New Market for Subscription Revenue: Crowdfunding Enthusiasts

As I’ve said before, there are a few tried-and-true niches for subscription content: business and professional information, financial news, sporting fans, and enthusiasts. The last leaves the

As I’ve said before, there are a few tried-and-true niches for subscription content: business and professional information, financial news, sporting fans, and enthusiasts. The last leaves the most room for exploration and new launches in the subscription model as almost any past-time, hobby or lifestyle can lend itself to an enthusiast crowd. After all, even companies can have enthusiasts, viz-a-viz Apple.But one industry I didn’t see adopting a subscription model despite the enthusiasm it generates is crowdfunding. And yet, Indiegogo announced this week that it will allow “fund a project forever” with subscription crowdfunding.Putting aside the wisdom of such funding techniques from the audience perspective (Indiegogo tends to have more lax rules when it comes to crowdfunding than its main competitor Kickstarter, accepting money even if a project doesn’t meet its funding goal), Forever Funding, as it’s being called, is actually quite financially savvy for the company. While Indiegogo didn’t announce if and what percentage a cut it would be taking, it’s expected to take a 4% cut from the recurring revenue.However, with Indiegogo’s lax rules, the company could run into more trouble than subscription billing is worth since there is such a thing as subscription liability. If funders don’t feel like they’re getting their money’s worth for their funding efforts, they can hold Indiegogo and the project accountable. Because many projects offer token gifts as a thank-you for funding, this may be a liability.At the same time, numerous nonprofits have set up recurring donation models that have worked. So it all depends on whether crowdfunding enthusiasts see themselves as micro-philanthropists or customers.

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