Nearly 1 in 10 Kickstarter Projects Fails to Deliver Rewards

The crowdfunding platform commissioned a University of Pennsylvania professor to do an analysis of the fulfillment rates of funded campaigns on the platform.

learn more about Catherine Clifford

By Catherine Clifford


Opinions expressed by Entrepreneur contributors are their own.

Crowdfunding is inherently risky for investors. But just how risky?

As a campaign backer on Kickstarter, you are looking at about a one in 10 chance you will not get the reward you are promised when you invest in a project. That's according to an independent study.

The Brooklyn, N.Y.-based crowdfunding platform collaborated with the esteemed Wharton School of Business at the University of Pennsylvania to complete the study. And according to an analysis of 47,188 randomly selected backers of successfully funded projects 9 percent of the time a Kickstarter campaign has reached its funding goal, the project creators did not deliver the reward that was promised.

If the campaign fails to fulfill reward promises, then only about 13 percent of campaign backers were refunded their money.

This is the first time Kickstarter has published such rates disclosing the failure of campaign backers to deliver rewards.

Related: Why This $34 Billion Company Is Dipping a Toe Into Crowdfunding

The professor who authored the study had a pretty forgiving perspective on the fulfillment failure rate. "Ultimately, there does not seem to be a systematic problem associated with failure (or fraud) on Kickstarter, and the vast majority of projects do seem to deliver," says Professor Ethan Mollick, who has a focus on innovation and entrepreneurship, in Kickstarter's statement announcing the results of the research.

Unsurprisingly, Kickstarter also says the fulfillment failure rate found by the study is appropriate.

"Is a 9 percent failure rate reasonable for a community of people trying to bring creative projects to life? We think so, but we also understand that the risk of failure may deter some people from participating," the company says in the report. The goal of the report for Kickstarter is transparency. "We want everyone to understand exactly how Kickstarter works — that it's not a store, and that amid creativity and innovation there is risk and failure."

The size of the project has a slight impact on whether or not backers will receive their awards, according to the research, which Professor Mollick also published. Among projects that raised less than $1,000, 13 percent failed to deliver rewards to the backers.

Related: How Much Does a Person Typically Donate to a Kickstarter Campaign? Here's Your Answer.

The category of campaign also had a small impact on fulfillment success rates. Film, technology and food projects are more risky than music projects, according to the white paper. Those differences, however, could be due to the level in complexity associated with each project category. "It may be that film or technology products are aiming for more breakthrough products or are offering more complicated rewards (a completed movie or gadget, rather than a band t-shirt), and are thus at a higher risk of failure," says Mollick.

Perhaps most noteworthy for the industry as a whole, however, was the non-finding that the demographics of the campaign founder had no bearing on the relative success of the campaign to deliver rewards.

"There was no significant difference in failure rates between women and men, between highly educated and less educated creators, between teams and individual projects, between single or partnered creators, or between creators with children and those without," wrote Mollick in his paper analyzing the results.

The data that Kickstarter and Mollick jointly released today is entirely reflective of those campaigns that have already reached their funding goal. The crowdfunding platform has long been transparent about what percentage of campaigns launch and do not ever reach their goals. Currently, almost 37 percent of projects that launch on Kickstarter do not reach their goal, and therefore funds are not dispersed.

Related: The Inventors of This Travel Jacket Set Out to Raise $20,000 With Crowdfunding and Ended Up Raising More Than $10 Million. Here's What Happened Next.
Catherine Clifford

Senior Entrepreneurship Writer at CNBC

Catherine Clifford is senior entrepreneurship writer at CNBC. She was formerly a senior writer at, the small business reporter at CNNMoney and an assistant in the New York bureau for CNN. Clifford attended Columbia University where she earned a bachelor's degree. She lives in Brooklyn, N.Y. You can follow her on Twitter at @CatClifford.

Related Topics

Editor's Pick

Everyone Wants to Get Close to Their Favorite Artist. Here's the Technology Making It a Reality — But Better.
The Highest-Paid, Highest-Profile People in Every Field Know This Communication Strategy
After Early Rejection From Publishers, This Author Self-Published Her Book and Sold More Than 500,000 Copies. Here's How She Did It.
Having Trouble Speaking Up in Meetings? Try This Strategy.
He Names Brands for Amazon, Meta and Forever 21, and Says This Is the Big Blank Space in the Naming Game
Business News

These Are the Most and Least Affordable Places to Retire in The U.S.

The Northeast and West Coast are the least affordable, while areas in the Mountain State region tend to be ideal for retirees on a budget.


6 Secret Tools for Flying First Class (Without Paying Full Price)

It's time to reimagine upgrading. Here's how to fly first class on every flight, business or personal.


8 Things I Discovered While Working With Affluent Clients in New York City

After a decade working with the 1%, I learned that they have common traits.

Thought Leaders

The Collapse of Credit Suisse: A Cautionary Tale of Resistance to Hybrid Work

This cautionary tale serves as a reminder for business leaders to adapt to the changing world of work and prioritize their workforce's needs and preferences.

Business News

I Live on a Cruise Ship for Half of the Year. Look Inside My 336-Square-Foot Cabin with Wraparound Balcony.

I live on a cruise ship with my husband, who works on it, for six months out of the year. Life at "home" can be tight. Here's what it's really like living on a cruise ship.

Starting a Business

A Founder Who Bootstrapped Her Jewelry Business with Just $1,000 Now Sees 7-Figure Revenue Because She Knew Something About Her Customers Nobody Else Did

Meg Strachan, founder and CEO of lab-grown jewelry company Dorsey, personally packed and shipped every order until she hit $1 million in sales.