“The Return of Taqueria Nueve!” was the Kickstarter page Brent Richford and Billy Schumaker created in 2013 as they worked to re-open the Portland taco joint. The original eatery had closed in 2008 and had been dearly missed by locals ever since.
The pair raised the bulk of the money for the restaurant’s revival through investors, but launched the Kickstarter to raise the remaining $25,000. The campaign brought in more than $30,000, largely because of the media attention it attracted.
“Just the fact that we were running the campaign was news in the food industry here,” Richford says. “That created hype.”
Crowdfunding with Kickstarter
Kickstarter is an online rewards-based crowdfunding platform. Anyone can create a project page to raise money for just about anything. But its all-or-nothing model means that if a project’s funding goal isn’t met, no money changes hands.
Taqueria Nueve and thousands of other businesses have successfully raised money on Kickstarter, but more projects fail than flourish. Since 2009, there have been 118,210 unsuccessful projects, compared to 77,501 successful ones. Here’s how your business can reach its fundraising goals through Kickstarter.
Create your project
To get started, create a Kickstarter login by entering your name and email address, and then begin populating your page by filling out a description of your project and the campaign’s duration. Kickstarter allows projects to run for up to 60 days, but recommends keeping it under 30 to maximize the likelihood of getting funded.
Next, set a goal for how much money you want to raise. Think about exactly what you want to spend the money on, whether it’s a new pizza oven, manufacturing costs or creating a website. Then calculate exactly how much that expense will cost. Keep in mind that if your funding goal is met, Kickstarter takes a 5% cut.
You also have the option to add photos and a video to your Kickstarter page, which you should do. Around 50% of projects with a video succeed, whereas just 30% of projects that don’t have a video get funded.
Finally, Kickstarter will prompt you to register an Amazon Payments account, which is how the donations will be transferred to you if the project is successful.
Reward your backers
You’re encouraged and expected to give rewards to people who back your campaign. Rewards can be products, services, experiences or mementos.
Richford and Schumaker set up a tiered rewards system for Taqueria Nueve’s Kickstarter page. Donors who gave $10 were promised $15 toward menu items, and backers who contributed at least $29 received an exclusive T-shirt. The prizes increased from there to reward larger contributions.
“We felt it was really important for us to give as much as we could while still maintaining a good business model,” Richford says.
Promote your project
Kickstarter reviews all projects before they launch. Once yours is live, actively promote it to friends, family and other people in your network. Richford suggests building a resource list of emails you can send the link to.
It’s common to see a stream of contributions at the beginning of your campaign and then a dry spell in the middle, as momentum wanes. “There was definitely a little lull there about two weeks in, which I guess is pretty typical,” Richford says.
If you see a slowdown in donations, continue promoting your Kickstarter through email, social media and word of mouth, and encourage your friends and family to spread the word within their circles.
Follow up
Once you reach your goal, your work with Kickstarter isn’t over — you must deliver the rewards you promised your backers. Use the Kickstarter survey tool to ask backers for an address where you can send their rewards. It helps to track donations as they come in using an Excel spreadsheet, so you know what rewards you owe which donors.
Kickstarter is just one of the many ways to fund your small business. You can find more information about funding options at NerdWallet’s small business education center.
Image via iStock.
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