Crowdfunding: The latest way to get your project funded

Sites like Kickstarter offer both established businesses and startups a chance to finance their dreams.

By , Computerworld |  Business, crowdfunding, kickstarter

Programmers, manufacturers and developers who want to realize their creative vision without signing onerous contracts or relinquishing rights to their intellectual property now have an alternative to venture capitalists. Crowdfunding -- the collection of funds directly from a target audience -- has taken off. Small donations are adding up to hundreds of millions of dollars, many of them channeled through a service called Kickstarter.

Launched in 2008, Kickstarter is one of the leading crowdfunding services. According to an interview in online publication Talking Points Memo with Yancey Strickler, one of Kickstarter's founders, the company's currently on track to award more money in 2012 than the entire fiscal year 2012 budget for the National Endowment for the Arts.

Of course, Kickstarter isn't the only option. Besides other general crowdfunding sites such as Indiegogo, there are also focused alternatives, such as Feed the Muse for musicians, 8-Bit Funding for indie games and Sponsume for United Kingdom creators.

Kickstarter works this way: Artists create a project in one of 13 categories -- from music and photography to publishing and technology -- with a minimum funding goal and a funding duration of at least 30 days. Backers select a pledge amount -- from $1 to $10,000 -- and if the goal is met before the deadline, Kickstarter takes a 5% cut and, through Amazon Payments (which also charges a percentage of the transaction), processes all pledges and awards it to the designer (which is taxable as income).

If the goal is not met, then no pledges are collected and the artist gets nothing.

9 Kickstarter projects

We've gathered together a few interesting Kickstarter tech projects as a sample of what's out there; check out our slideshow:

Visual tour: 9 interesting tech projects from Kickstarter


Originally published on Computerworld |  Click here to read the original story.
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