How does Kickstarter work: funding, fees and rules for makers

How Kickstarter works, in short

Kickstarter is a crowdfunding platform for creative projects. A creator sets a funding goal and a deadline, and people back the project by pledging money in exchange for rewards, often the finished product. Funding is all-or-nothing: backers are only charged if the project reaches its fundraising goal, so if the goal is missed, no one pays and the creator receives nothing.

Kickstarter says in its own help center that Kickstarter is not a store. Backers support a product while it is still being made, and the creator owes them the rewards they pledged for. That is the main difference from selling: a backer pays for a promise, and the creator carries the work of making and shipping it.

Creating a Kickstarter account is free. Kickstarter's fees are collected from your funding total once a project is funded.

How a Kickstarter campaign runs, from launch to payout

Every project follows the same sequence. The dates and windows below come from Kickstarter's help center and terms of use.

1. Set the goal and the deadline

   Pick the amount you need to make and deliver the rewards, including fees, and a deadline. Campaigns can run from one day to 60 days, and Kickstarter says 30 days tends to work best.

2. Collect pledges while the campaign is live

   Backers choose a reward tier and pledge. No card is charged yet. Backers can change or cancel a pledge. During the last 24 hours of a campaign, they must contact Kickstarter support first.

3. Reach the goal, or miss it

   At the deadline, a project that reached its goal is funded. A project that missed it is not, and the creator pays no fees.

4. Wait while pledges are collected

   For a funded project, Kickstarter has a 14 calendar day window after the deadline to collect and process pledges. Some cards fail. If they do, creators still receive the balance of collected funds, less fees.

5. Receive the payout

   After the 14 days have passed, a payout will be initiated. The payout is the total collected minus the Kickstarter fee and payment processing fees.

6. Make and ship the rewards

   The campaign ends, but the work starts. The creator builds the product, posts updates and ships the rewards to backers.

Kickstarter fees: how much Kickstarter takes

Kickstarter fees apply only to funded projects. For a US creator, Kickstarter takes 5%, collected from your funding total, and payment processing by Stripe costs 3% + $0.30 per pledge. So Kickstarter takes the platform fee plus processing on every pledge, and nothing if the goal is missed.

Budget for fees before you set the goal. If the goal only covers production, the fees and failed pledges come out of the money you need to make the product.

What Kickstarter keeps from one pledge

Example: one $50 pledge on a funded project, compared with the same pledge on Indiegogo, using each platform's own published rates.

Kickstarter's rules for product projects

Kickstarter reviews projects against its published rules. For someone launching a physical product, these are the rules that shape the page and the rewards.

• All rewards must be new and unique.
• Rewards must be your own work: they must be produced or designed by the project or one of its collaborators.
• In design and technology projects, a prototype demonstration must show the product's current state. It should not include any CGI or special effects to demonstrate functionality that does not yet exist.
• A business that launches a project must say so: entity information must be disclosed.
• Creators must be transparent about how AI is used in the project.
• A project can give up to 10% of its funds to charity, if it says so at submission.
• Shops and resale are not allowed. Kickstarter prohibits marketplaces, meaning spaces where the primary purpose is to sell or re-sell items.
• Services are not allowed either. Projects cannot be centered around establishing and providing services.
• Changing the core of a project after it is submitted may result in the project being canceled.

These rules mean Kickstarter suits a new product you designed and will make. Stock you already sell, items made by someone else, and services fit a store better than a campaign.

What a maker owes backers after funding

Kickstarter's terms of use put the delivery obligation on the creator. The creator is solely responsible for fulfilling their project. Kickstarter does not offer refunds itself, so backers deal with the creator.

Delivery dates on reward tiers are only the creator’s estimate and not a guarantee. Delays happen, and Kickstarter's rules expect creators to regularly update their projects and respond to messages in a timely manner.

In practice, that means keeping records of what the money was spent on and posting regular updates, so that if something goes wrong you can show backers where the project stands.

Selling after the campaign ends

Kickstarter lets a creator keep taking late pledges after a successful campaign. Late pledges can be taken up until the time when they are first ready to fulfill the rewards. Late reward tiers must be offered at the same or a higher pledge amount as during the campaign, and they pay the same fees charged by Kickstarter on live campaign pledges.

A creator can also collect further payments through Kickstarter's own Pledge Manager. It charges a 5% platform fee, plus roughly 3-5% card processing on the full payment.

Kickstarter's help center says Kickstarter is not a store, so ongoing sales after the rewards ship need a store of your own. Backers who want more of the product can be pointed to that store.

Where Nation fits

Questions about how Kickstarter works