A couple of weeks ago, Mindee Forman highlighted some key findings from Ethan Mollick's research on crowdfunding. I'm seeing more and more papers crop up on this topic, including what I will be highlighting today, "Crowdfunding Creative Ideas: The Dynamics of Project Backers in Kickstarter," a working paper from Venkat Kuppuswamy and Barry L. Bayus (available here). The paper is interesting throughout and has some factoids about Kickstarter projects that I will not call attention to here.
This paper corroborates many of the findings that Mindee wrote about--that being featured on Kickstarter, having a video, and having a shorter project duration increases the chances of having a successful fund raise. While this may seem redudant, it's important in terms of research for different analysis to draw the same conclusions. We also learn some new information from Kuppuswamy and Bayus about attracting backers:
- Smaller goals are more successful at being funded.
- Many reward categories increases the chances for being funded.
- A project with a colon in the title is correlated with successful projects [amusing, I wish they spent more time theorizing on this one].
- Prior Kickstarter experience helps a little.
They also investigate donations along the funding cycle. They find that after initial backers sign on, an average project experiences a lull in attracting new backers, but makes a comeback once the deadline nears.
The authors interpret this in terms of the buzz or excitement a project intially generates, followed by a decrease in interest, followed by a pickup when the deadline approaches. Alternatively, to me this sounds like it could be a good samaritan dilemma--I see that someone else is already helping, so I don't need to contribute here; oh wait, this is more urgent than I thought, I should help!
In any event, Kuppuswamy and Bayus find that posting private and public updates as the funding deadline approaches helps quite a bit, which is significant because this is something under the project creator's control.