Friday, March 9, 2012

Indie Funding for Indie Projects

There’s a radical new relationship among authors, publishers, and the internet. Some authors are taking financial backing into their own hands – or, rather, the hands of the public – through online collective fundraisers. They’re using sites like Kickstarter and IndieGoGo to make their appeals for funds directly to their audience.

Arsen (our head buyer and star of my last blog post) happened upon this KickStarter campaign after donating to a friend’s project: Parecomic – a documentary graphic novel about left-wing political activist Michael Albert by Sean Michael Wilson and Carl Thompson. They decided to use Kickstarter after the success of several comic books they pledged toward themselves. “There is not so much money to be made by most graphic novels (much as I love making them),” says Sean, “So this kind of help is a good boost.” This is Sean’s 16th book – so he’s no publishing n00b – but Parecomic is the team’s first project on Kickstarter.

Parecomic is set to be published by Seven Stories Press in Spring 2013 and they are supportive of the creators’ decision to seek supplemental funding. Anne Runberger, a publicist at Seven Stories, said this is the third book that they’ve worked with that has a Kickstarter campaign. Anne says “It gets people invested in a project if they’ve pledged to support it. You have all these people excited about a book.”

Another collective campaign that Anne mentioned Seven Stories having success with was Anna Anthropy’s Rise of the Videogame Zinesters. It’s about how and why the video game industry needs to change and how everyone can help make it happen. Anna’s campaign will support her publicity: “[Anna] wanted to do a tour. [Seven Stories is] a small press and doesn’t have the money for a tour. She went on IndieGoGo and [so far has] raised money to come to New York and go to Chicago.” IndieGoGo is another collective funding website, and how much Anna makes will determine where and for how long she will run her tour.

Collective fundraising campaigns are not for everyone though. Jayme Moye, local freelance writer and leader of the travel writing workshops here at Boulder Book Store, tried her hand at fundraising using ChipIn to help with the costs of covering a story in Kathmandu. About her experience, Jayme says, “I found that you’re still primarily marketing to your own inner circle. Everyone who donated was someone within my Facebook friends circle, who would have donated anyway…really, you’re just asking your friends and family for money. And I wasn’t too psyched about that.”

Here’s how the three online fundraising collectives I’ve discussed work: seems to be the simplest campaign site. Their homepage leads directly to where you can sign up for an account with them. The “rules” are general and the main promotional advantage is a widget they create for you to direct others to your ChipIn page. They basically provide a platform on which people funnel money into your PayPal account. Jayme doesn’t recall them taking any cut of the funds.

IndieGoGo is focused mostly on independent artistic ventures. Its marketing advantage over ChipIn is the ability to browse projects within a particular interest. So, for example, if you’re a philanthropist with a passion for theatre, you can browse both theatre and film projects and donate to help them reach their monetary goal. There are also rewards. IndieGoGo supporters can get a donation-based tiered prize package set up by the campaigners, specific to that project. For example, Anna is offering a poster for every $50 donation and a custom-made video game for $500.

There is also an algorithm within the website set up to increase your chance for success called the GoGoFactor: “The more activity you have on your campaign…the more likely you will end up on our homepage, in our social media outreach, or featured in the press.” In short, the amount of exposure you give your campaign increases the exposure IndieGoGo gives your campaign.

As a fundraiser, you can select two tracks for your campaign. In the first track, IndieGoGo charges a 4% fee on the money you raise and if you fall short, the fee is 9%. In the second track, you either meet your goal or don’t. If you don’t meet your goal within the time frame given for your project, all of the money is refunded to your contributors and no fees are charged. They also charge a 3% Third-party fee (for PayPal) as well as currency exchange fees and wire fees for campaigns outside the US.

Kickstarter’s setup is very similar to IndieGoGo with the basic difference being that you can only opt for the all-or-nothing style campaign. They are firm believers in this setup, saying that “1. It’s less risk for everyone… 2. It allows people to test concepts…without risk… 3. It motivates.” So if the campaign doesn’t meet the set goal, their likeliness of finishing the project is lower and the contributors won’t have wasted their money on something that’s never going to happen. If you MUST meet your goal, you will be more proactive about advertising for it.

Kickstarter’s campaigns have to get approval before they can launch – staff go through every submitted project and check it against their very specific list of Guidelines. Through this screening, they also increase the exposure of projects they particularly enjoy by selecting them for their staff picks. If your project is “really cool” you have the support of your friends and family as well as strangers who have chosen your project over the hundreds they screen every day.

The irony of Kickstarter lies within the vehicle through which the funding gets processed. All of these projects for individuals trying to make their small press and independent dreams come true have to set up an Amazon Payments account. Maybe this is only ironic coming from the point of view of an independent bookseller – as I, daily, encounter countless articles and testimonials about how Amazon is in no small part an element of why both the publishing industry and indie bookstores have fallen on such hard times.

Kickstarter’s argument for using Amazon Payments is that it’s the only credit card processing platform that they’ve found that will capture and then release the money back to the card if the project does not meet its goal. Kickstarter takes 5% of all funds raised and Amazon Payments takes “3-5%” for credit card processing fees.

Most of you are, to some degree, aware of the unsteady financials of the publishing industry over the last few years. The effects of this instability have manifested in higher book prices, a decrease in author tours, and in some cases more mass-produced, lower quality products. Perhaps online fundraising collectives can help ease some of those troubles. Sean was ever-hopeful that Kickstarter, and websites like it, could be one of many keys in the future to save the industry; “Hopefully both can continue together, and Kickstarter can help strengthen publishing.”

Parecomic came to Sean “as a result of thinking about society, about capitalism and alternatives to it. I checked out Michael Albert and the ZNET site and the ideas of Parecon there. I wanted to be involved in this effort by using my skills and love of the comic book medium.” Going back to what Anne was saying, “This is a way to rely on people who really care about those projects to make them happen.” Passion could be a large part of the currency exchange in an alternative new form of capitalism. If that is the case, and the direction in which we’re heading, passion is something of which booklovers have no shortage.

For more information about Kickstarter, interviewed their creator a few days ago (though I came up with my blog post idea before that!!!) about its role in funding indie film projects. What do you think about this new medium for fundraising? Have you donated to any projects or causes through an online collective?

Words to cover our legal behind:
*All information in the above post has been collected from communicating with the people involved and information found on the respective websites.

**I do not own the rights to any of the pictures above, I pilfered them from the websites of the people I interviewed. I'm happy to remove them if this is a problem.