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July 7, 2014
By Todd Allen
Kickstarter is something like a cross between a PBS pledge drive and advanced sales.

Once I’d made up my mind I was going to do a Kickstarter campaign, the first thing I needed to do was figure out how the math was going to work. Depending on exactly what you have to offer, Kickstarter is something like a cross between a PBS pledge drive and advanced sales. That meant I needed to figure out:

  • How much money I needed to green light this project
  • What I could offer for rewards
  • How much those rewards were going to cost me to produce
  • What I could charge for those rewards

The Basics

As far as costs go, 10% of the pledge money goes to Kickstarter and Amazon (5% to Kickstarter and around 5% going to Amazon Payments, which actually runs the transactions. The actual figure varies from 3-5% per transaction, but you need to use 5% when you do your math). Plus, if you don’t fulfill the project in the same fiscal year you run the Kickstarter, you’re paying taxes on the whole amount, instead of deducting out your printing and shipping costs. That’s somewhere between a really bad thing and a catastrophic error, so just keep that in mind while planning. I sure wouldn’t be having a Kickstarter ending in December if it was going to take me 3 months to ship the rewards. But that’s just me.

What could I offer for rewards? Copies of my book, of course. An e-book, a paperback and a hardcover. As is the custom in crowdfunding, it’s normal to offer autographed copies for an added fee. It’s known to have an acknowledgement section for high pledgers. These are all things I can do—and are also related to the eventual retail price.

"For a campaign like this, it’s best to use worst case scenario planning and try to make sure any surprises are happy ones."
An e-book doesn’t really have distribution costs associated with it. Print books do. Not just the printing, either. With a print book, you’re looking at:

  • Cost to print
  • Cost to ship from the printer to you
  • Cost to ship from you to whoever was pledging
  • Shipping materials (labels, envelopes, etc.)

Now, at this point, if you’re just doing a “simple” prose book: black and white interior/no interior color, you have a little advantage. You can get estimates really easily by pricing it out at a POD (Print On Demand Service). As I said in the last column, I’ve always used Lightning Source for my POD. That means all I need to do is go over to their website and they’ll tell me the cost, weight and shipping from them to me. Then I can go over to the various shipping websites and figure out the shipping costs from me to the prospective customer. Easy as pie. I would assume you can do the same thing with Amazon’s CreateSpace or Lulu, if you so desire. To each their own.

I’m not going to bore you with the full calculations on that, past that I had to make a guess on the page count. I guessed 200, and used a 6”x9” book to calculate weight. This gave me a little wiggle room, as if the page count is a little over I can jump up a size and get the page count (and shipping weight) down a little bit.

If I price this out as a single copy, that’s my worst case scenario. The more copies sold, the better volume discounts. If 1000 copies are ordered, could even go to less expensive offset printing. But for a campaign like this it’s best to use worst case scenario planning and trying to make sure any surprises are happy ones.

Beware Shipping Costs!

The thing you really need to watch out for here: shipping is much more expensive than it used to be. Even shipping a 1 lb package from Iowa to San Francisco via UPS costs $10.32. I almost fell out of my chair when I saw that. Although there is a small business discount, I don’t plan on doing regular shipments and I have no idea what my volume is going to be ahead of time.

Fortunately, I’m putting out a book. Presumably, you are, too. And that is what Media Mail is for. I’m looking at $2.69 to ship a paperback book. If I’m shipping 250+ print copies, there’s a possibility I can get a bulk shipping discount. Media Mail is perfect for books, magazines and the like. It’s not allowed for video games and gadgets, so we book people have a leg up on cost control for shipping. Yes, you’re liable to lose a few in the mail, but the price difference makes up for it.

So, I’ve got costs at this point. It’s time to price things out and see what I’m dealing with to set up the levels for the campaign:

  • “You just want to support the project” – 1. Some people just like to throw a buck or two at an interesting project with no expectation of getting a reward. You need to leave a slot open for that. Because I have a sense of humor, I limited this reward to 1,000,000 people. I really hope this reward is sold out, but I’m not holding my breath.
  • e-book –$9. Why? I’ll get $8.10 back using Kickstarter. Using Kindle/Nook/iBooks there’s a 70/30 split, which would be $7 if I priced it at $9.99 as I plan to do. Plus, it’s a whole lot easier for me to do fulfillment with an e-book. All I need to do is email a download code.
  • Paperback - $20. Looking at the non-fiction book of a similar nature, I was seeing prices anywhere from $18-$23, depending mostly on how recent the release was. The newer ones were higher. One rule of thumb for e-books is half the price of the print edition, so it fits that way, too. Running the numbers, I actually make less money on the paperback through Kickstarter than I do running it as a short discount, academic title through Lightning Source. Depending on how things break for bulk purchasing, I’m not going to be pulling even with my normal method on a per unit basis until somewhere in the 250-500 copy range. It is what it is, but that’s filed away in the back of my head.
  • Paperback, signed - $25. I’ve seen anything from $5 to $10 for autographing the book. I went conservative here. I’m just not that famous.
  • 3-Pack for Retailers and Academics - $36. Kickstarter is a little skittish on bulk orders. You can only sell up to 10 copies of an item and they don’t like to see “discounts.” So I didn’t use the word discounts and I figure most people in retail can figure out it’s a
  • 40% discount by looking at the pricing
  • Hardcover, signed - $50. I had a quandary on the hardcover, as with POD, hardcovers are a lot more expensive and you end up making about the same amount of money as the paperback with a normal markup. In the end, I threw this quandary to my advisors and it was suggested that I should emphasize it was a Kickstarter-only limited edition, charge $50 and as a limited edition it should come signed. Done.
  • 5-Pack for Retailers and Academics - $60. See above.
  • Patron’s name on an acknowledgements page + signed HC - $75. You see differing amounts to have the sponsorship name in a book. Again, I’m not that famous, so $25 on top of the HC seems enough. This is something for people who want to feel part of the project or feel strongly about backing it.
  • 10-Pack for Retailers and Academics - $120. See above.

The big money in Kickstarter campaigns comes from big ticket, one of a kind items, such as original art or speaking engagements. I’m not an artist and don’t see a clear demand for personal appearances. I’m just writing a book. This is going to be a fairly basic campaign in terms of rewards, although perhaps something more exotic will occur to me mid-campaign.

With all this in mind, what do I think is a realistic expectation for how many copies will be ordered?

This is the third edition of the book. The second edition came out in 2007 I’ve sold around 1500 copies of the second edition

With the higher profile for webcomics and my writing now I think I can move at least 250 copies in a Kickstarter,  but my goal is 1000-1500 copies. The overall market for this is probably 5K+, but it isn’t clear how many of those people will be reached by Kickstarter and if I need to reach them after I’ve shipped the Kickstarter rewards and put this in the distribution system, so be it. With books, you have a life after Kickstarter. Looking at the comics projects, you see the number of people pledging starting to drop off rather quickly at 3000 people, so the best case scenario for this is probably 3000 copies.

Realistically? 250-1000 copies seems doable.

But what are my actual costs for doing a Kickstarter? $150 to set up a paperback and a hardcover book at Lightning Source. Maybe I upgrade some software and maybe I don’t. All the shipping costs are budgeted into the books.

Don’t Get Greedy

I chose to set the goal at $500.


Depending on which items get pledged, that should leave me with $250-300 after costs. I’ve got my file setup money. I’ve got a $100-$150 to deal with minor expenses that might come up. My costs are covered. There are also some less tangible benefits:

  • Instant momentum. If you talk to people who do a lot of Kickstarters, they’ll tell you that it’s just a painful fight until your project gets momentum. And by momentum, they mean that somebody can look at the project and think “yes, this will probably get funded” when they look at what’s been pledged and how much time is left. I don’t need extra stress.
  • I’m not getting greedy. You want to have a failed project? Ask for a larger amount than you need. We’ve all seen a project that looked like it needed $10K asking for $50K, getting $10K pledged and then not getting to keep what was pledged. I’m not going to be that guy.
  • People also like to pledge money for projects that have made their goal. At that point, they’re not taking a flier on a project, they’re making a pre-order. I sincerely hope to have a healthy pre-order business.

I really can’t emphasize the value of not getting greedy enough. If I was doing a full color book, I’d need to have a print run of at least 2000 copies and base my goal on that. I’m not working in color, so I don’t need to hang a lofty goal on my audience, so $500 it is. If my worst case scenario is 250 copies, $500 shouldn’t be a problem and if I’m being way too ambitious, I still should be alright and can go back after the market post-Kickstarter.

Now, if I had more expenses, I’d looking at the dollar value of my worst case scenario in e-books pledges ($2250) and worst case scenario in softcover pledges ($5000) and hoping the costs lay somewhere in the $2250-$5000 range. The higher above $2250 those expenses were, the more risk I’d have of the campaign failing. For Pete’s sake, don’t ask for $50K unless you have reason to believe you can get it.

Next: The Adventure of Actually Entering This All into the Kickstarter Site

[Todd Allen has spent more than 15 years around digital publishing and comics. He’s covered the business side of comics for Publishers Weekly, Chicago Tribune and Comic Book Resources. As a contributing editor to he’s been nominated for an Eisner Award and named to TIME magazine’s 25 Best Blogs of 2012 list.]