Platforms like Kickstarter and Indiegogo have not only expanded access to funding for struggling companies in the capital markets, but have also transformed the way companies connect with consumers during the product development process, transforming focus groups into actual customers with a stake in the end product. Replaced with . Despite the many benefits of crowdfunding, many campaigns still fail. To understand why, the authors undertook an empirical analysis of 18,173 campaigns for real products in the Technology and Design categories on Kickstarter. They found that many companies often present early products that are so fully developed that customers do not believe that their input will make a real difference to the product and are consequently reluctant to contribute.
Crowdfunding mobilizes $1.3 billion to finance innovation each year, and that amount is expected to more than double in the next five years. Platforms like Kickstarter and Indiegogo have not only expanded access to funding for struggling companies in the capital markets, but they have also transformed the way companies connect with consumers during the product development process, creating focus groups for those with a stake in the end product. Replaced with actual customers. .