When crowdfunding first entered the public imagination a few years ago, some people saw it as a really amazing opportunity for people with great ideas and little money to make cool things happen in the world. And that’s true.
But that potential has also been deeply diminished by events of the past couple of years.
Things are moving superfast in the realm of crowdfunding. And the ordinary start-up initiator who wants to use a crowdfunding platform as an opportunity to make an entrepreneurial (or charitable, or other) dream come true now find themselves at a very serious disadvantage.
Crowdfunding has been stolen from the crowd. To a large extent, anyway.
Big businesses, elite consultants and shady operators are manipulating an idea that was envisioned as a revolutionary way for great ideas to see the light of day.
For a huge range of reasons, though, most of these great ideas do not see the light of day.
About one in five campaigns that applies to join Kickstarter is rejected before they see the light of day. Of the ones that are approved, only about two in five get funded. So, of all the dreamers who try to raise the funds to realize their dreams on Kickstarter, about one in three succeeds. This means 66% never get funded. And of the 33% that do get funded, most of those are not super-huge, earth-shattering projects. They raise less than $10,000. Of 72,000 projects that have been funded since Kickstarter started out, about 1,600 have raised more than $100,000. That means over 70,000 Kickstarter projects raised small amounts of money.
Of course, not all projects aim for the moon (though some do).
Some of these campaigns are badly run. They are based on dumb ideas. Their marketing is poor. They don’t plan to succeed.
Yet some of them are great ideas that do everything right and fail anyway. They are marginalized by a crowd funding system that has inherent flaws and guarantees failure. How else can one explain that more than 66% of crowdfunding campaigns fail?
There are systemic problems with crowdfunding as it has evolved. We’ve written a whole series on it, starting here.
We’re also building the solution.
BidOkee has identified the problems inherent to the way crowdfunding has evolved – (it’s mainly the fault of the mega-sites that dominate the sector) – and found solutions to each of them.