One of the scariest things about launching a crowdfunding campaign is knowing whether or not you have accounted for all the money you have to spend vs. what you collect. The internet is littered with crowdfunding horror stories, where creators lost all their profits – or worse, had to dig into personal finances – because of unforeseen expenses.
Well, I’ve got some good news for you. You can avoid such a situation by planning out your campaign using Google Sheets – and updating it live as your campaign progresses. I’ve used this technique on both my successful crowdfunding campaigns (and I made a profit on both), and I’m going to show you how to do it for yourself.
Fail to Plan? Then Plan to Fail
The title is a cliche, but it’s true. You want to plan for ALL your campaign expenses BEFORE you launch. And then you want to match that up to your goal to see if what you are planning on doing is really something viable that will actually turn a profit.
So what are the key expenses for which you have to account?
The cost of your product
In my case it is graphic novels. So I need to know the printing costs (at various price break levels). But it’s not just printing the book! It’s proof copies, any other related printer expenses (pre-press, for example, if you need it) and very importantly – shipping the books to YOU. (You have to get them before you can send them out!)
When you read failure stories, it’s often because of this. People often just leave it out entirely! Not only do you have to account for domestic shipping, you have to account for international should you be shipping abroad. And that can get expensive.
And something else here is important. You want to know almost exactly what it costs to ship your item BEFORE you order it! You need that number. How do you do it without the thing in your hand? Make a mockup, or find something similar. For my books, I found a same-sized book, got the box I would use, and brought it to the post office. I had them calculate domestic shipping (media mail) and international (first class).
And make sure you are accounting for multiple shipments if you are making them. (I suggest you try NOT to do this). For both Marooned and Rock & Tin, everything that could be gotten from the campaign could fit in the one box. I did not have to make any extra shipments to incur extra costs.
Extras and Fees
Stickers, buttons, bookmarks, t-shirts, whatever it is – find out the cost to buy it AND the cost to ship it to YOU (just like the books.)
You’ll pay a % fee for the crowdfunding platform plus a fee for credit card processing. Make sure you look up this information on the platform of your choice.
Setting up the Google Sheet
With all this information at hand, you want to start building your spreadsheet. We’re not going to do anything difficult here, so don’t worry. First, you create a new spreadsheet by going into Google Docs and creating a new Sheet. (If it’s defaulted to docs, you can go to the menu in the upper left corner of the browser).
Next, we create a section up top for expenses. I like using some color formatting to make things easier to read. You can copy what I did, or you can roll your own.
My format is to use 6 columns (the one to the left of notes is just for readability). On each line, enter an expense item. For things that change over the course of the campaign, make use of the quantity column to update things on the fly. For things that won’t – like my button or sticker order, just make the quantity 1 and put in the total amount. The notes field is optional but can help you remember things.
Automatically calculating the cost
We make our sheet automatic by using the SUM functionality. As long as you know basic math, you can use this – it’s not hard 🙂 Examine the image below:
You can create a SUM function by clicking the button highlighted to the right (with the tooltip “Functions”). But you can also just select a cell, and type “=SUM(” to get started. If you look at the SUM I have set up to calculate the cost of my softcover books, you can see how simple it is. The numbers inside the parenthesis are cell numbers of the spreadsheet. “B3” means column B, row 3. (You can see row numbers in the image, apologies!)
So I am multiplying (since the asterisk means multiply) cell B3 by C3 – in other words, 46 books at $6.69 equals $307.74. And the great thing about this is that if you copy cell D3 now and paste it in cell D4 (the next row) it will copy the formula! Now you can keep adding quantity and cost for your rows that way until you are done. And when you change those numbers on the fly, they will be recalculated.
I did the same thing for campaign fees in another section below the first, until I have this:
And you can see the row numbers here as well. Now the next trick is to add all these expenses together.
Showing total expenses
Now that we entered all this information, we want a full picture of the cost.
I’ve created three more rows. And we’re going to use three more SUMs. For the total base expenses, I wanted to add up the “Cost” column for all those rows. That’s easy to do using a simple colon. So in the example above, =SUM(D3:D11) means “add the total of rows 3-11 in column D. That gives me that first total (or “Toal!).
For the total fees, I did the same thing for the bottom section – just added D14:D15. Then to get my Total Project Expenses, I added the two total cells together =SUM(D18+D19). Now I have the total money that I am responsible for. (Note, some expenses are estimated, like credit card fees, so be aware of that.)
Add in the good stuff!
Now that we’re done with the bad news, let’s put in the good news. We make a row above expenses that is for funds raised. If you are still in the planning stage, this is funds projected. Before you jump into this, you definitely want to have some sort of an idea of how much you expect to sell. You should not be going into this without an established audience.
In my case, I knew how much readership I had (and how many Patrons I have on Patreon.com). I did a quick poll to see how many people were interested in buying a book – with the full awareness that polls are not reliable! People who will buy will not answer, and people who say they will buy end up not buying. But still, it’s not a bad idea to get some kind of ballpark starting data to use with all your other insights.
I took that number, what I knew about my readers, what I knew about people who bought things from me before and people I was currently talking to who expressed interest in buying the new book. I came up with a conservative number of buyers, and figured out how many books I’d need for that. This is how I crafted my funding goal.
My projection actually was pretty accurate, if a bit low – which is good because I easily met my goals for both campaigns. So with that row placed, we now have this (remember, this amount is manually entered):
Calculating the live situation
You can probably tell from how we have these rows laid out that we’re going to logically subtract the expenses from the funds raised (or projected if you are just starting) to see how things stand.
So we’ll add one more row called “Gain/Loss.” We’ll subtract the total expenses from the funds raised/projected using the simple =SUM(D17-D20). Note, with all these sums, your numbers will likely be something different, but the examples should show you what to do.
Ta-da! Now you have a LIVE view into the current state of your campaign. Each time you change a cell, all the values will update. So the complete sheet looks like this (as of halfway through my campaign):
And I can see that I am currently $840 in the green. Now I can adjust the funds raised each day, add to the number of books to print, adjust the shipping (I like to keep a running total of each shipping method as I go) and so forth.
If another expense comes up, you can add a row in. If it’s in between your SUM range (Like D3:D11) then the sheet should just automatically update.
The only thing missing from here would be taxes, but I feel like that really doesn’t fit in.
Ideally, you make this spreadsheet BEFORE you launch. Estimate what you think you can realistically raise (even if it’s only an educated guess). Then you can put your funding goal in as that number to start, and you’ll see if you need to adjust.
As your campaign goes on and you meet your goal, this spreadsheet will be an invaluable tool to help you decide how to implement stretch goals or add-ons, and how those costs will affect your bottom line.
Now go forth and conquer!