Aug 31, 2016

Kickstarter Changes Which Singaporean Creators Need to Watch Out For

At long last, Kickstarter is to be launched in Asia on 1st September, with Singapore and Hong Kong being the first two countries to benefit. Singapore Kickstarter creators need not go through the complicated process of looking for a overseas helper, or deal with complex offshore tax issues anymore. However, there are some fine points for Singaporean creators which will be different from creators from other countries and here are 3 points to look out for:

Payment Processing Fee
The payment processing fee for Singapore creators is generally higher.

Singapore fees 
4% + $0.30 SGD (micropledging rates for under 10 SGD of 5% and $0.05 SGD) 

US fees
3% + $0.20 USD (micropledging rates for under 10 USD of 5% and $0.05 USD)

USD Denominated Pricing 
One of the key problems for international backers is that SGD is not a popular currency around the world and Kickstarter has a system which will reflect the USD equivalent amount for US based backers for your pledge tiers. However, it is always good to have an easy to read table for other currencies, in which you may foresee having strong interest in your project.

Minimal Pledge Amt
Most Kickstarter creators will have a $1 pledge tier for backers who want to further monitor the project before increasing their pledge amount or for kind donators who do not want any rewards but just want to contribute something to the project. The minimal pledge tier for Singaporean projects is $2 instead of $1. The reason behind this is because Kickstarter will automatically round-down the currency exchange to show the USD for the US backers and rounding 1 SGD down will be 0 USD which will not make sense when the US backers see this pledge tier.

There will no doubt be grumbles on the higher processing fee but the 1% extra fee, is a minor cost as compared to the old arrangement whereby creators have to bear double currency risks, potential higher tax regime, oversea bank transfer fee and a whole host of tricky problems which no creators will want to handle.

With the entry of Kickstarter into Singapore, there will be no doubt that there will be strong pressure on other similar reward based crowdfunding start-ups. In fact, the website for Crowdtivate has been taken down, along with all my history and records of my failed Wongamania: Classic crowdfunding campaign.  Meanwhile, Crowdo, a major Singapore reward based crowdfunding platform has pivoted into a equity crowdfunding platform to avoid competing with the entry of Kickstarter.
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