Comments on: How to Figure the True Cost of a Kickstarter Project http://coffeeandcelluloid.com/2010/03/04/how-to-figure-the-true-cost-of-a-kickstarter-project/ Adventures in the Image Thu, 19 Aug 2010 14:16:04 +0000 hourly 1 http://wordpress.org/?v=3.0 By: Crowdfunding best practices (UPDATED) « NoFilmSchool http://coffeeandcelluloid.com/2010/03/04/how-to-figure-the-true-cost-of-a-kickstarter-project/comment-page-1/#comment-26062 Crowdfunding best practices (UPDATED) « NoFilmSchool Tue, 25 May 2010 17:01:43 +0000 http://coffeeandcelluloid.com/?p=1286#comment-26062 [...] How to Figure the True Cost of a Kickstarter Project [...] [...] How to Figure the True Cost of a Kickstarter Project [...]

]]> By: Morgan http://coffeeandcelluloid.com/2010/03/04/how-to-figure-the-true-cost-of-a-kickstarter-project/comment-page-1/#comment-23136 Morgan Thu, 01 Apr 2010 17:12:11 +0000 http://coffeeandcelluloid.com/?p=1286#comment-23136 Joey! (and Andrew!) this is great and very well thought out I love what kickstarter can do and its great to see how it does what it does hope filming is going well! expect a new kickstarter backer soon! Joey! (and Andrew!) this is great and very well thought out
I love what kickstarter can do and its great to see how it does what it does
hope filming is going well! expect a new kickstarter backer soon!

]]> By: Joey http://coffeeandcelluloid.com/2010/03/04/how-to-figure-the-true-cost-of-a-kickstarter-project/comment-page-1/#comment-21712 Joey Thu, 04 Mar 2010 19:08:55 +0000 http://coffeeandcelluloid.com/?p=1286#comment-21712 Yes, I did have the thought that these numbers will be more variable than I presented, because the fees and total budget will be adjusting. But if I read you right, the final number you figured out is the percentage of the fees off of $9000, however the $9000 already had some of the fees built into it, so yes, the final number would be more than $9000 (and I was rounding to make things easier), but it wouldn't be $9800, more like $9250 ($8538/0.918). I think an overall 5% to 10% buffer might be an easier solution, also because you'd need more backers to make up for the additional money, since I figured it from $7500. It's kind of this confusing cycle that I'm not clever enough to fully break into and make a Google Doc formula of. Like I said, it's an approximation and more food for thought. And if you reach your goal in an early time frame, you'll most likely exceed it too. Yes, I did have the thought that these numbers will be more variable than I presented, because the fees and total budget will be adjusting.

But if I read you right, the final number you figured out is the percentage of the fees off of $9000, however the $9000 already had some of the fees built into it, so yes, the final number would be more than $9000 (and I was rounding to make things easier), but it wouldn’t be $9800, more like $9250 ($8538/0.918).

I think an overall 5% to 10% buffer might be an easier solution, also because you’d need more backers to make up for the additional money, since I figured it from $7500. It’s kind of this confusing cycle that I’m not clever enough to fully break into and make a Google Doc formula of.

Like I said, it’s an approximation and more food for thought. And if you reach your goal in an early time frame, you’ll most likely exceed it too.

]]> By: Andrew http://coffeeandcelluloid.com/2010/03/04/how-to-figure-the-true-cost-of-a-kickstarter-project/comment-page-1/#comment-21711 Andrew Thu, 04 Mar 2010 17:36:30 +0000 http://coffeeandcelluloid.com/?p=1286#comment-21711 Math check - since you assessed the kickstarter and amazon fees at the $7,000 dollar level, the "new project budget" is not accurate. if you change your budget to $7,574, your fees would come in at that amount, making the total add on $621 instead of $574., meaning you'd still come in shy of your required $7,000 by $47. Kickstarter Fee: 5% of $7000 = $350 Amazon Fees: 3.2% of $7000 = $224 New Project Budget = $7574 the numbers should look like this: Kickstarter Fee: 5% of $7574 = $378.7 Amazon Fees: 3.2% of $7574= $242.4 New Project Budget = $7621.1 Which in turn, readjusts the fee assessment. Instead, the proper formula should be something like: B - (.05B + .032B) = X Solve for B, given that X = $7,000 B - (.082B) = X B - .082B = X B*(1 - .082) = X B*(.918) = X .918B = X B = 7000/.918 B = $7625.27 And now that you've raised the budget to $9,000, those fees adjust accordingly. .918B = X -----------> X/.918 = B Solve for B, given that X = $9000 $9000/.918 = 9803.92 Therefore, your final budget request should be closer to $9800. However, since you've already included the fees but assessed them at a lower budget request, it throws off these numbers too. The point being, it pays to be flexible. Give yourself a 10% contingency so that you have wiggle room to function. If you add ten percent to the final budget and the fees take out 8.2%, you're still up 1.8%, which allows you to cover additional postage or whatever incidental costs come up over the course of the project. It should also be noted that 0.918 is 1.00 - (.05 + .032). If the fees vary, change the numbers accordingly. Math check – since you assessed the kickstarter and amazon fees at the $7,000 dollar level, the “new project budget” is not accurate. if you change your budget to $7,574, your fees would come in at that amount, making the total add on $621 instead of $574., meaning you’d still come in shy of your required $7,000 by $47.

Kickstarter Fee: 5% of $7000 = $350
Amazon Fees: 3.2% of $7000 = $224
New Project Budget = $7574

the numbers should look like this:

Kickstarter Fee: 5% of $7574 = $378.7
Amazon Fees: 3.2% of $7574= $242.4
New Project Budget = $7621.1

Which in turn, readjusts the fee assessment. Instead, the proper formula should be something like:

B – (.05B + .032B) = X

Solve for B, given that X = $7,000

B – (.082B) = X

B – .082B = X

B*(1 – .082) = X

B*(.918) = X

.918B = X

B = 7000/.918

B = $7625.27

And now that you’ve raised the budget to $9,000, those fees adjust accordingly.

.918B = X ———–> X/.918 = B

Solve for B, given that X = $9000

$9000/.918 = 9803.92

Therefore, your final budget request should be closer to $9800. However, since you’ve already included the fees but assessed them at a lower budget request, it throws off these numbers too. The point being, it pays to be flexible. Give yourself a 10% contingency so that you have wiggle room to function. If you add ten percent to the final budget and the fees take out 8.2%, you’re still up 1.8%, which allows you to cover additional postage or whatever incidental costs come up over the course of the project.

It should also be noted that 0.918 is 1.00 – (.05 + .032). If the fees vary, change the numbers accordingly.

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