We keep hearing that these new business models and platforms really can't handle "big" projects. While part of the charm and power of these platforms is that they can fund smaller "long tail" projects that might never otherwise see the light of day, there's no reason that they can't do bigger projects as well. A few weeks ago, we told you about the Kickstarter campaign for the Pebble e-watch, which was the fastest growing Kickstarter project ever, surpassing $1 million in just 28 hours, and hitting $4.5 million by the time we got our post out.
Last week, the project surpassed $10 million and still had over a week to go. However, the folks behind the project had decided to cap the total number of watches that could be pre-sold via Kickstarter at a mere 85,000. So once that number was hit, they set the Kickstarter to show all the items sold out. While I could see some folks who were waiting towards the end get a little annoyed (thankfully, I got my order in a few days earlier), projects like this should at least open some eyes to the fact that Kickstarter is not just for small stuff. While some have argued that something like Kickstarter could never fund a Martin Scorcese film, remember Kickstarter is just three years old. If Scorcese set up an interesting project with cool tiers, I wouldn't be surprised to see it funded to massive levels.
You may recall a few weeks back, we had a guest post from musician Erin McKeown about her reaction to finding out that a Sony Music artist had copied one of her songs without credit, and the copied song was now becoming a hit. That story kicked off quite a discussion. A few days later, I actually got to meet Erin in person at the Innovate/Activate conference, and we had a really enjoyable chat about the whole thing. So I was interested to see that Erin recently launched a crowdfunding project for her new album on PledgeMusic. PledgeMusic is a platform that's similar to Kickstarter, but focused just on music (obviously). It has some nice features (music player plus the ability to share some of the proceeds with charities) and some oddities (total goal amount isn't clear, and no way to embed anything?!), but if you understand Kickstarter, you'll understand what's going on here.
Of course, tons of musicians (and other creators) have jumped on the crowdfunding bandwagon over the past few years, so just seeing "yet another" project isn't newsworthy by itself. But what struck me about Erin's approach was that some of the tier offerings solidified an idea that had been bouncing around in my head lately about these kinds of projects: the ones that work are somehow uniquely personal to the artist in question. Figuring out what goes into the tiers is always something of a challenge, but I think going with purely generic tiers doesn't do much. I've said before that it's important for artists to understand the kind of relationship they have with their fans and build on that, and it appears that Erin does exactly that with her tier options. Some of them are just amusing, like offering her first Spotify check to a backer, or the anti-SOPA petition video she did during the SOPA fight.
But then there are some that seem like they're totally out of left field... and many of them really show off Erin's personality. Things like having her buy some books for you. Or spending an hour fixing your fantasy baseball game. Or actually going to a baseball game or a museum with her. Or, best of all, getting to play a game of wiffle ball with her and some friends (she seems to like baseball).
Now, again, quirky tier options aren't a new idea. We've been writing about them for years, and I know how some of our usual critics will react: with horror at the idea that Erin has to help people with their fantasy baseball teams to get them to support her music. Hell, we heard exactly that criticism three years ago when we highlighted Josh Freese's hilarious tiers, which included things like playing mini-golf with you, or getting lunch at PF Changs, having him wash your car, or giving you a tour of Disney land. To this day, one of our usual critics still brings up the mini-golf example derisively, arguing that if the new business model means musicians have to play mini-golf with their fans to get their support, the new model is a failure.
But that totally misses the point. No one is arguing that playing mini-golf or wiffle ball with your fans is the future of the music business. We're saying it's all about the kind of person you are and how you connect with your fans. That is, what works has to be something that is unique to the artist's personality, and which fits well with the kinds of things that make fans like that artist in the first place. One assumes that Josh chose minigolf and Erin chose baseball/wiffleball not because it was some horrific thing that they didn't like, but precisely the opposite: because those things are fun to them and they wanted to offer up something fun and unique that they could share with their fans as well. And, in both cases, it seems like they're succeeding.
These kinds of offerings help the artist not just make money, but to better connect with their fans by letting their own unique personality shine through. It's that kind of personality that makes people want to support the artists. It's not because they want to play mini-golf or wiffle ball, but that they like supporting the artist in a manner where the artist gets to have fun as well. And that's pretty cool.
from the what-are-people-complaining-about-again? dept
We've certainly written about Amanda Palmer's many success stories on this site before -- including her celebration of the fact that she finally got dropped from a record label two years ago. Since then, she's done a bunch of fun projects, more or less going musically wherever she suddenly felt like going (all without the meddlesome hand of a record label demanding she do things its way). These experiments have been quite successful, and also quite lucrative. But she decided it was time to do a "traditional" studio album again, and put together a full orchestra to help, while also planning to make the physical package she sells totally and completely worth buying by including all sorts of original artwork with it.
So... of course, she turned to Kickstarter to help put together funds, seeking $100,000 in 32 days. Instead, she got it in SIX HOURS. Damn. As we've noted, the success of Kickstarter as a funding platform is making it easier and easier to fund big projects, and this is yet another example of that. If you have a semi-decent following, you might question why you'd ever sell your soul to a large company for an "advance" again.
The details of what she's offering are, as you might expect, quite interesting as well. All too often, it feels like people seem to think that all you have to do is "put it on Kickstarter." And, sometimes that can work, but it helps to have cool options. Amanda's offering has a lot of cool goodies and opportunities (including live events) for backers, allowing them to self-select in to how they'd like to support her. A lot of the offering is vinyl focused, which isn't that surprising, given the renewed popularity of vinyl these days, but also the ability to do more artistic work in combination with a vinyl release. Of course, not everyone has a record player... but they've got that covered. At some of the higher level packages, they'll include a USB-enabled Crosley turntable which they'll custom-paint for you, making it awesome.
Also, with this project, Amanda announced a new project called Loanspark, which is kind of like a Kickstarter, but as a loan, where the money gets paid back (assuming it's made up) and the "interest" isn't monetary, but creative. This is definitely for larger amounts, but you can see the listing of options, which include things like getting a home concert (or for a charity) or a work of art created by Amanda. Who knows if anyone will take her up on it, but it's another interesting idea worth watching.
Once again, it seems that lots of artists are figuring out cool and creative ways to make money these days, even as the old industry continues whining. Of course, what's notable is that these new ways don't seem to involve those old industry players -- or their ridiculous deals where they get the copyright and keep the vast majority of income.
For years, we've been hearing how the new business models we talk about aren't really "big enough" or that they're just "exceptions" to the rule. Yet, every year we see more and more success stories involving those kinds of business models. Kickstarter, for example, has been quite successful building a platform that empowers exactly the kinds of business models we've described for nearly a decade -- and it has found tremendous success doing so. It just posted some stats for 2011, showing that just under $100 million was pledged into projects this year (with approximately $84 million going into projects that were actually funded).
Perhaps most interesting of all? The two areas of the entertainment industry where we repeatedly hear the loudest cries of "there are no new business models!" -- movies and music -- were the two largest areas on Kickstarter. An impressive $32,473,790.40 was pledged for films and video -- leading to 3,284 successful projects, involving 308,541 backers. For music, it was $19,801,685.21 pledged for 3,653 successful projects, involving 260,178 backers. The 2011 numbers roughly tripled the 2010 numbers, so this kind of thing is clearly growing quickly. And, remember, Kickstarter is just one company in this space, which has multiple other companies -- such as IndieGogo and PledgeMusic -- offering similar platforms.
And yet, we're told that there's no way to make money and that fans just want stuff for free? Perhaps it's time to rethink some of those assumptions...
But the really key thing here is exactly what we've said all along: new business models develop. They always do. And part of allowing those new business models to develop is letting new startups, services, platforms and tools develop to meet the needs of the market. Kickstarter clearly meets a need. Things like SOPA and PIPA make it more difficult to start such a company or build such a platform these days (which is why both Kickstarter and IndieGogo have come out strongly against these bills). Let these new services live, and watch new business models succeed (and with them, all sorts of artists and creators).
In his case study, Kevin discusses how they raised funds to produce the piece via Kickstarter. But what struck me as interesting is that Kevin notes that, in the end, he did have to pay some out-of-pocket money to get the video made, but he still considers the entire experience to be a success. Why? Because of a large number of non-monetary benefits that came out of it, which are already opening up new opportunities and which will make it much easier to succeed in the future as well:
Why is it a success story?
Because a ton of good things came out of it. New connections with talented artists, a film to highlight my work and the violinist's, new audiences for the work (the staff at Noteflight for a start) and a list of 34 people who've already given money to support my work (including a fair number of complete strangers). It's also given my closest friends and family a taste of what it's like to write checks to make these things happen - that will make it easier the next time around when I'm looking for more money. That's really valuable.
Also, because I successfully managed a kickstarter project I've become a kind of resource to other artists who are thinking about doing similar things. This hasn't led to any revenue yet, but it has led to some great conversations, helping on awesome projects, and again, more connections and potential audience and supporters for my next project.
I think this is an interesting point that often gets lost in these discussions. Not every specific project needs to be directly "profitable." Many work as a way to build the framework for future successes. Hell, that's the very basis for marketing. You spend money in the hopes that down the road it pays off. Marketing is always an expense, but in the long run, you hope that it's indirectly profitable. Those who seem to insist that every project must be directly profitable are missing out on a ton of opportunities to lay the groundwork for profitability down the road.
As we do with our posts about case studies on Step2, we're turning off the comments here, but urge you to head on over to Step2 to take part in the discussion there.
Occasional Techdirt poster, filmmaker, comic artist and copyright critic Nina Paley recently put up her first Kickstarter campaign, seeking to raise $3,000 to produce a large print run of some "minibooks" of her series of comics about "Intellectual Pooperty." The idea is to put together these small books that can also be carried around and passed around. At $3,000, she could do a large enough print run to keep the prices down (print-on-demand is much more expensive). It took all of two days to reach $3,000 and the number keeps going up (full disclaimer: I kicked in $25 in order to get five of these books, so I can hand them out to folks when necessary). If you're unfamiliar with her work (and you shouldn't be if you read this site), here's a sampling of strips that we had posted last year:
An anonymous reader pointed us to an interesting look at how crowdfunding is becoming more popular for movies. Make no mistake: it's still not widespread by any stretch of the imagination. But there are a growing number of examples of it working. In the link above, the author, Peter Broderick, points to a couple of movies that were funded this way, noting that they had existing fanbases, as they were based on books that already had a committed following. However, he focuses the main part of the discussion on a movie that came with no such built-in fanbase: I Am I, which was able to raise $111,965 via Kickstarter starting from scratch with just a few friends. The filmmakers smartly had also found an outside investor who was willing to match any such funds up to $100,000, so they came out of this with over $200,000 in funding. They sent out emails to friends and pushed the project on Twitter, and it began to get some attention.
Donations started strong ($17,000 in the first few days), slowed down over the Christmas holidays, and accelerated as they approached the finish line ($24,000 in the closing days). Their contributors included friends, family, colleagues, and a few studio executives. 80% of their 902 contributors were total strangers. Amazingly, 3 of these strangers made $10,000 donations, for which Jocelyn and Simon promised to come to their hometowns and do private screenings just for them. Overall, as is typical with Kickstarter projects, the majority of donations were at the $20 (32%) and $100 (26%) levels.
Their campaign was so successful that it gave I AM I the momentum needed to move into production. Even after their campaign ended, people were still asking to contribute. The I AM I team added a Donate button to their website and is offering rewards similar to those they gave on Kickstarter.
So how did they achieve this? Well, certainly a well-designed website, and a really entertaining video (embedded below) for the project helped, and got some viral buzz going. And, from that, word of mouth really seemed to take off.
The other interesting point is that the community that's been built up around the crowdfunding are providing much more than just money. There are now about a thousand people who have a really big interest in helping the movie along and promoting it to others:
In addition to the $111,965 raised, their campaign created a large network of supporters. Producer Cora Olson observed, "our initial goal was to raise as much money as possible, but when we saw how many online impressions we were making, we realized that this awareness could ultimately be more valuable than cash when itís time to launch the film."
I still think it's early for such crowdfunding projects, and the failures don't get nearly as much attention as the successes -- which is a bit unfortunate, as there's much to be learned from what went wrong as well. However, I still think it's a fascinating area to study and to understand, and I'm glad that we're getting more and more case studies to learn from out of what's going on these days.
Last week, we kicked off our new "case study" series, with a post about musician Jason Parker's experiments with "pay what you want" for his music. This week, we're going in a different direction, as will be explained in a bit. We've received a bunch of suggestions for future case studies, with plenty of good ones, but if you know any content creator experimenting with interesting business models, who you think would make a good case study, please let us know via the "contact us" link at the top of the page.
For this case study, we're actually going to discuss an experiment by someone that regular Techdirt readers may know quite a bit -- especially if you spend a lot of time in our comments. It's Tim Geigner, whose name may not be that familiar to you, but his alter ego Dark Helmet has been one of, if not the most prolific commenters on Techdirt, where he tends to play the role of comment enforcer, keeping people (including me at times) in line, when he feels anyone has spoken without thinking. Separate from that, however, he's been writing a fair amount of fiction lately, which is quite enjoyable.
For one of his fiction books, Midwasteland, he decided to test out Kickstarter, a platform for "crowdfunding," creative works, which has received a lot of attention. His Midwasteland project is still in process, so if you like his work, feel free to jump in and support him. That said, he's not sure that he used Kickstarter all that well, and isn't sure that his project will reach the necessary goal to get funded. I think there's often a lot more that can be learned from what ideas didn't work, than what did, so I talked with Tim about why he thinks things didn't go as ideally as possible. First, however, he pointed out that even if the project doesn't get funded, a few really good things have happened, which we'll get to below. But, he's taken away some important lessons on why Kickstarter hasn't been quite a magic bullet:
Why didn't it go as I'd initially hoped? The onus is all on me. That's the other cool part of this: I'm learning lessons that I can use on my next project, whatever it may be.
Lesson 1: It isn't enough to have a good idea, you have to do your due prep work to make it successful. My audience right now isn't huge. It might not even be big. I knew that going in. What I know now is that I should have worked my tail off in getting this idea out there enough so that when I did release the project live, it would already have a presence. This go around I tried to do it the opposite way: release the project and hope it builds the bigger audience. That hasn't worked.
Lesson 2: It isn't enough to have people be genuinely interested in you, you need them to want to PROMOTE you. I had an experience when I came across Autotune the News on Techdirt, where I was sending their links to everyone I knew and sitting people down when I had a chance and showing them their videos on my phone or iPad. My project never really reached that level. And I know why. Because I didn't connect with interested parties properly coupled with a lack of an appetizer. Looking back, it was immensely dumb not to have a way for people who got involved with the project to have the first chapter or so of the book to read and pass around. What did I expect, that they would want to link to my project on their websites or in emails to friends? New business model experiments might interest some, but the writing was supposed to be front and center. I didn't do a good job of that. I didn't get the infinite good to promote what I was "selling".
Lesson 3:There is more to value in a project like this than making money. I got a TON of feedback on my writing. I learned a TON of little lessons from trying this project. Here's that absolutely awesome part of all this: what have I lost? The simple answer is nothing. I don't lose my ability to release the book elsewhere. I don't think I'm going to lose any fans from the people that chose to back the project, since I'm going to be sending them a free copy of the eBook anyway. I don't lose the opportunity to do what I wanted to do for the project, since I'm going to do it anyway (making a DVD of the settings in the book seems like entirely too much fun not to do, after all, and maybe somebody someday might want it!). Meanwhile, I've gained so much in terms of lessons, feedback, interest from an agency and film company, etc. This was a good thing. That it didn't go as I'd planned means that I have to do something different. I believe in the work, I believe in my fans and potential fans. That means if I tweak some things, it'll go better next time.
That last little bit is one of the other positive, but unexpected things that came out of this: he was contacted by both a book agent and a film company due to the Kickstarter project, so even if that doesn't succeed in getting the funding set, it has opened some other potentially interesting doors as well.
Tim's lessons are really useful ones. We've tried to make the point in the past that while we love to point out new and unique business models, the business model alone is not everything. It's a combination of factors. The content you're creating has to be good. You have to work hard to build true fans who really believe in what you do (and, as Tim notes, get them to want to promote your work) and that involves really connecting with them. The whole Connect with Fans + Reason to Buy (CwF+RtB) thing may sound flip and simple, but you really do need both components working together, so that they build off of each other. And, on top of all of that you do need a little bit of luck. But that's also why I talk about the importance of improvisational business modeling. If your first attempts don't work, that doesn't mean give up -- it means, learn, adjust and try again.