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Kickstarter Stats and a Connection to Crowdfunding for Equity
Posted on 18th July 2012 By andy

Kickstarter recently launched a new live stats page with some interesting data.  I analyzed the data with the hope of finding some trends that might bleed into equity crowdfunding.  First I’ll discuss some interesting findings from the Kickstarter data before illustrating a potential connection to equity crowdfunding.

From the data available I felt there were two important questions to be answered.  First, which categories get the highest percent of their projects fully funded?  All projects on Kickstarter have an average of about 44% fully funded success rate.  Figure 1 shows that dance, theater, and music all get more than 50% of their projects funded.  While, technology and fashion are lagging with success rates below 30%.

Figure 1.

This leads me to my next question.  Dance, theater and music have the most likelihood of being fully funded, but how much capital do they actually raise?  In Figure 2, you’ll notice that these three raise the highest percent of their money in the $1,000 to $9,999 range when compared to the rest of the categories.  On the other hand, design, technology and games have most of their money raised in higher funding ranges.  Interestingly, as seen in figure 1, these three also have some of the lowest success rates on Kickstarter.  So it seems that these categories are either boom or bust.

Figure 2.

The reason for these outcomes could be because dance, theater and music project owners are looking for a smaller amount of money for their projects so they get funded easier.  Furthermore, design, technology and games project owners could be looking for high amounts of money for their projects.  Thus creating a boom or bust scenario.

My last chart (Figure 3) shows the correlation of success rate verses the percent of projects over $20K by category.  I chose $20K because I felt it separated well the low budget projects from the high level projects.  Again this design, games and technology have the strongest correlation.

Figure 3.

We believe the two questions answered above for Kickstarter data: “which categories get the highest percent of their projects funded?” and “which categories raise the most money when funded?” are going to be very important questions for the crowdfunding for equity industry.  Crowdlanding will be executing this analysis for the crowdfunding for equity industry and making it available.  In this industry, everyone wants to pick the winner because it is in our best interest to do so.  We want to pick both the winner of the crowdfunding experiment and the company that will return the most on our investment.

 

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