Once I had made the video presenting the project, the next thing to consider for my crowd funding campaign was the budget: how much money did I need to ask? Initially, I thought I would only need about £2,000, but when I started doing the maths, I realised that things were adding up VERY quickly, and ended up asking for £5,500. So yes, it sounds obvious, but actually writing down with a detailed budget is really important. You’ll realise you need way more money than you think (regardless of whether you pay for some it yourself, or include everything in your budget). And that’s even before the other “hidden” costs that come with using Kickstarter.
I’m actually quite surprised of how that went. I was expecting to be drowned in questions along the lines of “How dare you ask for so much money?! If I was you I’d only need such and such amount”. It turned out I only got one comment of the sort. I guess it’s because I’ve been quite upfront with what I was going to do with the money. I did tell what was the money going to be spent on, and in which proportions. I didn’t put any detailed amounts though, because I didn’t feel I owed anyone that level of transparency. However, when the ratio felt high, I did explain why that much money was allocated to a given expense. And those numbers came up by leaving little to nothing up to guestimation.
Thinking the travel costs through
As mentioned in the project description, the main reason I was asking for money was to cover travel expenses. But how much does it cost to travel exactly?
There were a couple of big questions that I needed to answer in order to determine the cost of flying somewhere to shoot:
How long am I going to stay there?
If I’m filming at a three day event, I want to at least arrive a day before, and leave a day after. That’s 3 nights of accommodation. I want at least a day where I can shoot some B-Roll to get establishing shots of the area where I am shooting (especially if I want to put some time lapse in). That’s most likely another night of accommodation. You could rightly argue that this could be done in the before or after event day, but chances are you’ll be fighting jet lag on the day before, and trying not to miss your plane on the day after. Plus, it always feels like you never have enough B-Roll, so taking a full day for that doesn’t seem like a bad idea. And you can also get cool stills that you can use elsewhere.
Then, if I’m looking to interview the organisers of an event, I want to do that before the event, otherwise I’m drastically reducing my chances of getting hold of them. So add at least another day and a night of accommodation.
So filming a 3-day event will usually require me to be there for 6 days and 5 nights. Even if you go for a low-cost hotel, 5 nights can easily cost up to £250 depending on where you’re going. Shared room hostels are out of the question for insurance reasons (unless maybe they have lockers, but depending on how much gear you’re travelling with, that might not be an option). There’s the argument for couch surfing, but there are two counters to that. First one being insurance again if you crashing at a stranger’s place (I’m not saying that hosts aren’t trustworthy, but if you end up in an unlucky situation, your insurance isn’t likely to sympathise). The other argument I’d have against couch surfing is that I might want to come home late, or leave very early to film a night lapse or catch a sunrise and/or I might be so busy that I won’t be able to spend any time with my host, making me a terrible guest.
The duration of your stay does not only affect accommodation costs, but also food, local travel costs between venues and your “base camp” (be they bus/taxi fares or car rental rates, petrol and potential parking charges), and the cost of using your phone and accessing the Internet (where available) in a foreign country.
How much does the flight REALLY cost?
There are a few things to consider on top of the plane ticket:
- Baggage: One should keep in mind that low-cost airlines charge you for every checked baggage, and depending the amount of equipment you’re bringing with you, you can have quite a lot of cases. Being on my own and shooting light, I managed to get everything in one checked bag plus one carry-on bag. Using an airline where the first checked baggage is free means I have no extra cost.
- Shuttles: Airports usually aren’t within walking distance of anything (even with the most reasonably generous definition of the term). So you need to figure out how to get from your own home to your local airport and back, as well as how to get from your destination airport to your accommodation place and back. Can you get a lift, or do you need to get a taxi, the bus, the train, or even rent a car? That’s mostly depending again on how encumbered and connected you are, and how close to where you need to be public transport can get you. And if you’re having to drive to your departure airport, you’ll have to pay for parking space for however long you are away (see previous question). Regardless of the option you’re choosing, it’s a cost you cannot avoid, so it’s best to know how much it’s going to be.
When you take all the above into account, a £300 flight can result in a trip costing 3 or 4 times that amount. I thought I was being excessively cautious when I estimated the cost of my trip to Boston at £950, but in the end I spent a little over a grand, so I’m glad I wasn’t being too optimistic.
Once you’ve done all those calculations you end up with a budget, which may or may not look excessive to the public eye, but before they even see that, you have to apply the Kickstarter buffer.
What they see isn’t what you get
A lot of people, especially those who like to try and break down your budget and tell you how you’re asking for too much, tend to forget that for a project creator, using Kickstarter isn’t free. Granted, there’s is no upfront cost, and you don’t pay anything if the campaign fails. But if it does succeed, Kickstarter takes a commission on the amount raised, and you have to pay VAT on those fees. For my project, it amounted to 10.37% of the money raised. So you have to adjust your target so that the campaign pays for itself, which bumps the price tag in the eyes of the potential backers. Fortunately, Kickstarter is completely transparent about those fees, and you can calculate them quite accurately to determine by how much you need to extend your campaign target to cover for the fees. But that’s only the tip of the iceberg.
The silent killer: reward costs
In the eyes of many backers, Kickstarter is some kind of online store. They give you money, they want something in exchange. So project creators are tempted to set up reward levels that will give people things. The biggest mistake a Kickstarter project creator can make is underestimate the cost of producing and delivering the rewards they promised, especially if they’re physical objects.
Let’s say you offer a t-shirt with the £20 reward level, and it costs £15 to make and ship that t-shirt. For every person who pledges £20, only £5 will be used to actually fund your project, even though the whole £20 counts toward reaching the target. What’s worse is that if you need to charge extra for overseas shipping, that’s even more money that doesn’t help you complete your project yet counts against your target.
In one way it’s a good thing as it makes you reach your target more easily, but it’s a double-edged sword. It’s not unheard of for creators to have had successful campaigns and yet fail to deliver the final product because they massively underestimated the cost of delivering the rewards.
I tracked the campaign using a spreadsheet of my creation, and calculated the various costs as the campaign went on, and noticed the impact of reward costs. When the project was 116% funded, once I took away the Kickstarter fees and the reward costs, I realised that I was only getting 99% of the budget I actually needed. “Close enough”, I hear you say, which yes, in my case is true, but it’s all about that 17 percentage point difference. For a project that really needs a specific amount of money, that can leave its creator(s) in the lurch.
The problem is that, unless you can see the future, there isn’t really any way to predict how many people are going to chose which reward so it’s difficult to account for it. For reference, here’s the split on reward popularity for Back to the Source:
Most of my backers have chosen a digital download, which is a virtually costless reward (though 200 people downloading a several Gigabytes file from a secure server is going to have some cost), so I guess I was pretty lucky on that. Even though I wasn’t going crazy on physical rewards, there’s about £500 of the amount I’ve raised that I have to keep to one side so I can deliver those physical rewards. That’s 7.4% of the money raised (before Kickstarter fees).
The rewards that worked unexpectedly well were the producer credit perks. I stole the idea from other successful Kickstarter film projects, and thought it was worth trying. I got two £500 pledges for executive producer (Thanks to Darren Priest and Corinna Vigier). When you compare that to the most popular reward, the £20 digital download, that represents FIFTY backers. When your documentary is about a relatively niche community, having to convince 48 fewer people to support your project is quite a big deal.
- When determining a budget, being excessively thorough will spare future headaches.
- Beware of physical rewards
- For some people, the most valuable reward isn’t a physical object.
In the next and last part of this post mortem, I’ll be taking a look at how the marketing side (let’s call it what it is) of the campaign went.