Hubbub – “So, I guess you’re screwed now Kickstarter’s here…”
At Hubbub, we meet a lot of people and talk to a lot of people about crowdfunding. We pitch to investors, education departments, student unions. And we have been explaining crowdfunding to the UK market now for over a year.
In that time, we have been asked countless times why the education-sector needs its own platform, and why our projects cannot just go and use Kickstarter. With Kickstarter’s launch in the UK today, that question becomes even more pertinent!
However, it’s also an extraordinarily short-sighted question, from the point of view of general UK platforms as well as niche sector platforms. Here’s why…
Let me start by answering the question for all the UK crowdfunding companies. Will Kickstarter destroy my market? The answer, emphatically, should be “no”. Kickstarter is about to educate 60 million people about crowdfunding in a way that none of us could afford to do, generating coverage and traction across the UK’s media, and spreading the idea to the far reaches of the country, into a vast number of exciting new sectors and areas. Every single UK crowdfunding website will see a surge of interest over the next year due to Kickstarter’s arrival. The most vulnerable are those which are literally clones, but even those will see a large number of new users and projects, primarily from people whose projects don’t fit the Kickstarter model.
So no, we’re not screwed. We’re for the most part absolutely thrilled that Kickstarter is doing free promotion for us. Our Google Analytics data is already showing what Kickstarter’s UK launch is going to do to our business…
Niche Platforms – the Education Sector
To extend the point a little – the “niche” platforms (those that don’t compete with Kickstarter, or compete in a very specific sector) are even better off. The reason is that they will receive increased traffic and benefit from increased awareness, but will not suffer from any loss in potential projects migrating to the Kickstarter platform. This is particularly true for us at Hubbub.
Hubbub makes education-sector crowdfunding platforms. Why should the education-sector have its own platforms? It boils down to a simple thing: “community”. When you back a project on Kickstarter, you are backing a concept, idea or team because you want the reward or because you think the project itself is incredibly cool (or both). For the most part, you have no personal connection or interaction with the project’s creator. You aren’t going to fund their next project unless it is equally cool, and you aren’t going to check out projects that are done by other people in their company. What Kickstarter was – and to some extent still is – is a series of microfunding sites – one for each project – with a shared login system.
Hubbub is very different. We have only been live for around 6 months, but we are building a real community of users – both project creators and project sponsors – whose use of the platform is centred around institutions. In the education sector, once someone has made their first donation, the chances of them donating again next year approach 70%. And the philanthropic donation market itself is enormous – around £15bn every year is given to education-sector institutions by individuals making sub-£30k donations. Hubbub has already generated an active community of repeat project donors, giving multiple pledges to projects where there is a connection to the university, school or college of the project. This repeat donation process is immensely valuable.
Moreover, we have a network of project creators. Some of these have started to create a second project. Many have opted to become “helpers” on new projects on Hubbub. Yet again, we have a community of repeat site users, each and every one adding value back to the network in terms of projects, pledges and help.
Hubbub is building a network of platforms – and communities – centred around these institutions, and the people associated with them.
As a final point, 95% of the projects on our website would not be accepted by Kickstarter. This helps to demonstrate further that it is not a competitor – it is a similar tool for a different market.
So, what is Kickstarter’s UK launch doing for us? It is bringing the word crowdfunding to the lips of everyone. And when times are tough, anything that promises a silver bullet to assist with fundraising gets a huge amount of attention.
Kickstarter is a revolutionary company. It has almost single-handedly put crowdfunding in the dictionary. It is sure to have a significant impact on the UK creative industries, as it has done in the US. Its launch in the UK is educating the education sector to the power of crowdfunding.
We have been waiting for this moment for over a year. So, welcome Kickstarter, and thanks for all the projects.