Indiegogo, the crowdfunding website often overshadowed by bigger and better-known competitor Kickstarter, is shedding some light on its numbers.
The San Francisco company, which allows customers to raise funds online for their projects, says its users have raised “significantly above” $500 million since its 2008 inception. That’s about a third of the amount that Kickstarter users have raised in roughly the same time period.
Indiegogo is also changing the fees that it charges, to make them simpler and in many cases lower. Currently the crowdfunding site charges people between 4 percent and 9 percent of the funds they raise, depending on the type of campaign they run, plus 3 percent to 5 percent in credit card fees. But starting July 15, Indiegogo will switch to a flat 5 percent price, plus card fees. That’s similar to Kickstarter’s current prices.
“Our new simplified fee structure provides a better value for campaigners by lowering our highest fees and simplifying our entire fee structure,” an Indiegogo spokesman said in an email.
Indiegogo's current fees and funds raised to date indicate that, like Kickstarter, its lifetime revenue is likely fairly low. Last year, Quartz estimated that Kickstarter had taken in roughly $43 million in revenue on then-$849 million worth of transactions. If Indiegogo has been charging between 4 percent and 9 percent on transactions of $500 million or so, some back-of-the-envelope math puts its lifetime revenue in the ballpark of $20 million to $45 million.
Indiegogo, founded by Danae Ringelmann, Eric Schell and Slava Rubin, has helped fund some prominent projects in tech, arts and film. Success stories include activity tracker MisFit, which went on to raise $65 million from more traditional investors, and a documentary about the late film critic Roger Ebert, which played at last year’s Sundance Film Festival.
The company often competes closely with Kickstarter, which provides similar services and goes after similar business. But Indiegogo is somewhat more flexible: It allows customers to raise money for charitable projects, whereas Kickstarter bans users from fundraising for charities’ operating expenses. Indiegogo also allows people to keep the money they raise, even if they do not meet their project goals, whereas Kickstarter has an “all or nothing” model for its users’ projects.
A full comparison of the two crowdfunding platforms and their other competitors is available in Inc.’s “Essential Guide to Crowdfunding,” now online and in our July/August issue.