Kickstarter Alternatives: 9 Sites Like Kickstarter For Business Funding
Chances are, if you’ve looked into crowdfunding as a possible source of capital for your business, you’ve considered Kickstarter. And why not? Kickstarter has come to dominate the conversation when it comes to tapping the internet for funding creative projects, and it’s not hard to see why. At latest count, Kickstarter has seen over $3.5 billion pledged to projects on their site, over 14 million total backers, and over 139 thousand successfully funded projects. (And these numbers are likely to have been surpassed by the time you read this.)
When you stop to consider some of the head-scratcher projects that have succeeded on Kickstarter (and been subsequently ridiculed on social media) — the Pause Pod indoor personal tent and the RompHim come to mind — you might be tempted to think that just about any goofy-ass project can achieve funding success with Kickstarter. However, this just isn’t so. First of all, Kickstarter is selective. You can’t just sign up for an account and start fundraising. Unlike most of the competition, Kickstarter pre-screens all potential projects before giving them the go-ahead (or not). Another thing to consider: Kickstarter mandates that all projects raising money on its site “must create something to share with others.” If your business venture isn’t involved in producing a tangible item, you’ll have to look elsewhere for a crowdfunding platform.
Another Kickstarter trend to bear in mind is that it is becoming a platform where projects backed by investors and crowdfunding agencies have a distinct advantage in vying for the public’s money. A HuffPost article by Nathan Resnick titled “Why Kickstarter Is Corrupted” details some of the concerns long-time users have had with the platform over the years, including the rise of paid advertising and investor-backed campaigns. In short, it’s getting tougher for the little guy to get a Kickstarter project funded as moneyed interests tilt the playing field.
One last limiting factor with Kickstarter that I’ll mention is that one can launch a campaign only from the U.S., Canada, Mexico, most of Western Europe, Hong Kong, Australia, New Zealand, and Singapore. This leaves out some rather large portions of the world.
As it turns out, entrepreneurs, startups, and businessfolk have many alternatives to Kickstarter when it comes to dragging the cyber-lake for dead presidents, so to speak. In the interest of giving you a fuller picture of the crowdfunding industry, I’m highlighting nine sites like Kickstarter for all you budding innovators out there.
Table of Contents
- Rewards and equity crowdfunding
- Keep-what-you-raise AND all-or-nothing funding available
- Best for filmmakers, techies, and game makers
Launched in 2008 at the Sundance Film Festival, Indiegogo (see our review) was initially conceived as a way to crowdfund independent film projects. Soon thereafter, Indiegogo changed its mission to encompass a broad array of both business and charitable campaigns. Unlike Kickstarter, Indiegogo is a truly global crowdfunding platform; you can launch a crowdfunding campaign from pretty much any country on the planet.
I should note that along with Indiegogo’s standard crowdfunding platform, it offers an equity crowdfunding platform (through a partnership with MicroVentures) called First Democracy VC. These equity crowdfunding campaigns must be U.S.-based and face a fairly stringent approval process before they can go live. I’m focusing more on Indiegogo’s standard crowdfunding site here.
Indiegogo shares a lot in common with Kickstarter. Both platforms have become a haven for fundraising campaigns relating to tech/gadgets and creative works like board games, art, music, and cinema. Both platforms facilitate gift-giving between campaigners and backers so as to motivate potential backers to get involved. Lastly, both platforms take roughly the same cut of what the entrepreneur/creator raises. For a U.S.-based creator, both platforms take 5% off the top, while the payment processor takes an additional 3% + $0.30 per pledge with Indiegogo. With a Kickstarter campaign, the payment processor takes 3% + $0.20 per pledge. Not much of a difference.
However, the two platforms differ in some important respects as well, starting with the fact that while Kickstarter only lets you keep the money you raise if you meet your funding goal, Indiegogo lets you choose between launching an all-or-nothing campaign a la Kickstarter or a keep-whatever-you-raise campaign. While there are merits to either crowdfunding approach, it’s nice that Indiegogo gives you the flexibility to decide which method is right for your project.
A second difference between the two platforms is that while Kickstarter requires that you offer physical rewards to your backers in exchange for their support, Indiegogo does not. Now, Indiegogo permits you to offer rewards in exchange for backers’ support — in fact, it recommends it, noting that campaigns offering “perks” raise 143% more money than those that don’t — but it leaves that decision up to you.
Another point of departure from Kickstarter is that Indiegogo does not pre-screen projects before letting them onto the platform the way Kickstarter does. Indiegogo presents itself as a more freewheeling platform than Kickstarter with fewer chokepoints and barriers to entry, and this policy is in keeping with this ethos. As crowdfunding was originally intended to benefit the little guy/gal (not outfits supported by outside investors and agencies), I tip my cap to Indiegogo for this.
Indiegogo is a fine alternative to Kickstarter if you’re looking to get your business venture funded. In fact, I found a number of comments online from people who had been rejected by Kickstarter and subsequently took their campaign to Indiegogo and found fundraising success. Indiegogo’s customer service is generally regarded as being superior to that of Kickstarter as well.
Read my Indiegogo review if you’re curious about learning more.
- Continuous rewards crowdfunding
- Collect funds on a monthly basis
- Best for podcasters, YouTubers, musicians, and other artists
Launched in 2013 and a relative newcomer on the crowdfunding scene, Patreon (see our review) has quickly generated a great deal of buzz. Creators and entertainers of all varieties have found Patreon’s particular crowdfunding model to be a good fit. As of late February 2018, Patreon campaigns are cumulatively collecting over $11 million per month via the platform.
Patreon is a better choice than Kickstarter if you’re in the business of creating things on a regular basis. In 2013, shortly after Patreon’s launch, founder Jack Conte described the platform like so:
I’m releasing new things on a monthly basis. I have friends releasing material weekly,” Conte said. “They’d have to almost invent an excuse to raise money after going on Kickstarter once. We’re saying, ‘No, no. Don’t make up a new endeavor. Keep doing what you do best and let people pay you each time you do that.
With Patreon, backers don’t just support you with a one-time payment. They sign up to support you on a recurring basis, either per month or per creation, with the expectation that you will release content continuously. This makes Patreon an ideal platform for artists, musicians, and podcasters who seek to monetize their audience. What better way to make money off what you do than to get support from the very people who seek out your content?
Unlike Kickstarter, Patreon doesn’t actually require you to provide exclusive content to your backers (or “patrons,” as Patreon refers to them), though Patreon highly recommends it. It’s hard enough to get people to financially commit to you on a recurring basis — it’s all the more difficult if you’re not offering anything in return!
Patreon is a more flexible platform than Kickstarter when it comes to content that many would consider controversial. In fact, Patreon explicitly allows “adult content,” setting it apart from most other crowdfunding sites. If your content verges on NSFW territory, Patreon is a better fit for you than Kickstarter — though the free content on your Patreon page must be “appropriate for all audiences.”
Read my Patreon review to get the full story on why this recurring crowdfunder is trending.
- Rewards and equity crowdfunding
- All-or-nothing funding
- Best for makers of consumer products with high growth potential
Fundable (see our review) is a more button-down crowdfunding platform than Patreon and its funding model is more akin to that of Kickstarter. However, Fundable differs from Kickstarter in a few key ways, as I’ll explain.
Founded by Wil Schroter and Eric Corl in 2012 and launched in Ohio, Fundable is strictly for businesses looking to raise capital. As of this writing, Fundable has facilitated $411 million in funding for its campaigners. That’s a bit more than a tenth of the amount raised on Kickstarter. Indeed, Fundable isn’t as popular a service as Kickstarter, but let’s explore whether the platform may nonetheless work for you.
Unlike Kickstarter, Fundable doesn’t take a 5% cut of what you raise. Instead, it charges a flat fee of $179 per month to use their platform. This can be a daunting prospect, considering the fact that many crowdfunding campaigns fail. However, if you have a successful campaign that sees you raise tens of thousands of dollars (or more), you may end up saving a lot of money this way compared to Kickstarter. To illustrate this: 5 percent of $100,000 is $5,000 — that’s a lot more than a few monthly payments of $179!
Before you get too excited, keep in mind that the payment processor will still take 3.5% + 30¢ per transaction in a Fundable rewards campaign. (Equity campaigns operate under different rules.)
Like Kickstarter, Fundable requires pre-approval before your business can launch a campaign. Fundable also follows the Kickstarter all-or-nothing funding model — if your campaign doesn’t meet its funding goal, you get nothing, and you still have to pay the monthly fees to use the platform. Ouch!
However, there’s one major point of departure vis-à-vis Kickstarter: Along with rewards-based funding campaigns, Fundable lets you launch equity-based campaigns in which investors send you funds in exchange for an ownership stake in your company. This is a more difficult prospect than rewards crowdfunding — only accredited investors can contribute — but for entrepreneurs and businessfolk prepared to deal with the complexities of equity crowdfunding, it’s an option Fundable provides. In fact, for around $2,500, Fundable offers a premium service in which they put you in touch with accredited investors.
I should mention that unlike the crowdfunding sites I’ve mentioned thus far, Fundable is strictly for U.S.-registered businesses.
Podcasters and YouTube stars won’t find Fundable to their liking, but for the right kind of business, Fundable can help raise some serious moolah. Check out my review of Fundable to learn more.
- Rewards and charitable crowdfunding
- Keep-what-you-raise funding
- Mainly for personal causes; can be used to fund socially-conscious business projects
GoFundMe (see our review) was founded in 2010 in San Diego. It has since grown to become a crowdfunding behemoth and is the only crowdfunding platform that has raised more money than Kickstarter (over 5 billion and counting).
You might be wondering why I’m including GoFundMe on my list, considering the fact that it is a platform known for charitable crowdfunding campaigns, not business fundraising. It’s true that if you’re launching a business-related project that has no larger purpose or social message, it’s probably not going to gain traction on GoFundMe. However, if your project concerns a business venture but can be framed in an uplifting way, or if it has some kind of social justice message that can be emphasized, you could indeed conduct a successful business crowdfunding campaign on GoFundMe. Here are a few examples:
- Fifty3 Motorcycles: Crowdfunding startup costs for a veteran-owned and operated business.
- Cassava: Raising funds to keep a community restaurant open.
- The Waffle Cookie: Raising startup costs for a business that supports a non-profit.
A GoFundMe crowdfunding campaign does bear some similarities to a Kickstarter campaign. GoFundMe gives you the tools and the bandwidth to launch a crowdfunding campaign and take it viral with social media connectivity. You can also offer rewards to your contributors, though unlike Kickstarter, rewards are not mandatory.
The differences with Kickstarter, however, probably merit more attention than the similarities. GoFundMe does not charge a platform fee to campaigns started in US, Canadian, and UK currency. For small-time campaigns especially, this lack of a 5% platform fee can make a big difference. Bear in mind, however, that you’ll still be paying 3% – 5% of what you raise in payment processing fees, and that in Australia and continental Europe the 5% platform fee stands.
One unfortunate aspect of GoFundMe is the fact that you have to connect your campaign to your Facebook page in order for your campaign to be publicly listed on GoFundMe’s site. As it’s awfully hard for a campaign to gain traction if it doesn’t appear in the directory, GoFundMe essentially forces you to use Facebook if you want your campaign to be successful. I steer clear of Facebook myself, so I have to give a big jeer to this policy.
Read my GoFundMe review to get the whole picture.
- Donation-based crowdfunding for charities, non-profits, and businesses
- Keep-what-you-raise funding
- Best for nonprofits and cause-oriented businesses
Razoo hosts crowdfunding campaigns for both business and charitable purposes, but unlike Kickstarter, they don’t charge a platform fee to their personal campaigns (though 2.9% + $0.30 per pledge will go to the payment processor). Also unlike Kickstarter, Razoo doesn’t set a time limit on the duration of your funding campaign.
Unusually for a crowdfunding site, Razoo doesn’t allow you to offer rewards to the people who support you. For that reason, Razoo wouldn’t be my first choice of a crowdfunding platform for a business project. However, Razoo is still an option — one that has facilitated many successful crowdfunding campaigns.
One advantage Razoo offers over Kickstarter is a more comprehensive customer support system. Razoo offers both phone support and email support. (Kickstarter only offers email support.) Other features unique to Razoo include a Facebook donation widget and the ability to donate to campaigns using PayPal. Furthermore, when you set up a crowdfunding campaign on Razoo, you can launch it immediately without waiting for approval.
Interested? Here’s my full Razoo review.
- Equity crowdfunding for accredited investors
- Keep-what-you-raise funding
- Best for early-to-mid-stage startups with exponential growth potential
Crowdfunder (see our review) is a different breed of crowdfunding site compared to Kickstarter and the other crowdfunding sites I’ve discussed. Crowdfunder is strictly an equity crowdfunding platform. In other words, instead of offering people rewards in exchange for their financial backing, you offer equity — an ownership stake in the company. Equity crowdfunding is more complex than rewards crowdfunding as investment is much more heavily regulated than Kickstarter-style crowdfunding. Check out my article on equity crowdfunding to learn more.
Crowdfunder’s brand of crowdfunding is for a very specific slice of the market. In its own words:
Crowdfunder is designed for early-stage startups and more mature businesses raising seed stage, Series-A & Series-B funding. Our offering does not cater to inception stage companies at this time.
Crowdfunder lists the following stats concerning the company on its About page:
- $160,000,000 investment commitments on the platform
- 12,000 individual & institutional investors
- 36,000 companies
- Funded 100+ deals at an average deal size of $1.8M
Crowdfunder doesn’t take a cut of what you raise. Instead, they charge you a monthly fee for use of the platform. The platform has three subscription packages available — the cheapest of which costs $449 a month. Compare this with Fundable’s $179/month and it becomes apparent that Crowdfunder isn’t concerned about barriers to entry.
On the other hand, Crowdfunder lets you keep whatever funds you raise regardless of whether you hit your funding goal or not.
Read my Crowdfunder review if you think your business could take advantage of their offerings.
- Equity crowdfunding for accredited AND non-accredited investors
- All-or-nothing funding
- Best for unique startups with exponential growth potential
Wefunder (see our review) is an equity crowdfunding platform like Crowdfunder. What sets Wefunder apart from Crowdfunder and many other equity crowdfunding sites, however, is the fact that Wefunder lets businesses raise money from anybody who wants to invest, not just accredited investors. And when it comes to equity crowdfunding for non-accredited investors — sometimes referred to as Regulation Crowdfunding — Wefunder is the market leader. In fact, they currently hold 50% of the market share in Regulation Crowdfunding. In a young industry that’s still finding its sea legs, Wefunder has a track record of success.
According to Wefunder, the company has seen 176 startups achieve funding success, with a total of $55,644,183 having been raised as of late February 2018.
You can set up a Wefunder profile for your company for free. However, when you want to actually launch a campaign, there’s a one-time $195 fee, and if you meet your funding goal by the end of your campaign (Wefunder’s funding model is all-or-nothing), Wefunder will take 7% of what you raise. You won’t have to pay payment processing fees on top of that — those are borne by the investor.
Wefunder doesn’t curate the companies on its platform the way many equity crowdfunders do. You’ll be allowed onto the platform so long as you don’t violate the rules. You can raise anywhere from $20,000 to $1,070,000, and individual investors can invest as little as $100 in your company.
Read our Wefunder review to learn more.
8. Kiva US
- Debt crowdfunding
- Interest-free loans
- Best for startups & small businesses seeking $10K or less
Kiva US (see our review) is a crowdfunding service that fundamentally differs from both Kickstarter-esque rewards crowdfunding sites and equity crowdfunding sites. Kiva US is a debt crowdfunding site, which means you solicit a loan from a crowd of lenders. What makes Kiva US distinct from other “crowdlending” sites, however, is the fact that Kiva’s loans are interest-free. Though you’ll still have to pay back the loan, it’s just about the closest thing to free money as you’re ever likely to encounter in the business world. Kiva’s goal is to extend lending to businesses that would otherwise struggle to qualify for traditional loans.
Crowdfunded loans from Kiva US may be interest-free, but you’ll have to endure a waiting period of up to two months before you see any funds. The application process for a Kiva loan is as follows:
- Fill out an application online
- Enter the approval stage
- Enter a 15 day private funding period
- Enter a 30 day public funding period
- Get funds within 5 – 7 days
Companies using Kiva US can raise as little as $25 and as much as $10,000. However, the maximum amount you can borrow will depend on the age of your business, among other factors. If you need to raise more than $10,000, Kiva US isn’t for you. Your term length can be anywhere from six to 36 months.
For the patient entrepreneur who needs a bit of cash to get his or her business up and running, there are few better options than Kiva’s interest-free crowdfunded loans. Read our full Kiva US review if you’re interested (and how could you not be?).
- Nonprofit microlender
- Provides loans and financial education
- Best for startups & small businesses who can’t get loans elsewhere
Accion (see our review), like Kiva US, is a nonprofit microlender devoted to helping businesses get funding with relaxed borrower qualifications and credit score requirements. Unlike Kiva, Accion’s loans aren’t interest-free, but you can raise a lot more money than with Kiva (up to $50K), and the terms and fees are very competitive considering that Accion lends to the sort of business banks look down their noses at.
While Accion is similar to Kiva US in some respects, it’s not actually a crowdfunding site. It’s more like a traditional lender. You won’t need to set up a campaign and solicit funds from interested backers. Nonetheless, I felt it was worthy of inclusion here because it’s such a helpful resource for the sort of companies and entrepreneurs who would struggle to get a loan from a for-profit lender.
Accion’s installment loans are offered for a variety of purposes:
- Startup loans
- Business loans
- SBA community advantage loans
- Daycare business loans
- Food and beverage industry loans
- Commercial real estate loans
- Nonprofit loans
- Holiday loans
- Lines of credit
- Loans to build credit
Accion’s loan qualifications vary depending on the US state you reside in. An Accion loan can have a term length from between six and 60 months, and interest rates vary from between 8% and 22%. Accion also requires the following of its applicants:
- You aren’t more than 30 days late on any bills
- You have not made late rent or mortgage payments in the last 12 months
- You have not declared bankruptcy in the last 12 months
- You have not gone through foreclosure in the last 24 months
- You will not have any mortgage rate adjustments due during the loan term
Read our Accion review to find out why the organization is a particular favorite of ours here at Merchant Maverick.
Kickstarter gets a lot of press for the innovative, wacky, and sometimes downright bizarre crowdfunding campaigns they have spawned. However, as we’ve established, Kickstarter is more exclusive than many of its competitors. This company is not for everybody. Fortunately, you have many choices when looking for a crowdfunding platform. The nine crowdfunders I’ve listed are all solid alternatives if you’re building a business that could potentially inspire people to willingly part with their money, whether through tangible rewards or just a really compelling case.
Crowdfunding may be an imperfect solution to the lack of capital available to would-be entrepreneurs. Nonetheless, the essential fact remains: The Crowd has money and can be convinced to part with it.
People want to feel as though they’re a part of something new, important, significant. Crowdfunding is one of the dwindling means by which folks can derive meaning by being a part of something larger.
Give them that opportunity. Give them the chance to experience how it feels to help steer the course of history.
Be the next RompHim.