassing $1 million in pledges—Casey Hopkins's Elevation Dock iPhone accessory—on February 9, 2012, alongside reaching 100,000 successful projects overall.[12] This period established Kickstarter's model of democratized funding, though it also highlighted dependencies on viral promotion and creator fulfillment capabilities.[13]Expansion and Key Milestones (2013–2020)
In 2014, Kickstarter achieved a significant funding milestone when total pledges surpassed $1 billion on March 3, marking cumulative support from 5.7 million backers across creative projects.[14] [15] This rapid growth reflected the platform's expanding user base and project volume, with over half of the $1 billion pledged in the preceding 12 months alone.[16] Platform statistics indicated sustained increases in successful projects, particularly in technology and design categories, driven by high-profile campaigns like the Coolest Cooler, which raised $13.28 million in August 2014 and became the most-funded project to date.[17] International expansion accelerated during this period, broadening access for creators beyond North America. On September 9, 2013, Kickstarter enabled project creation from Canada, followed by launches in Denmark, Norway, Sweden, and Ireland on September 15, 2014. By August 31, 2016, the platform entered Asia with support for projects based in Hong Kong and Singapore, its first markets in the region.[18] These additions facilitated localized currency pledges and compliance with regional regulations, contributing to diversified backer participation while maintaining the all-or-nothing funding model. A pivotal corporate restructuring occurred on September 20, 2015, when Kickstarter reincorporated as a public benefit corporation (PBC), legally committing to balance profit with public benefits such as advancing arts, culture, and community support.[19] [20] This status obligated the company to donate 5% of annual post-tax profits to initiatives addressing arts education and economic inequality, with no opposition from shareholders or founders.[20] The change aligned with Kickstarter's charter emphasizing ethical practices and creative ecosystem sustainability.[21] Key project successes underscored the platform's influence, including the Pebble Time smartwatch campaign in February 2015, which raised $20.3 million from over 78,000 backers and set a new funding record.[22] Subsequent milestones included Shenmue III's $6.33 million for video game revival in 2015, Pebble 2's $12.78 million in 2016, and Kingdom Death: Monster's $12.4 million for tabletop gaming. [23] By 2016, Kickstarter projects had generated approximately 283,000 temporary jobs, highlighting economic ripple effects.[24]Recent Evolution and Challenges (2021–Present)
In the period from 2021 onward, Kickstarter experienced steady but uneven growth amid broader crowdfunding market maturation. By August 2025, the platform had facilitated over $8.7 billion in total pledges from more than 24.47 million backers across approximately 650,000 projects, with a funding success rate stabilizing around 42 percent.[25][26][27] However, category-specific trends revealed slowdowns, particularly in tabletop games, where 2024 dollars raised remained flat year-over-year, prompting competitors like Gamefound to gain market share and aim to dominate the niche by 2025.[28] To counter this, Kickstarter announced a 2025 product roadmap featuring enhanced funding tools, improved backer interfaces, and trust-building mechanisms such as better project verification, reflecting efforts to adapt to creator demands and retain dominance.[29] Emerging trends included rising interest in AI-integrated projects, sustainable initiatives, and gaming, with the first half of 2025 showing resilience despite post-pandemic adjustments.[30] Internally, Kickstarter grappled with labor challenges following its 2020 unionization vote, as workers under Kickstarter United ratified their first collective bargaining agreement in June 2022 after protracted negotiations.[31] Tensions resurfaced in 2025, culminating in an October strike authorization by 85 percent of union members over demands for a four-day workweek, minimum salary guarantees, and protections against outsourcing, highlighting ongoing disputes over work conditions in a remote-heavy tech environment.[32] Persistent challenges included fraud and fulfillment risks, with approximately 9 percent of projects failing to deliver rewards and 8 percent of pledged dollars tied to such failures, eroding backer confidence.[33] Reports of scams proliferated, including deceptive campaigns misusing funds or vanishing post-funding, as documented in analyses of over 100 fraudulent cases from 2021 onward, often involving unverified creators or exaggerated prototypes.[34][7] Backer complaints, such as unresolved 2021 projects, underscored criticisms of the platform's limited intervention, as Kickstarter's all-or-nothing model and refund policies rely heavily on creator accountability rather than proactive vetting, exacerbating risks in a saturated market with declining novelty appeal for some categories.[35] These issues, compounded by regulatory gaps in crowdfunding oversight, have prompted calls for stronger verification tools, though implementation remains incremental.[36]Business Model
Core Funding Mechanics
Kickstarter employs an all-or-nothing funding model, requiring projects to establish a specific monetary goal and a fixed campaign duration, typically ranging from 1 to 60 days. Backers submit pledges during this period, but charges are only processed if the total pledged amount meets or exceeds the goal by the deadline; failure to do so results in automatic cancellation of all pledges, with no funds exchanged and no obligations incurred by backers.[37][38] This approach, adopted at the platform's inception on April 28, 2009, seeks to safeguard creators by ensuring they receive adequate capital to fulfill commitments, while mitigating backer risk from underfunded ventures that might otherwise lead to incomplete deliveries.[39] Pledges represent commitments from backers, often tied to tiered rewards such as early access to products, exclusive merchandise, or personalized acknowledgments, which creators detail in their campaign descriptions. The platform authorizes payment methods like credit cards at pledge time but holds off on final collection until success is confirmed, allowing backers to withdraw or adjust pledges beforehand if desired. Creators determine funding goals based on projected expenses—including production, materials, shipping, and platform fees—to cover the minimum viable execution of the project, with recommendations emphasizing conservative estimates to account for uncertainties.[40][41] Successful campaigns incur a 5% platform fee deducted by Kickstarter from the gross funds raised, alongside payment processing charges handled by third-party providers. In the United States, these processing fees equate to 3% plus $0.30 per pledge, or a discounted 5% plus $0.08 for pledges under $10 to encourage smaller contributions; international rates vary by region and currency. Unsuccessful projects incur no fees, preserving creator resources for future attempts, though creators must still manage any preparatory costs independently.[42][43]Project Categories and Eligibility
Kickstarter classifies projects into 15 primary categories to organize creative endeavors and facilitate discovery by backers: Art, Comics, Crafts, Dance, Design, Fashion, Film & Video, Food, Games, Journalism, Music, Photography, Publishing, Technology, and Theater. Each category encompasses subcategories for more precise alignment, such as Ceramics or Illustration under Art, Tabletop Games under Games, or Gadgets under Technology; creators select one primary category and optional subcategory during project setup, as projects cannot span multiple main categories.[44] This structure, established since the platform's early years and unchanged as of 2025, prioritizes creative output over commercial ventures, with Games, Design, and Technology historically dominating in pledges raised.[45] Eligibility requires projects to embody a discrete creative goal with a defined timeline and deliverable rewards to backers, excluding pure fundraising, charity drives, equity offerings, or prohibited items like offensive materials, drugs, or weapons.[46] Creators must be at least 18 years old, residents of supported countries (including the United States, Canada, United Kingdom, and select others in Europe and Asia-Pacific as of 2024), and possess a valid debit or credit card for potential fees; business entities and nonprofits qualify if meeting these criteria and structuring campaigns as reward-based rather than investment-seeking.[47] [48] Projects undergo pre-launch review for compliance, with violations leading to suspension; the all-or-nothing funding model mandates full goal attainment within 30-60 days or refund of pledges.[46] [49]Economic Structure and Platform Revenue
Kickstarter employs an all-or-nothing funding mechanism, requiring projects to meet or exceed their creator-set funding goal within a specified campaign duration—typically 30 days, though extendable to 60 days—before any pledges are collected from backers; failure to reach the goal results in no charges to backers and no funds disbursed to creators.[41] This structure minimizes financial risk for backers and incentivizes creators to propose viable projects with realistic goals, as unsuccessful campaigns yield zero revenue for the platform.[50] Upon successful funding, Kickstarter deducts a flat 5% platform fee from the total amount raised, applied to the gross pledge total before any refunds or adjustments.[42] [43] Payment processing fees, managed via Stripe, add 3% to 5% of the total plus fixed per-transaction charges of approximately $0.20 to $0.30 per successful pledge, varying by pledge amount and backer location.[42] [51] Creators receive the net amount after these deductions, with no upfront listing or subscription fees required to launch a campaign.[50] The platform's revenue model relies exclusively on these success-based fees, generating income solely from funded projects without charging for unsuccessful ones, which accounted for the majority of campaigns given a historical success rate of approximately 38% as of early 2025.[27] In 2024, this yielded platform revenue estimated in the range of $9.5 million, derived from fees on roughly $706 million in total pledges across 35,512 launched projects.[52] [53] No evidence indicates significant alternative revenue streams, such as advertising or premium services, with the fee structure prioritizing alignment between platform viability and project success.[54]Operational Guidelines and Risk Management
Creators must be at least 18 years old and permanent residents of eligible countries, with access to a valid debit or credit card and, for U.S.-based projects, a U.S. Social Security Number or Employer Identification Number for tax purposes.[55] Projects operate under an all-or-nothing funding model, where funds are only collected if the goal is met within the set duration, typically 30 days, emphasizing community validation before commitment.[56] Operational rules mandate that projects produce tangible creative outputs shared with backers, with strict prohibitions on charity fundraising, equity offerings, financial incentives, or items like prohibited weapons and offensive materials.[46] Honesty in project descriptions, statistics, and prototypes is required; for hardware and product design, working prototypes must be demonstrated, barring photorealistic renderings that could mislead backers.[57] Risk management begins with mandatory disclosure of potential challenges in a dedicated "Risks and Challenges" section, compelling creators to outline realistic hurdles such as production delays or technical issues to inform backer expectations.[58] Backers bear primary responsibility for assessing these disclosures, project updates, and creator track records, as Kickstarter explicitly states it functions as a platform for experimentation rather than a retail guarantee, offering no inherent protections against non-delivery.[59] Creators are obligated to fulfill promised rewards or provide refunds where feasible, or transparently explain failures, with the platform facilitating creator-initiated refunds post-funding but retaining its 5% fee plus processing costs unless specified otherwise.[58] [60] Kickstarter's Trust and Safety team enforces compliance through account suspensions or project bans for violations like fraud or misrepresentation, though it does not proactively verify fulfillment, relying instead on reported issues and community vigilance.[58] This decentralized approach mitigates platform liability but exposes backers to inherent crowdfunding uncertainties, with empirical data indicating that while most projects deliver, a subset—estimated at around 10-15% based on creator self-reports—face significant delays or partial non-fulfillment, underscoring the causal link between optimistic projections and execution risks.[46] Legal recourse for backers remains limited to creator contracts or external claims, as the platform's terms disclaim retailer status and emphasize creator accountability.[61]Notable Projects
Highest-Funded Successes
Kickstarter's highest-funded successful campaigns have largely featured consumer technology, board games, and publishing initiatives, demonstrating the platform's appeal for ambitious hardware and creative content. These projects exceeded their funding goals by wide margins, often surpassing 2,000% of targets and attracting tens of thousands of backers. The record for the most funded project is held by eufyMake's E1, a personal 3D-texture UV printer launched in April 2025, which raised $46,762,258 from 17,822 backers over 60 days, achieving 9,352% of its $500,000 goal.[62] This eclipsed the prior benchmark set by author Brandon Sanderson's "Surprise! Four Secret Novels" in March 2022, a self-publishing effort for four unpublished fantasy books with exclusive editions and merchandise, totaling $41,754,153 from 185,341 backers.[63] Earlier standouts include the Pebble Time smartwatch in 2015, which garnered $20,338,986 from 78,471 backers for a color e-paper display device compatible with smartphones.[64] The Coolest Cooler, a multifunctional ice chest with integrated blender and speaker, collected $13,285,226 from 62,642 backers in 2014, though the company later encountered severe fulfillment difficulties leading to bankruptcy.[65] The board game Frosthaven, sequel to Gloomhaven, raised $12,969,608 from 83,193 backers in 2020, establishing it as the highest-funded tabletop game on the platform at the time.[66]| Project | Funding Amount | Backers | Year | Category |
|---|---|---|---|---|
| eufyMake E1 | $46,762,258 | 17,822 | 2025 | Technology |
| Four Secret Novels | $41,754,153 | 185,341 | 2022 | Publishing |
| Pebble Time | $20,338,986 | 78,471 | 2015 | Technology |
| Coolest Cooler | $13,285,226 | 62,642 | 2014 | Consumer Goods |
| Frosthaven | $12,969,608 | 83,193 | 2020 | Games |
Influential Creators and Case Studies
Eric Migicovsky's Pebble campaigns exemplify serial success in hardware crowdfunding. The initial Pebble E-Paper Watch launched on April 23, 2012, raising $10,266,845 from 68,929 backers and establishing viability for smartwatch development outside traditional venture funding.[67] The 2015 Pebble Time follow-up exceeded $20 million in pledges, reinforcing Migicovsky's influence in iterating on consumer electronics through repeated platform use.[68] In video games, Tim Schafer's Double Fine Adventure, initiated February 8, 2012, collected $3,336,371 from 87,142 backers, demonstrating how established creators could fund narrative-driven titles by appealing directly to enthusiasts disillusioned with industry shifts toward mobile gaming.[69] Similarly, Brian Fargo's inXile Entertainment leveraged Kickstarter for Wasteland 2 in 2012, raising over $2.9 million to resurrect a classic RPG series and stabilize the studio, followed by Torment: Tides of Numenera in 2013, which further validated crowdfunding for role-playing game revivals.[70] Elan Lee's Exploding Kittens card game, launched January 29, 2015, secured $8,782,571 from 219,382 backers—the highest backer count in platform history at the time—illustrating the draw of simple, viral tabletop designs co-created with artist Matthew Inman.[71] For niche markets, Stefan Pokorny's Dwarven Forge ran multiple campaigns for modular miniature terrain, cumulatively raising about $6.5 million by mid-2015, fostering a dedicated community among tabletop gamers through high-quality, customizable products.[72] These cases highlight creators who not only achieved funding but scaled operations, influencing category-specific strategies on Kickstarter.Documented Failures and Cancellations
The Coolest Cooler, launched in July 2014, raised $13,285,226 from over 62,000 backers for a multi-functional cooler featuring a blender, speaker, and USB charger. Despite initial production attempts, the project faced chronic delays, quality issues, and escalating costs, culminating in the company's shutdown in December 2019, with approximately 20,000 backers receiving no product despite pledges averaging $185 plus shipping.[73][74] The Zano mini-drone campaign, active in late 2014, secured £3.74 million (approximately $5.7 million) from nearly 10,000 backers promising autonomous swarming drones with HD cameras. Technical flaws, including unstable flight control and battery life shortfalls, combined with mismanagement, led to the creator Torquing Group's liquidation in January 2015, with only a handful of non-functional prototypes shipped and most backers receiving nothing.[75][76] Amabrush, a 2017 automatic toothbrush project raising about $3.4 million, aimed to clean teeth in 10 seconds via a mouthpiece design but collapsed into bankruptcy in 2019 due to manufacturing sourcing failures and cost overruns, leaving backers without deliverables.[6] Skarp, a 2015 laser razor campaign that garnered $4 million by claiming hair-melting technology, suspended operations after prototypes proved ineffective and violated platform guidelines on unproven tech, resulting in partial refunds for some but widespread dissatisfaction.[6][77] Independent analyses indicate that around 9% of funded Kickstarter projects fail to deliver rewards, often attributable to underestimation of production complexities in hardware categories.[7] Cancellations post-funding remain rare but occur in cases of insurmountable technical barriers or creator abandonment, with Kickstarter facilitating refunds where funds remain accessible, though recovery varies.[3]Economic and Industry Impact
Quantitative Performance Metrics
Kickstarter has amassed $9,233,011,162 in total pledges across its projects.[3] This funding has supported 287,875 successfully funded projects, with contributions from 24,770,172 unique backers who have made 105,619,348 pledges in total.[3] Among these backers, 8,641,401 are repeat supporters, indicating sustained platform engagement.[3] The average pledge amount equates to approximately $87.50, derived from total pledges divided by the number of individual contributions.[3] Success rates for projects reaching funding goals hover around 39-40%, with independent analyses placing the global figure at 39.11% based on historical data up to late 2024.[45] Official metrics highlight that 9% of projects receive no pledges at all, while 79% of those surpassing 20% of their funding goal ultimately succeed.[3] Most successful projects raise under $10,000, though outliers have achieved seven- or eight-figure sums, underscoring a skewed distribution toward modest campaigns.[3] Post-funding performance reveals challenges in delivery: 9% of projects fail to provide rewards to backers, accounting for 8% of pledged dollars directed to such failures and affecting 7% of backers who receive nothing.[33] These metrics reflect Kickstarter's role in channeling funds primarily to smaller-scale creative endeavors, with limited scalability for high-volume successes amid high attrition in early pledge phases.| Metric | Value | Source |
|---|---|---|
| Total Pledges | $9,233,011,162 | [3] |
| Successful Projects | 287,875 | [3] |
| Total Backers | 24,770,172 | [3] |
| Total Pledges Made | 105,619,348 | [3] |
| Projects with Zero Pledges | 9% | [3] |
| Delivery Failure Rate | 9% of projects | [33] |
Broader Effects on Innovation and Markets
Kickstarter has democratized access to capital for early-stage innovation, particularly in creative and consumer product sectors, by enabling creators to secure funding from dispersed backers without relying on institutional investors. Empirical evidence shows that heightened Kickstarter activity correlates with increased entrepreneurship; for instance, a doubling of funded projects at the county-industry level between 2009 and 2018 was associated with a 3-5% rise in new business formations, especially in industries requiring lower startup capital.[78] This mechanism has lowered barriers to entry, allowing niche ideas to reach markets that traditional financing might overlook, thereby fostering a broader range of product experimentation and market testing prior to production.[79] The platform's all-or-nothing funding model provides a built-in signal of viability, as successful campaigns validate demand and build early customer bases, which can accelerate product development cycles and reduce inventor risk. Research highlights how crowdfunding enhances innovation by facilitating pre-market feedback loops, enabling entrepreneurs to refine offerings based on backer input and establish brand loyalty that extends beyond the campaign.[80] A 2016 University of Pennsylvania analysis of Kickstarter's ecosystem estimated that backers viewed over 50% of projects as innovative, with more than 4,200 patents filed in connection to funded initiatives, underscoring tangible contributions to intellectual property generation in fields like design and technology.[24] However, Kickstarter's influence on markets reveals limitations in promoting breakthrough innovation, as backers often prioritize familiar, incremental improvements over high-risk, disruptive concepts, potentially skewing capital toward safer bets that align with existing consumer preferences rather than pioneering shifts.[81] This crowd-driven conservatism can lead to market saturation in popular categories, such as consumer electronics, where numerous similar projects compete, diluting individual impact and straining supply chains for small-scale producers. Nonetheless, the platform has expanded niche markets by scaling demand for specialized goods, contributing to economic spillovers like job creation in creative industries—estimated at over 10,000 full-time equivalents from successful projects as of 2016—while challenging incumbents to respond to faster, more agile entrants.[24]Competitive Landscape and Alternatives
Kickstarter operates within the reward-based crowdfunding segment, where backers receive non-financial perks such as products or experiences in exchange for pledges, distinguishing it from donation, equity, or lending models. The platform's all-or-nothing funding mechanism—requiring projects to meet or exceed their goal to receive funds—prioritizes commitment but contrasts with competitors offering greater flexibility. As of 2024, the global crowdfunding market was valued at approximately USD 1.60 billion, with projections to reach USD 1.83 billion in 2025, driven by diverse platforms catering to creative, tech, and entrepreneurial needs.[82] Indiegogo emerges as Kickstarter's primary rival in reward-based crowdfunding, having facilitated over $1 billion in pledges since 2008, with a focus on technology and innovation projects that often continue funding post-campaign via its InDemand feature.[83] Key differences include funding flexibility: Indiegogo permits creators to retain partial funds even if goals are unmet, reducing risk compared to Kickstarter's binary success model, which has led some projects to migrate for ongoing sales potential. Both charge a 5% platform fee plus 3-5% payment processing, but Indiegogo's broader post-campaign tools appeal to hardware startups, as evidenced by successful gadgets like the Flow Hive raising millions. Patreon, by contrast, shifts to a subscription-based model for recurring creator support, amassing over $4 billion in payouts to artists and podcasters by 2024, ideal for ongoing content rather than one-off launches.[83][84] GoFundMe dominates donation-based crowdfunding for personal and charitable causes, processing billions annually with no platform fee (only 2.9% + $0.30 processing), but lacks reward structures, making it unsuitable for product development.[85] Equity crowdfunding platforms like StartEngine and Wefunder provide alternatives for startups seeking investment returns rather than perks, regulated under U.S. JOBS Act provisions allowing non-accredited investors. In 2024, StartEngine raised over $10 million across campaigns, emphasizing scalability for businesses beyond Kickstarter's creative scope. Crowdcube and Seedrs, prominent in Europe, have funded thousands of companies with equity stakes, aggregating over €1.5 billion by 2023. These models introduce investor protections and potential dilution risks absent in reward crowdfunding, appealing to ventures prioritizing capital over community validation.[86]| Platform | Funding Model | Platform Fee | Primary Focus |
|---|---|---|---|
| Indiegogo | Flexible reward/InDemand | 5% | Tech, gadgets, ongoing sales |
| Patreon | Subscription/donation | 5-12% | Recurring creator support |
| GoFundMe | Donation-based | 0% (processing only) | Personal causes, emergencies |
| StartEngine | Equity (Reg CF) | 7-10% | Startup investments |