How do we gauge the growth potential of the Crowdfunding Industry?
Many firms have gone to extraordinary lengths to research and report on the past, current and future growth of the young crowdfunding industry(The best we’ve seen comes from CrowdSourcing.org which published through their sister company Massolutions) . Having neither the time or the resources to survey and develop an in-depth research report, we have utilized some readily available internet tools to prove our thesis that the crowdfunding phenomenon is in its infancy and on a trajectory of incredible, sustainable growth.
I liken the research we have done to the technical analysis of stocks vs the fundamental analysis of other industry watchers, each have there benefits but technical data is much easier (and cheaper) to come-by and in my experience has better predictive powers.
Our analysis is based on a comparison of the leading crowdfunding sites (Kickstarter and Indiegogo reviewed here) and the last great consumer internet explosion involving market leaders Groupon and LivingSocial. Keep in mind for the purposes of this post we have ignored the largest potential area of growth, equity crowdfunding, sticking with the donation/reward based platforms mentioned above.
We used three data sets to review the growth we foresee in Crowdfunding:
1. Google Searches for the Market Leaders in each industry
2. Alexa ranking comparisons of the 4 Market Leaders
3. Revenue (total billings) of Groupon vs project funds raised by Kickstarter

Our first data points are brought to us by Google Trends. We have created two comparison charts, once shows Google searches for “Kickstarter” vs searches for “Groupon”. The second chart shows Google searches for “Indiegogo” vs searches for “LivingSocial”. We felt that comparing the clear number one (currently) crowdfunding platform and the leader in social, group shopping Groupon would be the best way to show our data.

 The second chart presented below compared Google searches for “Indiegogo” vs “LivingSocial”

Remember both Indiegogo and LivingSocial are currently distant seconds to their market leading competitors. What amazed me about both these charts is that with all the talk of what a current disaster both Groupon and LivingSocial vs all the positive press (generally) crowdfunding has received over the last year, the interest based by Google Searches clearly shows how much room the crowdfunding leaders have to run.

Next we looked at Alexa ranking, again comparing the market leaders vs each other and a comparison of the number two players in each industry. Although headway is clearly being made, particularly by Indiegogo vs LivingSocial, if you look at the peaks of the “group buying” platforms you will get a good idea of how much room crowdfunding has to run.

In the next chart you will find that Indiegogo has passed LivingSocial in traffic but to reiterate for the point of this analysis, notice where LivingSocial peeked.

You can look at both keyword search data and Alexa ranking (wrongly) saying  “so what” but what if we look at how much revenue Groupon drives vs crowdfunding leader Kickstarter. We are aware that Groupon has changed its accounting practices and no longer accounts for sales in this way, all we are looking at is the amount of “product” Groupon’s website has moved as compared to how much money Kickstarter projects have raised.
Consider that Groupon is a professional marketing organization and they do run an “affiliate” program BUT and this is a big BUT Kickstarter has each individual campaign creator working to market their individual projects. That fact alone gets us pretty excited about the “revenue” prospects and growth ahead for Kickstarter and the Crowdfunding Industry.

Just to clarify, these number are in MILLIONS. Meaning that Groupon sold $1,343,000,000 dollars worth of product and services in the 3rd quarter of 2013. They are expected to do over $1.6 BILLION in billings (or revenue under old accounting) in the 4th quarter of 2013. I’m not a fan of Groupon as a business but that is a huge number.
Now lets see where Kickstarter stands, the paragraph below comes from TechCrunch, the article can be found here

 Kickstarter has raised a TOTAL of $612 million dollars since its inception. Not in a quarter, not in a year, since the website was started in 2011. Think they have some room to grow?
These data points lead us to LAUGH at articles calling crowdfunding a bubble. That’s not to say it might not get there and surely there will be bumps in the road but looking at the big picture, there is little doubt that donation/reward crowdfunding has an incredible run ahead.
We would certainly enjoy feedback and your thoughts on our where the crowdfunding industry is headed.
Post brought to you by Crowdfund911.com, Crowdfunding Project and Promotion Services, turning on 12/1/2013