What happens if kickstarter project is not funded

When it comes to crowdfunding on Kickstarter, creators are often worried about what happens when Kickstarter fails. With a success rate of Kickstarter operates on a All or Nothing Model, which means if you meet your funding goal, you get all your money.

Well, this is where things get complicated. If the project creator fails to deliver, it is bad press for them. This is one reason why backers are extremely cautious of funding projects that do not already have a prototype or some sort of legitimacy proving its validity. A situation like this is troublesome for everyone involved.

We highly discourage project creators to misuse the platform for personal gains. In doing so, you not only ruin the market for others but are also robbing genuine backers of their hard-earned money.

His company, Palomino Labs , turned to Kickstarter to fund a digital board game called Rumrunners. We did press outreach too. In hindsight, Ausanka-Crues says there are a lot of things he would do differently, given a second chance. He offers these lessons to other entrepreneurs who are intrigued by Kickstarter as a fundraising tool:. Having a following in place before you launch a project is crucial, Ausanka-Crues says.

Find where your market lives, and go talk to them. Involve them in the process before the Kickstarter starts. To be successful, you need an existing customer base that you can tap on day one. To be successful, Ausanka-Crues says you should reach at least 10 percent of your goal on your first day. Kickstarter staff look at your proposed project and provide feedback. For this reason, it makes sense to launch a Kickstarter campaign through a legal business structure, such as a Limited Liability Company LLC , as opposed to posting it as an individual.

A traditional kickstarter is a device that sets something in motion. Kickstarter uses an all-or-nothing funding approach, so projects only receive funding if they reach their goal. In other words, if your project or idea does not reach its original funding goal, then funds are not collected and no money is paid out.

The name on the kickstarter profile is just like the name on an LLC. You absolutely do need to use your real name for so many reasons. Kickstarter must approve all projects before they can go live. Approval can take up to three days. While LLCs are still able to create offerings on StartEngine, their corporate documents do not lend themselves well to Equity Crowdfunding. Otherwise, business recipients must be owned by a business account. Perhaps the most significant difference is that if you want to use Kickstarter for a new product, you must have a prototype to show potential backers.

Kickstarter only allows device and new product projects that already have an existing prototype. The takeaway: Kickstarter has a higher success rate because of its quality control and more selective process. Helpful tips. Can you lose money on Kickstarter? What happens if Kickstarter project is overfunded?

Which is better Kickstarter or GoFundMe?