If you are building hardware and want to raise the big money — I mean, $100,000 or more at first and later some venture capital — Kickstarter is the way to go, according to data released Monday by CB Insights. It’s no secret that crowdfunding sites like Kickstarter or Indiegogo are great places to pitch your hardware prototype to future customers in hopes of financing a production run and getting outside interest from possible backers, retailers or the press.
What’s been less clear is which crowdfunding site confers the most advantage if raising venture capital is one of your goals. The answer is that you have a greater change of raising more money in a campaign, but only a slightly greater chance to attract venture capital if you use Kickstarter over Indiegogo.

Kickstarter changed its rules in 2012 to make it more difficult for hardware concepts to raise money, but it reversed position this summer, perhaps in the wake of several high-profile companies choosing Indiegogo. Yet, the Kickstarter name still has the biggest brand awareness among mainstream consumers, which means that companies still list there.

The data covers questions such as which geographic regions VC-raising startups hail from (mostly California) and which startups have raised the most money (Misfit, FormLabs, SmartThings, Pebble, Ouya). However, my hope is the next CB Insights report tackles some of the outside pre-order efforts that companies such as Lockitron, Ringly and others have built outside of the big two crowdfunding options. I’m wondering if in the case of companies that are coming out of accelerators or working with design or engineering shops like Dragon Innovation are raising venture capital at a higher rate.
I also wonder what the impact of a successful crowdfunding campaign is on the valuation and how it might affect the eventual exit strategy. If you recall, when Oculus Rift, the VR headset maker was purchased by Facebook, some crowdfunding supporters were miffed. We’re going to get answers to these questions at our Structure Connect show in San Francisco on October 21 and 22 with a panel featuring speakers from Indiegogo, Ignition Partners and more.
I too would like to see the comparison of successful raises from accelerators vs good design firms. But I would have think that crowd funding is a primary source of early validation that a VC would weight heavily when considering to invest. Thanks Stacey, this article was helpful as we are contemplating which platform to use.
Dear visual editors, The difference between 9.6% and 9.0% is not a double bar length, unless you are Kickstarter attempting to show your market dominance.
Yes, that chart gave me some serious data dissonance too.
I don’t understand… aren’t you the author of this article?
I wrote the article, but I didn’t do the charts. They were sourced from the CB Insights report I was writing about as is noted in the images.
Nicholas,
Anand from CB Insights here. Thanks for keeping us honest as you’re totally right that the chart’s scale was off. This wasn’t Stacey’s fault but was ours.
You’ll see a more appropriate scale on the chart which we published here after the pre-release report went out to Stacey and other journalists – https://www.cbinsights.com/blog/crowdfunded-venture-capital-hardware/
Thanks for the comment and for reading.
Best,
Anand
Just in case the threading didn’t work, I responded to your comment below. Just fyi.
I want to start a campaign to make “hand-cranked tabletop gyrogenerators” anyone interested? Email me at: driverguy7@gmail.com