The Ubuntu Edge campaign, which raised $10,267,352 on Indiegogo from more than 22,053 contributions, highlighted the enormous potential of crowdfunding campaigns. At the same time, it also highlighted the limitations of Indiegogo as compared to Kickstarter, since the campaign fell far short of its desired goal of $32 million.Kickstarter and Indiegogo, both launched at around the same time in 2008-09, are unquestionably the two big dogs in this arena. But which one is better? To be more precise, which one is better suited for your project? Let’s hash out the numbers and examine each platform’s policies.
Until recently, it was hard to compare Kickstarter vs Indiegogo because Indiegogo does not reveal statistics about the number of projects, pledges and total amounts raised. Kickstarter, however, does have a stats page that has a running tally of everything from the total amount pledged to-date for Kickstarter campaigns to detailed breakups of both successful and unsuccessful campaigns.
Here’s the Kickstarter summary (as of Sept 3, 2013)
As mentioned above, Indiegogo does not make stats similar to those above public. However,
there are a few statistics about Indiegogo floating around in the ether. A comparison of Kickstarter and Indiegogo by The Verge after the Ubuntu Edge campaign got underway says that out of a total of 142,301 projects that have ended on Indiegogo, only 9.3 percent managed to reach 100 percent of their goal.
A second source is a more recent analysis of scraped data from 4,900 pages of Indiegogo campaign pages by crowdfunding freelancers Jonathan Lau and Edward Junprung.
Lau and Junprung found 44,000 campaigns on these pages. They explain the discrepancy between their tally and the 142,301 figure quoted by The Verge by noting that Indiegogo delists campaigns that secure less than $500 in pledges.
It should be mentioned at this point that an Indiegogo spokesperson has categorically rejected the accuracy of Lau and Junprung’s analysis to many media outlets, but Indiegogo still refuses to make public its official statistics. Subject to the above caveats and the exclusion of the outlier Ubuntu Edge campaign from the analysis, here’s the summary of
Based on the numbers, successful Kickstarter campaigns have raised six times as much as Indiegogo’s successful campaigns. Despite Kickstarter’s larger scale in terms of the size of the community of backers and the total pledges and dollar amounts raised, their unsuccessful dollar figure of $86 million is very close to Indiegogo’s $71 million.
If you look at it terms of the percentage chance of success, Kickstarter is by far the better choice with its 44 percent success rate. Indiegogo’s success rate is debatable and could be anywhere between 10-30 percent, but it would still be nowhere near Kickstarter’s success rate.
Policies are much more flexible on IndieGoGo
So much for the numbers. Now let’s look at the policies, where Indiegogo admittedly offers more flexible options. One of the reasons that Indiegogo has so many more failed campaigns is because they allow anyone to launch a campaign. Indiegogo places no geographic limitations, and neither do they have any stringent rules or approval process about the type of project.
Needless to say, this attracts a lot of riffraff that mostly end up with failed campaigns that promptly get delisted.
Kickstarter, on the other hand, has a very clear process about who can launch what kind of project. You’ll find it difficult (if not impossible) to get a crowdfunding campaign approved on Kickstarter if you are not in the U.S., U.K. or Canada. Secondly, they don’t approve big-picture ideas or schemes. You can only get approval for building or creating something tangible and specific, such as a video game, movie, hardware device, etc.
The second major difference between Kickstarter and Indiegogo is that you’re in all or nothing on Kickstarter. You set a goal, and you get all the money pledged if you get enough pledges to reach the target amount. If you fail to reach the target, the backers are refunded and you get squat.
Indiegogo does have the same all or nothing system. But they also offer an alternative where you get to keep the pledges as they roll in, so it doesn’t really matter what target you set and whether you reach it.
The downside is that Indiegogo charges a nine percent commission for this kind of flexible campaign that fails to reach its target amount, as opposed to the usual four percent for the all or nothing campaign. Factor in the three percent credit card charge, and it makes for a total of 12 percent commission – just so you can keep the pledges raised even if you don’t hit the target.
Secondly, there’s no motivation for your backers to give more to help you reach the target. This means the amounts pledged and the number of repeat backers will both be lower. It also means that any pledges made are riskier, because the project gets to keep the money pledged even if it is not enough to complete the project.
How about the payment systems?
Another practical difference is that U.S. creators need an Amazon Payments account for Kickstarter, while Indiegogo sends payments to Paypal accounts.
Here’s the bottomline for anyone still wondering which one is better. If you are in the U.S., U.K. or Canada, and your project fulfills Kickstarter’s eligibility requirements, then go for it because the numbers will be in your favor – a bigger community capable of raising more money with a better track record of backing projects to make them successful.
If Kickstarter won’t accept your project and/or if you have doubts about whether you can collect sufficient pledges to reach your target amount, then Indiegogo is a very good second choice. No doubt Indiegogo will object to this conclusion, but hey – you’re not really making it easy by hiding the stats.
Crowdfunding is by nature a platform that calls for a high degree of transparency on the part of anyone who launches a campaign and expects hundreds or thousands of people to hand over their hard-earned money. It’s not unreasonable to expect the same from the platform itself, considering that every project’s future and the careers of the people associated are dependent on it.