This questions has been asked a few times on KickstarterForum.org and I wanted to take the time to address it in a blog post. If you are a non-US citizen or not a resident of the United States, can you launch a Kickstarter campaign?
The short answer is yes. You can create a project if you are in the US, UK, Canada, Australia, New Zealand, the Netherlands, Denmark, Ireland, Norway and Sweden (as of 11/5/2014). You must also comply with these requirements. I’ve included a few of them below.
For US Project creation:
– You are 18 years of age or older.
– You are a permanent US resident with a Social Security Number (or EIN).
– You have a US address, US bank account, and US state-issued ID (driver’s license).
– You have a major credit or debit card.
For International Project Creation (See details here):
– You are 18 years of age or older.
– You are a permanent ____ resident either creating a project in your own name or on behalf of a legal entity with a Business number.
– You have a ___ address, ___ bank account, and government-issued ID (driver’s license or passport).
– You have a major credit or debit card.
“Parents and teachers can launch projects in collaboration with children under 18 only if the adult registers for the Kickstarter and payments accounts and is in charge of running the project itself.”
How do you create a Kickstarter if you are not in one of these areas?
Let’s say that you are not a resident of one of the above countries. Can you create a project on Kickstarter? Yes, but it might be a little difficult. Let me explain. None of the information below constitutes legal or tax advice. I recommend consulting an attorney and tax accountant before proceeding.
Step 1: Find a Partner
You must find a partner from an approved country that you feel comfortable including on your project team. They must meet the country’s Kickstarter requirements. This partner could take the form of a friend, a temporary arrangement, or a long-term business partner.
If your partner is going to be a temporary member of your team or a friend, I would highly recommend walking them through the possible negative implications of helping out your company. What are the possible tax consequences? What legal challenges could arise? What parts of the process are you willing to help them out with should difficulties arise?
Being clear about the upside and downside with a temporary team member, ideally in written form, will help avoid confusion later down the road. You should also be hyper-transparent regarding roles, responsibilities, and rights/ownership.
If you are seeking more of a long-term business partner, keep in mind that individuals can lose interest in projects over time or simply pursue new endeavors. If that partner owns a big chunk of equity in the company, but is not contributing, then you are effectively in the marketplace fighting with one hand tied behind your back.
I’d recommend setting up a vesting schedule for all founders, along with a vesting cliff. For more information about vested equity, check out this article.
Step 2: Set Up a Legal Entity (Company) and Bank Account
Whether it’s an LLC or C Corporation, it’s crucial that you set up some kind of company that is separate from your US partner. First of all, this will give your team legal protection should a backer decide to sue you in the future because they are unhappy or you are unable to deliver the full product you promised. Second, it will help keep your personal and business taxes separate. Don’t forget to et an EIN number for your new company.
It’s also vital that you establish a separate business bank account for your company. This will help establish your separate entity and make income, expense, and tax records easier. You can also apply for a debt/credit card for your account.
As Kickstarter becomes more popular, accusations of fraud and mismanaged crowdfunding campaigns are rising. We’ve even published articles for backers on how to avoid low-quality and fraudulent projects. Having a separate entity and bank account for your company/project will give you more peace of mind later down the road.
Step 3: Set Up Your Kickstarter
After you have your US or partner from the country in which you wish to launch from and have set up your company/bank account, you can now create an amazon payments account and register as a Kickstarter project creator.
At this point in time, I recommend reading my ebook, “How to Succeed on Kickstarter” and going through our posts on lessons from other creators and how to get PR for your project.
Further Reading
If you’d like to learn about Kickstarter alternatives, check out this recent post. I also think this article written by Xenonauts, who raised $150k+ on Kickstarter is helpful for learning more about how to set up a project if you are not a US citizen. Finally, I recommend this one written by Roby Ward, who ran the Opena – iPhone Bottle Opener Case project, which raised $28k+.
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