Amanda Palmer Details How All That Kickstarter Money Is Being Spent

from the being-open-and-awesome dept

Back at Midem, I did a presentation talking about the importance of being more open, human and awesome is a key component to standing out against the (growing) competition these days. I used the example of Louis CK, but Amanda Palmer would be just as good. After all, her Kickstarter campaign is getting tons of attention for raising a ton of money, leading many to wonder how she did it.

But as the numbers keep going up, it's also raised a second question: where is all of that money going? And so it should come as little surprise that Palmer has opened up and explained in fairly great detail where the money is going, and highlighting that even if the campaign ends up at a million dollars (a real possibility), a very large percentage of that money is actually going back into the "product" being offered. Here's just a snippet, but you should read the whole thing:
7,000+ high-end CD-books & thank you cards cost about $15 a package to manufacture and ship. that’s $105,000.

1,500+ vinyls & cards, at about $20 to manufacture & ship…about $30,000

2,000+ art books (bearing in mind the shipping on those, every time they need to be shipped from the plant, to the distributor, to YOU, plus the signing, is killer) will cost us roughly $80,000.

PLUS we have to factor in about $15-20k to pay our design team to actually design all this stuff, and to make it super-duper amazing and worth your money. those of you who supported mine and Neil’s last Kickstarter know what i’m talking about here. this CD is gonna be a super-deluxxxxxe work of art.

the neil and kyle books are going to cost us a LOT of dough to create…let’s just throw out about $100/copy for about 100 copies…that’s 10k.

if we sell about 100 turntable packages: ordering the tables, paying the artists to paint them, shipping all that stuff around: ballpark another $15k.

arts & crafts/7-inch packages, if we sell about 300 of them, adds about another $30k (we’re planning on spending roughly $100 each on the packaging for those, including not only the vinyl but the fun arts-and-crafts activities. oh, and postage/shipping x5)
There's a lot more, but it adds up. In the end, she basically notes that the purpose of Kickstarter alone isn't to make a profit, but to invest in all of this awesomeness such that it can help sustain things going forward:
ONE…we are committed to doing amazing things for all of you who pledged. sure, it’s going to cost more to make things extra fancy (and for us to ship things for FREE all over the world), but making this stuff amazing IS THE POINT. if i skimped on making the packaging and actual products INCREDIBLE, i’d be an idiot.

and

TWO...a LOT of our income for the next year WON’T COME from this kickstarter. it’ll come gradually, over the following year: from the touring show, from the merchandise we sell on the road, from money we get in donations when i make the tracks available online, from the money i get from iTunes from the people who are sometimes lazy (like me), and so forth. it’ll be a slow burn, like it always is.
Some might think it's incredible that she could "make" a million dollars, and not come out super wealthy out of that process, but as she noted: "that’s FINE with me. it’s almost even THE PLAN." Why? Because it helps set up a variety of things for the future. This is important. As much as we've praised Kickstarter, which is completely awesome, it's not a business model by itself. It can be a piece of a business model, but it's an "event" and a limited time thing, rather than a sustainable ongoing revenue stream. Amanda is using Kickstarter wisely (obviously) not to just raise a ton of money and throw it all away (like a major label advance), but as a way to invest smartly in an awesome product while also setting up a way to keep earning money in the future.

And she's doing all of this in a characteristically open and human way.

As we said, being open, human and awesome is a key way to succeed these days, and Amanda's doing it better than just about anyone else out there.

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  1. identicon
    Michael, 23 May 2012 @ 11:34am

    Re: Re: Re: Re: Re: Re:

    "No, I don't have a personal stake. i just found it odd that you sounded like you were dismissing her and her project without having listened to her music once, and writing it all off as 'fancy packaging'. Which you did."

    I made a simple statement, that the music is ultimately what's important. Good packaging, while a nifty bonus, cannot compensate for a lack of musical ability. I didn't say one way or another whether her music in particular is any good.

    "But that isn't the point you were making, the point you seemed to be making was a dismissive one. As I've repeated already. Regarding fancy packaging."

    You can take it however you want. It's just a general statement, not a personal critique.

    "You seem to be drawing that point, the one you just stated, based on how much she received. Others might realize that she got all that money from fans and non-fans because of all the extras she was offering and because of the fact that they wanted to donate to her. Nearly a million when all she needed was $250,000 DOES NOT lend credence to any of what you said beyond the fact that people will give to those they feel are worth of giving to and to causes they believe in. Nothing more, nothing less. In fact, if anything the fact that she received nearly a million when all she needed was $250,000 says that you can make music of high-quality at a substantially lower amount than big labels would have you believe. That figure she wanted is proof of that. That she made more appears to be because people genuinely support her and what she's doing."

    So be it.

    "I know! That's why I find it odd you're focusing on the 'fancy packaging' and talking about 'substandard' music. I agree, the music is what it is. In this case nothing changes about that. What I pointed out is that she's giving tons of extras along with her music. Which you seem to have a problem with."

    That's not my issue. I'm saying that no matter how it is that's involved, you cannot obfuscate bad music with great packaging/extras. So, if the music is of high quality on her album and people enjoy it, all well and good. But if not...

    "Those are wasted expenses IN YOUR EYES. In the eyes of those donated they are not. Obviously. Because if they were they wouldn't have donated so much."

    That's correct, in my opinion it's not worth the added expenses, but many feel otherwise. But then, many people also support Lady Gaga, Justin Bieber, etc.

    "I mean geez! You want her to produce music and music only. No packaging for it, no art books, no personal thank you cards, no private concerts, etc. Which is what all that extra money is going to. It's going to all that extra stuff. So it's not 'wasted expenses'. She got what she needed for JUST the music and then some for all the extras."

    Not that it matters but I'm not wholly convinced of that.

    "Which for some reason you can't comprehend and don't accept. Which brings me back to my point of you obviously have a personal problem with her and are trying to discredit her by saying she's wasting money and packaging substandard music with fancy extras. Or am I wrong? If I'm wrong say so, but that's how you're coming off."

    I'm not against artists using Kickstarter and other crowd-funding in order to get projects rolling. But something about a millionaire asking fans to fund a vanity project rubs me the wrong way.

    "Why do I care? I don't particularly. I just don't like people dismissing or discrediting others when they haven't heard them or experienced them in some way, shape or form. Which is what you're doing. "SHE MADE $1 MILLION! HOW DARE SHE! SHE ONLY NEEDS THIS MUCH TO MAKE A GOOD ALBUM! SO OBVIOUSLY IT SUCKS AND SHE'S TRYING TO HIDE THAT FACT BY PACKAGING IT NICELY!" That's how you sound and have been sounding. Is that what you mean to sound like, probably not. But it is how one can interpret your comments so far to be."

    That's your observation of my previous posts. Oh well.

    "As I said, you could've easily stated your opinion and put it in a way that leads no room for people to misinterpret. You didn't. You can make things abundantly clear now or you can keep focusing on packaging. Choice is yours."

    I believe that I have the right to express my opinions on subject matter covered here, which I did. For whatever reason, you blew it way out of proportion.

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