Indiegogo vs Kickstarter: Explaining the crowdfunding giant pros and cons
Crowdfunding has grown into a widely used method for financing over the decades, making it a popular choice for launching products, funding new businesses, and building equities within businesses.
If you're considering crowdfunding or just looking for a new way to market your business or product, you've probably heard of Indiegogo and Kickstarter. They are the two largest and most well-known platforms for reward-based crowdfunding today.
But what are the main differences between the two platforms? What would make you choose one over the other?
In this article, we'll explain how Indiegogo and Kickstarter work, how they differ, and why they're both great options for entrepreneurs looking to launch new products, ideas or business.
Indiegogo vs Kickstarter: Understanding the crowdfunding platforms
Indiegogo
Indiegogo is an online crowdfunding platform that was founded in 2008. The site has a mission to "empower entrepreneurs and creative projects." The platform has a wide range of features that allow you to manage your campaign and receive feedback from your audience.
Indiegogo does more than assist entrepreneurs in raising capital; it also provides various services, such as marketing and prototyping, fulfillment, and distribution, licensing, to assist you in bringing your business to the target audience.
Over 800,000 projects have been successfully funded with the help of Indiegogo's community of 9 million users. There are approximately 1,200 active campaigns at any given time, in addition to about 1,800 InDemand campaigns.
Kickstarter
Kickstarter facilitates reward-based crowdfunding. It provides a forum for creators to submit projects they want to see become a reality, whether they be innovative new products they wish to mass-produce or pieces of art they want to design.
It also makes it easy for backers to look through the projects and find ones they want to support. Kickstarter helps creators and backers get in touch with each other, and in exchange, it takes a small cut of the money raised by successful projects.
According to statista.com, the total money pledged to projects on Kickstarter grew steadily from July 2012 to November 2022. As of November 2022, the total value of the pledges was about $6.95 billion.
Indiegogo vs Kickstarter: Pros and cons
If you're looking for a crowdfunding platform to help you start your business, Indiegogo and Kickstarter are both great options. Both have different strengths and weaknesses, so let's compare them.
Method of Financing
Indiegogo has two methods of funding;
All or Nothing
Flexible Funding: Regardless of whether the campaign is successful, you will receive the whole amount minus fees.
Kickstarter also uses the all-or-nothing funding method. They only disburse the funds once the campaign has been completed. This arrangement guard and prioritizes the funders and patrons.
Indiegogo is geared more toward campaigns, whereas Kickstarter caters to the backers.
Eligible Countries
Indiegogo allows companies from over 200 countries to open a campaign. However, Kickstarter only allows creators or companies from 25 countries to launch campaigns. Still, both allow people from all over the world to back or fund a project. If you want your campaign to reach people worldwide, Indiegogo may be a better choice.
Rewards
There is a tiered system for the rewards offered on Kickstarter. In contrast, Indiegogo offers regular benefits comparable to the prizes offered on Kickstarter. They also provide hidden advantages that can only be accessed through specific URLs.
They are widely utilized in sales promotions for discounts, and it is simple to keep track of them. Add-ons are available on both platforms, so you may customize your experience as you go along.
Prototype
You don't need a prototype if you're running a campaign on Indiegogo. It would be great if you had one, but you can still start your campaign without it.
It is compulsory to have a working prototype to show your backers before you can start a Kickstarter campaign.
Remarketing Efforts
Kickstarter supports Google analytics, but you can't integrate Facebook pixel.
Indiegogo is more open to creators and gives them more options to add more pixels to give them visibility and tracking to build a successful campaign.
Fees
Both Indiegogo and Kickstarter deduct a percentage of the total cash raised as their fee for executing the transaction (after all, this is how both platforms generate revenue to support their operations).
Kickstarter takes 5% of your money but only charges that fee if you reach your goal. Their costs for processing payments range from 3% to 5%. To learn more about Kickstarter's fee, click here.
Indiegogo also takes 5% of all the money you raise, not just the amount you set as your goal. Stripe, which handles its credit card transactions, charges 5% plus $0.30 per transaction as a processing fee. Since Indiegogo is used worldwide, international transfers and different banks may charge extra fees. To learn more about Indiegogo fees, click here.
Niches
Music and movies, board games, product design, fashion, and travel gear have the most successful fully-funded projects on Kickstarter. Kickstarter is a platform that focuses more on creativity and innovation.
Indiegogo is yet to disclose specific statistics on which industries perform well. However, third-party observations show that technology and hardware items perform better. The Indiegogo audience is primarily concerned about functionality.
Indiegogo vs. Kickstarter: Which platform is best?
The Kickstarter Campaign has a success rate of 40.13%, while Indiegogo is 9%. This data can lead you to believe that using Kickstarter increases your chances of success.
It is primarily factual, but it depends greatly on what kind of product you are trying to crowdfund. Some projects on Indiegogo do better than expected, while others on Kickstarter don't perform well.
Final thought
These reward-based crowdfunding platforms are fantastic options if you're excited about crowdfunding and looking for where to launch your product or ideas.
But at the end of the day, you have to access your budget and timeline, review your target audience and decide where you think you will have the greatest success. If you would like to be in touch to discuss your current or upcoming campaign or project, please reach out.