It turns out that I have written an essay (September 2012) about crowdfunding and possible use of this new form of financing in publishing by authors and forgot to share it here at Blankchapters.
In the essay, I talk about the most used self-publishing models, as well as explanation of what crowdfunding is and how it can be used by authors to get their works out there.
Along with that, I used data, scraped from Kickstarter, to analyze several key variables in a crowdfunding campaign and how they differ along the project status – success, fail, canceled:
- Goal – the amount of money that project needs to raise
- Duration of project – number of days the project is accepting funding.
- Backers – number of funders for the project.
- Reward Levels- number of reward tiers offered to backers.
- Updates – number of updates, founders have posted about the project, during the fundraising period.
- Comments – number of comments posted (from funders and backers) about the project.
The data was shared by Jeanne Pi for free distribution and encompasses 24,503 successful projects, 26,483 failed projects, 4,073 ongoing projects, and just over 100 canceled projects. In a blog post Jeanne Pi mentions that when scraping the data, her team discovered that they have 94% of successful projects,and 80% of failed projects.
For the essay I used only projects from the Publishing category, encompassing 4760 projects. 560 of them were still listed in the data file as “ongoing”, thus I had to scrape Kickstarter to establish their status and additional data after completion.
I cleaned the data further, eliminating extreme goal values (16 project below $100 and one project above $500 000). After that, the results showed 4743 project, representing combined $34 997 648 of goals, $12 121 443 of pledges and of which 1822 projects (38%) from the Publishing category were successful.
When it comes to campaign duration, prof. Mollick of the Wharton School of the University of Pennsylvania found that shorter campaigns have bigger chance of success, but just slightly. For the Publishing category, the same is valid:
Another important part of a crowdfunding campaign is the reward levels (according to amount pledged), that every creator sets. Many crowdfunding experts say that it is better to set several different reward levels and give a choice to possible backers – more backers, pledging smaller amounts of money is not a hindrance to the success of the project. Especially if those backers share the project with the respective social networks and achieve a network effect for funding.
For the publishing category and its subcategories, generally project creators set up 8-10 reward levels, even though some projects have over 30, but they are more outliers than the regular reward levels rule of thumb number.
Comments and Updates
Comments are a great measurement for audience engagement throughout the whole campaign. It could function as a place for backers to learn even more about the project, to ask questions and keep informed about the product process as well. One of the most important features of the comments is the ability to connect with other backers and create a community around the project from the initial steps of the campaign.
Data show as well that most successful project have more updates and comments on average – with fiction and children’s books categories having the most – between 7-10 updates and 5-7 comments.
Of course, quality of the project will always be one of most important determinants for a crowdfunding success – if the project has quality video and description of the project, maybe even sample writing, all could give the project all that is needed for success.
The analysis provides a glimpse at the current state of crowdfunding books – a trend, I hope, to continue more successfully with the establishment of niche crowdfunding platforms, that specialize in book publishing, scientific publishing, etc.
To see the whole essay please click here