Kickstarter vs Traditional Funding to Start a Company

Pros

  1. Validate your idea and business model
  2. Grow a fanbase
  3. Get funding

Cons

  1. Spreading an idea early opens the door to copy-cats. In our case, we did apply for a patent (though we decided early on to fight infringement with innovation, not litigation), and we did have our idea copied.
  2. Standing out. As crowdfunding has gotten more popular, and since the barrier of entry is low, the signal-to-noise ratio is tough. I do have a counter to this one though, and this may be selection bias as I only have the one experience from running a campaign, but I do believe that the campaigns that were well thought-out and received a lot of time investment on prep inherently stand out from those that people pop up in a few days to ‘see what happens’.

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alexanderobenauer.com

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