Kevin Kelly wrote a wonderful essay in 2008 called "1,000 True Fans." It clearly was one of the inspirations for Kickstarter, which launched just over a year after the essay appeared. Read the whole essay for the richness of Kelly's thesis, but the nut of it is that with 1,000 true fans of your work as a creator, you can probably make a living from that work.
Kelly notes that the number isn't exact. Bloggers in 2008 might need substantially more fans because the average financial contribution is relatively low, while people in other fields might need 500. Kickstarter adds precision to that: rather than focusing on making a living, rewards-based crowdfunding lets people with any number of true fans potentially translate those supporters into funders for projects that have a financial target in line with that quantity of dedicated supporters.
My contention about Kickstarter since I started writing about it in 2010 is that it allows a single creator or group to decide on funding levels for projects based on their understanding of how many true fans they have. A dance troupe that needs $1,500 to rent a space to stage a production and has a mailing list of 500 people could get 50 people to contribute an average of $30 to make it happen. The much-cited Amanda Palmer project raised $1.2 million for a new album and tour, but only from 25,000 or so backers, 11,000 of whom gave $1 or $5. My friend Matt Bors had a quite successful campaign to fund a book (which he just delivered on schedule) with a total of 725 backers.
Most previous strategies for donor-based fundraising didn't necessarily make it hard to reach those true fans, but it was still difficult to create a project in a common framework around which fans could easily rally. My imaginary dancers could write in an email missive, "Go to our donation page, enter your credit card information, donate what you can, we're trying to raise $1,500." This putative troupe could put a thermometer towards the goal on the home page, and so forth. The dancers' webmaster would have to invent or integrate all the parts to make it work, too.
What Kickstarter provides is a consistent platform that is designed around the notion of a goal that must be achieved to bring something into existence. The company trains people to see its design and think about a project-oriented outcome: when this is funded — if this is funded — the results will be this thing that is highly specific and doesn't currently exist.
Using Amazon Payments means backers don't enter credit-card information, as most people who would contribute in this fashion already have Amazon accounts. Providing a sense of urgency (a countdown), consistency (others have done this before), and community (here's the people you know who backed this) all pull together to make an experience for the backer.
When non-profits have an auction component to a fundraiser, they typically hire professionals to handle bidding. The fee can be 10% to 15%. This is quite reasonable because they know how to get people to reach deep, deep, deep into their pockets. Good auctioneers provide a professional experience that is familiar to patrons from previous auctions or television. Substantially more than the fee's cost to the non-profit is raised because they turned to people who know how to set the right expectations.
It's true one can mimic this, too. App.net decided to crowdfund their microblogging and messaging infrastructure network, but built their own integrated system (it worked). For TidBITS, an Apple news and analysis site that I have worked with for years, we created a membership system that had many elements of crowdfunding, and which fell outside Kickstarter's rules, which don't allow subscribers or recurring billing. (You can hear me discuss this with Adam and Tonya Engst, the owners of TidBITS and the Take Control Books line of books, in Episode #8.)
Kickstarter's place in this ecosystem is to provide a flat-fee approach that allows people with any scale of true fans to run a crowdfunding campaign without having to build the project pieces themselves. This removal of friction thus allows 10, 100, 10,000, or 100,000 true fans to support projects from a few hundred dollars to several million dollars.