Friday, December 27, 2013

Kickstarter Project Budgeting 101

I'll take it your project didn't quite pass the 3-Question Test?  No worries, we can make this work.  Read below to learn steps that will ensure your project has an air-tight budget!


BASIC ACCOUNTING

To ensure your project doesn't go catastrophically overbudget, stick to the following rule:

MONEY IN > MONEY OUT

There are many accounting equations that we could use to define what a solid budgeting strategy, but the most simple concept is usually the best -- and to make this one work, you must fully understand both sides of the above equation to keep your project in the green.

MONEY IN

There is no way to know how much money your Kickstarter campaign will bring in.  I can't tell you how to guess that number.  I recommend that you set a reasonable goal, and promote your project everywhere you can in order to meet that goal.  (see this post on Creating Hype)  

What's reasonable?  Well, what's your target audience size?  For our upcoming Kickstarter project, "How Do Be Funny' -- we're following two comedians from Logan, UT on their journey to Hollywood to develop themselves as comedians/writers/actors, so our target audiences is essentially their current fanbase + other people from the local area + extra people that are just interested in the careers of young comedians.  So... not huge.  But we reflect that in our Kickstarter goal of $3000.  

Whatever goal you come up with, be sure to account for the 8%-10% cut of your pledges that go to Kickstarter and Amazon payments!!


MONEY OUT

Reward Fulfillment Costs

I put the reward fulfillment costs first because determining these costs will help you scope your project.  It was during this step that we decided to not offer physical copies of our documentary as a reward, but instead to offer downloads of digital copies of the film.  But as you're researching prices for fulfilling rewards, be sure to consider all possible costs (including packaging, postage, etc) to ensure you've picked a smart pledge amount for that reward.  Kickstarter recommends picking prices that your reward would retail at, but I've seen various interpretations of 'retail price'.

Project Costs

This is where you can really strengthen your budget by putting in the time to do your homework.  And this step is very dependent on what type of project you have -- a technology project will be focused on raw materials, production, packaging, etc, where an artsy project will be focused on other less concrete costs.  It helps to create a Work Breakdown Structure to identify all the steps required to complete your project, and build you budget off that.  

For example: If you were filming a documentary (HEY!) you'd want to research costs for individual pieces of equipment that you need, exact pricing for travel costs (use Kayak.com or similar websites and get the cost of a trip that would be about as many days/weeks out as you would book for the project), 

It's also smart to pick costs conservatively, meaning that if you were looking at the cost for a new lens, don't use the absolute lowest prices that you can find in your budget.  This builds a little cushion into the budget, where once you get the funding you can look hard for the good deals and use the money saved on things that cost more than you thought. Which leads in to the last type of cost to consider, the risk management costs.


Risk Budget Costs

This is maybe the most over-looked step in the budgeting process.  Make sure that you leave a chunk of money set aside to handle any emergency costs (what if you break a piece of equipment? etc).  How much money to set aside is a tricky question to answer because it depends on the amount of risk that's involved in your project.  I could do a whole post on risk, but just think about how likely it is that something goes wrong (are you holding an outdoor event in Seattle?) and how large of an impact that thing will have on your project (could delay your event for a day/week, can your project be that flexible?).  Also, the unknown-unknowns are hard to account for, so unless you're an old pro and have done similar projects many times, it's smart to research similar projects and see what type of things went wrong for them, then account for those in your plan.



PUTTING IT ALL TOGETHER

So, if you've followed the above guidelines, your budget should have a solid answer for the following questions with enough detail to bore your wife:
  • What does it cost to fulfill rewards?
  • What will it cost to finish the project?
  • What level of risk do I anticipate having to overcome with project funds?
Add those up, tack on the 10% cut that Kickstarter/Amazon claim, and feel confident that you've set a good goal.

Stretch Goals

I'm not going to debate here whether stretch goals are a good idea or not (there's been enough of that already), but if you do choose to create stretch goals, make sure you have a solid budget for each level of funding you could bring in, a lot of projects get into trouble by expanding the scope of their project via stretch goals, but failing to expand their budget accordingly (particularly the risk part of their budget)

The next steps:

Kickstarter Project Management Basics - a post on how to clearly define your project and set yourself up for success
Building Kickstarter Hype - a post showing ways to create an audience and build support

Is Kickstarter the right fit?

So you've got a great idea for a project you think the world needs.  Use the below test to check and see if your project fits the bill for Kickstarter!

The 3-Question Test:


Does your project have a clear ending?

Yes: Great!  next question...
No:  If your project is a vague Kickstarter won't let you use their platform to crowd fund and you'll have to find another avenue.  A great alternative is indiegogo.com, as their model allows for any type of cause/project/campaign is allowed.  OR, you can rethink your project in such a way that it has a clear ending, like if you were wanting to move to Detroit and start a business (no clear end), you could focus on creating a documentary that follows your journey, or launch your first product, etc.  That's essentially how the idea for the documentary "How Do Be Funny" was conceived.  We're kicking off crowd funding for that project in April 2014!


Does your project have mass appeal?

Yes: 2 for 2 -- you're crushing it!
No:  Because Kickstarter is an all-or-nothing fundraiser, if you can't raise the amount of money you originally wanted, you get nothing.  That's why having enough of an interested audience is vital -- no crowd?  NO FUNDS.  If you're making an album of your experimental cricket band's music (not recommended), you best make sure that you have enough of a fan-base, or potential fan-base, to fund your goal.  Otherwise you'll have wasted not only your own time and effort building a Kickstarter campaign that was doomed from the first chirp, but your fans will be disappointed and frustrated at time lost as well.


Do you have a solid understanding of how much your project will cost?

Yes: Shoot, son -- Giddyup!
No:  As mentioned above, Kickstarter's all-or-nothing model makes knowing how high of a goal to set a really important thing.  If you set your goal too high, you get no money -- but if you set your goal too low, you run the risk of not being able to deliver on your promises to your backers.  There have been several famous projects that are either way behind schedule, or canceled completely, simply because they didn't have a good enough understanding of how complicated their project was going into it.  


The next steps:

If you passed the test, let us know about your upcoming Kickstarter project in the comments -- we'd love to hear from you!  If you didn't pass the test, look for posts coming down the pipe on all of these topics: 

Kickstarter Project Management Basics - a post on how to clearly define your project and set yourself up for success
How to build your project's mass appeal - a post showing ways to create an audience and build support
Kickstarter Project Budgeting 101 a post on how to budget a Kickstarter project, including thoughts on hidden costs, acceptable risk, etc

Saturday, December 21, 2013

So, you want to be a comedian: Open-Mics


In this post, I'll explain my experience trying to break-in to the comedy world of a new city as an amateur stand-up comedian.

MY BACKGROUND: I got into comedy the 'easy' way, when a good friend of mine, Jordan Todd Brown, decided it was time to become comedians while we were still in high school. He rented out a community center in the area, borrowed some stage pieces, a mic, and a spotlight and invited me and a few of our friends to each do 10 minutes of standup. We charged $3 per person and were able to pay for the venue and, after a few shows, start getting some of our own equipment. I graduated and went to college out-of-state, but whenever I was back in town I would get a call from Jordan asking me to do 10 or 15 minutes of standup at one of his shows.  Then I graduated from college and moved even farther away from home, cutting my stage time from a few times a year to zero times a year. Now, I'm not a professional-level comedian AT ALL, but I DO need to get laughs on stage from time to time to feel good about myself. So I had to venture out on my own and battle the world of open-mics.  This, is my story.

STEP 1: Attend an Open-Mic


It’s important to know what you’re getting in to, because open-mic’s are nothing like the comedy special’s you’ve seen on Youtube, Netflix, or Hulu.  Google search “Open-Mic” and “your town” to find some place nearby that might host a weekly open-mic night, then go there!  You’ll be surprised at the vast range of people that get up and try out some of their ‘material’.  Hopefully this experience will build your confidence in the level of skill you need to bring to the table and motivate you to take the leap.

STEP 2: Develop Material


Comedians/blog collaborators Jordan Todd Brown and Mike Grover have written great posts on how to develop material, but I’ll offer my two cents: be yourself.  Write jokes about what you know, be it sports, drinking, family, or work.  For example: I’m Mormon, so lots of my material is focused on being Mormon.  I tell those jokes to rooms full of drunk non-Mormons and the occasional high anti-Mormon, and I do just fine because I take their perspective into account during my joke writing 


Then PRACTICE.  Before I take a joke on-stage, whether in my head or out loud to the mirror I’ll have done a complete run through of the joke maybe 10 times.  I’m not doing a word for word memorization, but every time I recite the joke it gets a little better because I pick up on things to emphasize or things to embellish by adding a face/noise/voice.  The more times you’ve done the joke, the more confident you will be on stage – the more confident you are on stage, the more people will be able to just focus on what you’re saying without the distractions of your nervousness.

STEP 3: Perform at an Open-Mic


When you’re feeling pretty confident with your material, head back to the open-mic and sign up!  They’ll let you know where you fall in the lineup as well as how many minutes of material they expect you to fill (typically 3-5 minutes).   Stick within the time limit!  It’s a really rookie mistake to take too long or finish too early, and a sure-fire way to never make it past the open-mic level.  When they announce your name, take the stage, grab the mic, and kill it!  Keep eye contact with the audience, and don’t feel dumb if you have to refer to your notes (even the pros refer to their notes). 


STEP 4: Repeat


This is the stage I’m at right now.  Keep going back to open-mics and getting to know the other comedians.  If you’re funny, keep to your time limit, and make the right friends, before long you may get invited to do a short set at a stand-up show, and you can build from there. Watch for Jordan and Mike’s upcoming posts about the next stage of a comedian’s life (organizing and hosting a stand-up show, being the opener, being the headliner, etc) and stay excited about comedy!