Indiegogo is a crowdfunding website. It is situated in America. It was founded by Danae Ringelmann, Slava Rubin, and Eric Schell in 2008. The headquarters of the company is located in San Francisco, California. Indiegogo is one of the first sites to initiate online crowdfunding. Crowdfunding is made easy with Indiegogo. The company provides several options for the investors to pay for the campaigns on the website.
Indiegogo abides by some basic rules for campaigns and investments in the same. One of these rules is that any individual between the age of 13 and 17 cannot be active on the website with parental guidance. The consent of a legal guardian is essential for any minor to use the site. No campaigns can be run to get funding for illegal activities or things that are clearly not possible. It is illegal to post a fake campaign on the website.
It is essential to understand that Indiegogo does not support any kind of lottery or gambling on their website. It is illegal to offer the same via a campaign. It is also not acceptable to post about hate, injury, or other campaigns which violate the right of others. All the campaigns being posted on the website has to be for a cause that benefits someone for a good initiative.
How Does Indiegogo Work?
Now that we know the purpose of the website, let’s understand how does Indiegogo work for the several stakeholders involved in the business model of the website. The site provides different benefits to different entities and to build a business similar to Indiegogo, it is essential to understand how does Indiegogo work for all of these separately.
- How does Indiegogo work for Fundraisers?
- Step 1: Make an account
- Step 2: Create Your Campaign
- Step 3: Launch Campaign
- Step 4: Promote the Campaign
- Step 5: Collect Your Funds
- How Does Indiegogo Work for Donors?
- Step 1: Create an Account
- Step 2: Browse through the Campaigns
- Step 3: Select Perks
- Step 4: Add your Bank Details
- Step 5: Choose Your Display Name
- Platform Fee
- Transaction Fee
- Transfer Fee
- Indiegogo Business Model Canvas
- How to Launch Your Own Business Similar to Indiegogo?
How does Indiegogo work for Fundraisers?
Fundraisers are the primary stakeholders of the company. They play a significant role in understanding how does Indiegogo work. Fundraisers put up campaigns on the website which is the root of the business that the company is running.
The Fundraising process on Indiegogo
To understand how does Indiegogo, it is essential to understand the basics of the business. The core function of the website is crowdfunding and the process of fundraising is discussed in detail below:
Step 1: Make an account
The first step to creating a campaign on Indiegogo is making an account on the website. One needs to add in personal details and have a verified account to create a trustworthy campaign. Indiegogo has strict regulations to keep the authenticity of the campaigns in check
Step 2: Create Your Campaign
Once your account is made, you can create your campaign on Indiegogo. In this step, you need to add all the details of your campaign and the purpose of the same. It is always recommended to add as many details as possible. One can also add pictures if any. Other features of the campaign are perks for the reward backers, campaign targets, and others.
Step 3: Launch Campaign
When the campaign is designed, the fundraisers can launch the campaigns and go live with it. Once the campaign is live, the fundraisers can track the progress of the funds in their account. The launch of the campaign plays an essential role in the success of the campaign.
Step 4: Promote the Campaign
Now, the fundraisers can share the campaign on various social media platforms. They can also mail it to several people at a time and increase the chances of the success of the campaign. The more any fundraiser promotes its campaign, the more successful the campaign will turn out to be.
Step 5: Collect Your Funds
Once your campaign ends, Indiegogo disburses your funds to the bank account linked with your account or drive on the website. This disbursement takes place after 15 days of your campaign. It takes 15 days for Indiegogo to evaluate the campaign and the funds raised after the campaign ends; hence, the disbursement is done after 15 days.
This is the entire fundraising process on Indiegogo. This is how does Indiegogo work to raise funds for the best causes in the world. The understanding of this necessary process is the ground for analyzing how does Indiegogo work in different aspects of the business.
How Does Indiegogo Work for Donors?
Now that we understand how does Indiegogo work for fundraisers let’s also understand the other side of the business – the donors. The platform has several options for donors who want to pledge money for the best causes in the world. It gives philanthropists, a more accessible opportunity to make their pledges to any of the thousands of campaigns launched on the website.
Here is how does Indiegogo work for the donors on the platform:
Step 1: Create an Account
The backers are also needed to make an account on the website. Some personal details are required to make an account on the platform
Step 2: Browse through the Campaigns
Once the account is created, the backers can browse through the various campaigns available on the website. There are several options available, and the backers can choose the cause or the project they want to support and pledge money to that particular campaign
Step 3: Select Perks
Several campaigns offer perks for the backers. One can choose from the various perks available for the backers in different campaigns. These perks can be one of the determinants for the campaigns one wishes to pledge for
Step 4: Add your Bank Details
Once the backer has decided on the drive they want to guarantee, they need to add their bank details on the platform. It is essential to note that Indiegogo has a secure payment processor and backers can trust the platform entirely. The backers can add both debit or credit card details on the website and proceed with the payment
Step 5: Choose Your Display Name
Each contribution on any campaign is displayed on the platform. Indiegogo provides options for the backers to choose the name they want to get displayed on the contribution. The donors can select their own name or someone else’s name as well. They can also choose to go anonymous with their donation. This is ultimately the choice of the backer and they can customize their names as well.
This is how does Indiegogo works for the backers. This is essential to understand since the backers are the primary source of how does Indiegogo make money. They influence the campaigns and the revenue generated by the company.
Additional Features of Indiegogo
Some of the other features are important to understand how does Indiegogo works. These features enhance the user experience and give the fundraisers a better platform to raise funds for their projects.
Here are the additional features of Indiegogo:
- Classification of Projects: The platforms provide the fundraisers with a feature where they can add tags to their campaign which leads to the rating of their projects. The classification of campaigns helps the fundraisers to make their campaigns discoverable with the specification.
- Periods: The campaigns are also divided based on the launch time of the campaigns. Some campaigns are just launched or are ending soon. This helps the backers to browse through the category they are interested in.
- Top 10 Finds: Indiegogo also provides the backers with a list of the top 10 finds of the campaigns launched on the platform. This helps the fundraisers to become more discoverable on the platform.
How Does Indiegogo Make Money ?
While building a business similar to Indiegogo’s understanding of how does Indiegogo make money plays an essential role in understanding how does Indiegogo work. The revenue model is significant for the businessmen in the picture and hence given below are the different streams of income for the company.
This is a basic fee charged to the fundraisers by the company for providing a platform to raise funds for their projects. This is one of the primary ways of how does Indiegogo make money. The fundraisers are charged 5% of the funds they have raised from the platform. It is essential to note that the platform fee is charged only on the funds raised by the campaign created and not the goal set at the beginning of the campaign.
This fee is charged by the payment processor used by the donors to pledge for the campaigns. The transaction fee is charged on each pledge made, and the processor deducts it during the transaction itself. Different modes of payment have a different ratio of transaction fee which the campaign creator must keep in mind. This is another way of how does Indiegogo make money on the platform.
The transfer fee is charged by the company when the funds are transferred to the fundraiser’s bank account. This is because most banks charge a small percentage of the funds as service charges to the company. This transfer fee is essential for the company since transferring the funds is the end goal of the campaigns created. It can be said that this is a secondary option of how does Indiegogo make money through the platform.
Indiegogo Business Model Canvas
Along with how does Indigogo work, let’s have a look on the cost structure of Indiegogo have like wise been recorded.
How to Launch Your Own Business Similar to Indiegogo?
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