Today we’ll talk about how to develop your crowdfunding platform like Kickstarter, creating a clone of this site with a similar design and identical functionality. This is the easiest and most affordable way to enter the crowdfunding market, which will grow rapidly over the next 5-6 years.
Step 1: Kickstarter Business Model
The platform has one of the simplest business models: the service is an intermediary that brings together those who need money to finance a variety of projects with those who are ready to become their sponsors. For its services, the platform charges a commission of 5% on each successfully funded project.
As a funding model for crowdfunding campaigns, Kickstarter uses an award-winning, all-or-nothing approach. That is, the initiators of the fundraising company will receive money only if they are able to collect the minimum amount indicated by them. If this does not happen, the system returns the money to the sponsors in full (minus transaction costs).
Kickstarter attracts users with 4 value propositions:
- Anyone can become the initiator of the crowdfunding campaign or its sponsor, regardless of location, profession, education and current work. The main thing is to have a network connection, an idea or a desire to financially help the embodiment of someone else's idea. Kickstarter is famous as "From Rags to Riches.". What is worth only campaign to raise money for the preparation of potato salad, which raised 55,500 dollars. And there are Exploding Kittens, Peak Design, Oculus Rift, Coolest Cooler and thousands of other successful projects from unknown people.
- Risk reduction. In 2014, the system introduced an “algorithmic initial scan” of projects that determines whether the project can be started now as it is, or whether it needs to be verified by a person. If the system indicates a human check, the project checks the Integrity Group, which scans the campaign for a variety of parameters, in order to understand whether the project is “worthy” of sponsor support, is it fraud, does the campaign comply with the rules and ethical standards of the site.
- Simplicity and convenience. Finding out what and how to do is very simple - everything is intuitive, even when creating a crowdfunding campaign. The service has a nice design and a huge number of functions that are designed for a wide range of niches and target audiences. At the same time, the system does not slow down and works on all popular platforms (Web, Win, iOS, Android).
- Brand / Status. 80% of projects that failed on Kickstarter that received more than 20% of the required amount, as a result, still find a “complete” fix. Among those who received more than 60% of the required amount, 98% of projects find "full" support. Thus, even if startups have not collected the required amount on Kickstarter, they can still boast that they have reached the bar of 20% and higher, and use this in marketing.
Step 2: Niche and Target Audience
Creating your crowdfunding platform like Kickstarter, copying its business model and functionality, you should understand that you are unlikely to be able to become better and more successful than the original in its market. Therefore, you need to bet on other niches, regions and / or target audiences. To find a promising niche for your Kickstarter clone, you need to analyze the market and target audience.
Competitive and comparative analysis. It's about analyzing both the market as a whole and its individual niches for the presence of competitors for your Kickstarter clone. If there are competitors, you need to compare them with Kickstarter and see if its clone will be competitive in this market. In this case, you need to compare both design and orientation, mission, business model and other important things.
If you are
targeting popular countries and niches, you are likely to find a good up-to-date comparative analysis of Kickstarter and its competitors. If you plan to
create a crowdfunding platform for narrow niches and / or countries where few people speak English, then the analysis will need to be done independently.
Research of potential users. It is necessary to determine their preferences, needs, fears, pains and other socio-demographic characteristics. In this case, you need to divide all people into three main categories (as Kickstarter marketers did):
- Creators (campaign initiators, crowdfunders). These are people or teams who launch crowdfunding campaigns and work on the implementation of the idea. It is forbidden to raise funds on Kickstarter for other people's projects. Money should go directly from the sponsor to the campaign initiator (through the site system in order to charge a commission and thus make a profit).
- Backers (donors, sponsors, investors). These are people who have confirmed that they are ready to contribute money to a particular project on the site. They are the majority, and anyone who has reached the age of majority can become them. In fact, they are the main ones, since it is these users who give money. Therefore, creating a crowdfunding platform, sharpen its design and functionality for these people. And marketing, first of all, should be focused on them.
- Subscribers (followers, subscribers). These are people who regularly contribute money to a project or business in order to participate in its long-term development and receive some benefits. This group in Kickstarter began to be allocated in 2016 to increase user loyalty.
You can analyze potential users in a variety of ways, for example, by analyzing users of competitors, conducting screening surveys, studying forms and
social networks (groups, communities), etc. The exact method depends on the country and the target audience. For example, it would be foolish to conduct polls through the
popular Slack messenger in the USA and Western Europe if you are targeting Russia or, conversely, use the Russian Vkontakte social network to analyze the target audience in the USA or Western Europe.
Creating Typical User Persons. When you have a user analysis in your hands, you need to create images of typical characters based on it that want to use your site. And since we have three user roles, then there must be at least three such characters. Better more: segment the target audience not only by their roles (initiator, sponsor, subscriber), but also by main socio-demographic roles (middle-income businessman, professional investor, startup student, etc.).
Step 3: main platform features
Key features to implement in the Kickstarter clone
Next, you need to study the functions of the
Kickstarter website and application in order to “clone” them on your platform. But this should be done not thoughtlessly, like a copy machine, but focusing on a niche and target audience. Direct competitors (how they implemented these or those functions) and users' personalities (what and in what form they would like to see / use you will help you in this).
For example, the Patreon platform, sharpened by creative personalities, has a well-implemented paid access to hidden content, premium services or direct contact (chat, video, meeting, etc.) with the creator of video content, photographer, writer, artist, blogger or another project initiator.
Patreon Fran Meneses page with multiple sponsor packages
Another competitor, GoFundMe's charity site, has more opportunities to create a catchy
crowdfunding project page. In SeedInvest, project cards are customized for presentations of commercial projects. Mightycause focuses on social / charitable initiatives while
providing more marketing opportunities.
In a word, when creating a crowdfunding platform, always focus on the target audience, develop the design and functions specifically for it. Just do not overdo it, the interface of the site should be familiar and clear, otherwise you will create a feeling of discomfort for the visitor, and he will leave your site. The basic principles of a good Kickstarter clone are as follows:
- Recognizable interface. Above is a list of sections, a hamburger with a traditional menu on the top right or left, listing in the form of cards, as on real estate listings, as well as a clean and minimalistic design.
- Pleasant color scheme. A small number of colors that the user will associate with your niche and you through perceptive and direct associations. The same goes for typography.
- Mobility / adaptability. The design should be adjusted to the resolution of the visitor’s device so that it doesn’t go out of the screen, and at the same time basic information is present. It is also advisable to develop a mobile application, as most users will prefer to use it rather than a browser.
- Payment solutions. Kickstarter uses the Stripe payment gateway (3-5% commission). However, it is not a fact that you need to use it either. As in the case of UX / UI, you need to focus on the target audience. What it uses is what needs to be implemented. More about this in the article "How to Choose and Integrate a Payment Gateway on the Site".
Step 4: Marketing Strategy
Despite the fact that all crowdfunding projects are primarily aimed at sponsors and investors, your marketing strategy should begin with
attracting crowdfunders. After all, if you do not have projects in which you can invest money, then the sponsors will have nothing to do on your site. There are several ways to find people who initiate campaigns:
Personal contacts. If you know someone who wants or plans to start a campaign, it is better to talk to him first. If none of your friends or family members wants to conduct a campaign, you need to resort to finding these people online and try to contact them in person. The Internet is full of such listings, but you can still try to lure people from competitors.
Online communities. Then you can go to viewing forums and groups on social networks where crowdfunders and sponsors communicate. There are a lot of similar communities in every country and niche. Here are some of the most popular:
Various messengers. In addition, you can also search for potential crowdfunders in instant messengers (personal contacts, group). At the same time, you also need to focus on the target audience, since different messengers are popular in different regions, and people can speak different languages. You can find contacts of potential users and group names using search engines and the communities listed in the table above.
Email Newsletters. Now many people consider the e-mail newsletter to be archaic, but with the right headline and content - this is still one of the best ways to promote the price / number of people involved. Addresses can be found in communities using search engines and in contacts on competitors' websites. You can also search for crowdfunders in startup listings.
Content marketing. Creation of various content to attract the target audience: SEO texts, videos, webinars, podcasts, infographics and more. It is relatively expensive and takes time, but the result is more than paying off. And such content does not work until the advertisement lasts, but for several months and even years. However, it is worthwhile to understand that this marketing channel is a job for the future, since it is unlikely to give a quick effect.
You can attract sponsors in the classic ways described in the article “Best Digital Marketing Strategies for Startups”. And this is best done with the help of an outsourcing agency. It is cheaper, more efficient and much easier. We wrote about the search for the best company in the article “How to Choose an Advertising or Marketing Agency”.
Step 5: MVP Development
When you know exactly which crowdfunding platform you want to create, you can start creating a minimum viable product (MVP). This is best done with a technique called function prioritization. Its essence is to take the pains, desires, pleasures, preferences and behavior patterns of user characters and compare them with the functions of the created platform.
Then these functions should be divided into 4 groups according to the MoSCoW method, which was used in Kickstarter to partially change the business model and create several additional functions. That's what these groups should be:
- M— must be necessary, as they satisfy the basic requirements of users or bring the most pleasure.
- S— it is very desirable to implement, but the success of the project does not depend on them, so you can postpone it for later.
- C — it is advisable to implement, since they affect something secondary.
- W— would be appreciated, but not much, so you can postpone.
The MoSCoW method will help determine which functions should be implemented in MVP in the first place, which in the second and which in the last, which is important with a limited budget and time. Here's what it looked like when the Kickstarter team developed features for a new user group - subscribers.
Next, you or the development company need to create MVP sketches.
And user paths for all roles.
After that, you can proceed directly to coding the MVP clone of the Kickstarter crowdfunding platform, which can take from several months to a year of real time. After the first prototype is ready, it needs to be tested: first with the help of QA-, QC-specialists, and, when most errors and shortcomings are eliminated, by real users.
After problem solving and testing in real conditions, MVP can be launched or continued to develop. Both options have their pros and cons, but the main thing to understand is that if a market with low competition or competitors appears soon, then you need to launch the product on the market as soon as possible, if the market is full of competitors, then the product must first be finished off.
Cost issue
If you plan to compete directly with Kickstarter, you need to invest at least $ 500,000. The development of a simpler site with a basic set of functions will cost from 3,000 to 10,000 without taking into account the marketing budget, but such a product will be good for a market where there are no competitors. Niche projects will cost a little more, depending on the list of additional features.
More details about this, as well as how much marketing, licensing and technical support of crowdfunding platforms cost, are in the article “How much does it cost to launch a crowdfunding site”.
