When my crowdfunding campaign failed, I was pretty devastated. I couldn’t figure out what went wrong — my Flipout Screwdriver had just won the Proto Labs Cool Idea! Award, had gotten tons of press coverage and people really liked the video (not to mention the product). Yet, I fell short, raising only $17,000 of the $50,000 goal I needed to move forward. I’ll admit, the product was priced a little high ($130 compared to most electric screwdrivers that go for $30 to $50 in stores), but I still couldn’t understand what went wrong. I had spent six weeks emailing every gadget magazine, tech blog and DIY forum I could find, but was somehow unable get my project into the coveted “Popular Products” category on Kickstarter — a section on the site that can seemingly make or break a product overnight. I thought it signaled the end of Flipout. Fortunately, it was just the beginning.
In addition to simply raising capital, there are a lot of bonuses to running a crowdfunding project that can actually benefit an inventor more in the long run. When the Kickstarter clock expired, I thought my project had failed, but really, it was the beginning of a crazy roller coaster ride that would result in a DRTV deal with Lowe’s — one of the largest big box retailers in the world. Regardless of the success or failure of a Kickstarter project, there’s a lot of good that can come from the campaign. It’s kind of like running a marathon; it takes months of training and then you run like you’ve never run before, but once you cross that finish line, it can be life-changing. Thus, my excitement crowdfunding.
Here are 11 reasons why every inventor and entrepreneur should consider a crowdfunding campaign:
ONE: VIDEO BRINGS PRODUCT TO LIFE
Showing a video of your product in action makes it seem so much more tangible and helps people understand what your product is and why they need it. What’s more, having a video of your product shows potential licensees how they can market your product to their customers. Plus, when you’re done with your campaign, you’ll have plenty of video to show at business meetings and trade shows.
TWO: BRAND AWARENESS
If you have a compelling product name or brand concept, Kickstarter is a great way to get your name into the market and build brand awareness. I was pretty surprised when I got the call that Lowe’s really liked Flipout and wanted to sell the product under that name. I was passionate about the design and Flipout brand, so it is amazing to see it in stores now.
THREE: TEST THE MARKET
Kickstarter is an inexpensive, low-risk way to test-market your product. It reveals a sample demographic of those interested in the product, gauges how much they’re willing to pay and shows what versions of your product they like the best. You can also make small changes to your Kickstarter page throughout the course of your campaign to test out different marketing messages and compare them against conversion rates. It helps you monitor the effectiveness of your copy and visual content.
FOUR: PRODUCT FEEDBACK
What better way to solicit real feedback about your product than to put it in a public forum for the world to see. This is especially true in the comments section of the blogs and magazine articles written about your product, since most online users aren’t necessarily worried about restraining their criticism. For me, it was hard to read some of the negative comments, but most were positive and extremely helpful in providing all types of constructive feedback. The bottom line: crowdfunding campaigns give you a chance to find out what’s most important to your customers and allows you to make any necessary changes before you release your product to the masses.
FIVE: COMMUNITY INVOLVEMENT
Generating community support behind your Kickstarter project can be an invaluable asset, both before, and during your campaign. While filming the Flipout video, I was overwhelmed by how excited people were to help out with the project. I asked several local businesses if they’d be interested in being involved, and before long, I had a car stereo installer, helicopter pilot, pro motocross rider and a sailboat rigger — all of whom were happy to try out the Flipout Tantrum while we filmed. Plus, we were able to do some really fun stuff, like send a guy to the top of a 40-foot sailboat mast with a screwdriver and a GoPro camera! Watch the video: http://bit.ly/kstrflipout
Participating in local events while your campaign is running is another great way to raise awareness for your project once the campaign starts. This will drive more traffic to your crowdfunding page, give local folks an opportunity to check out your prototypes, and maybe garner a few extra shares on social media in the process.
SIX: TELL YOUR STORY
People really connect with stories, and one of the greatest things about Kickstarter is that it allows you to tie your own story into your product, giving it a more personal feel. A back story puts a whole new perspective on a product. People love to hear how the inventor came up with the idea, how they built their first prototypes and what inspired them to keep pushing forward. It also gives people something to write about when they’re covering your product in magazines, blogs and social media.
SEVEN: PERFECT YOUR PITCH
If you’re an inventor or entrepreneur, nothing is more important than your pitch. A video is your pitch (accompanied by music, of course). It’s a chance for you to put your best foot forward and show the world what your product is, how it works and why they need it. A crowdfunding campaign forces you to put things in perspective and focus on showcasing your product in a way that your customers find most valuable. Everything from your video, page content, and even the emails you send, will give you an opportunity to fine-tune your message. Remember: clear, concise, compelling.
EIGHT: BUILD NEW CONTACTS
Crowdfunding has the potential to elevate your product to a whole new level by connecting you with high-level experts who most people don’t have access to. Within weeks of launching my project, I received a message from the president of one of the biggest names in power tools. He loved the product concept and wanted to know if I was interested in partnering. A week later, I received an email from an inventor of a successful product that had recently sold millions of units. He was located about an hour away from me, and invited me down to his office so he could see his prototype first-hand. Then, with a single, life-changing gesture, he slid a piece of paper across the table. It has the names and phone numbers of senior buyers at several well-known big box retailers, which eventually led to my first licensing deal.
NINE: NEW RULES AND REGULATIONS
Since crowdfunding really started to take off a few years ago, there have been significant changes made to the rules and regulations, which are benefiting inventors in unprecedented ways. IndieGogo just launched its “Forever Funding Pilot Program” that essentially allows creators to continue to accept donations, even after the project ends. This means you could have a potential never-ending revenue flow to keep pace with demand. Kickstarter just changed its rules to allow you to sell multiple quantities of hardware products, whereas before you were limited to one product at a time. It also reduced the frustration attached to the approval process by adding the LaunchNow option; the option lets you launch your product almost immediately instead of waiting for a Kickstarter agent to review your video (which can take FOREVER). Another really cool addition is the rise of equity-based crowdfunding, which gives backers the option of buying equity into your company — an investment that could pay off for them in the long run.
TEN: FAIL FAST, SUCCEED FASTER
Did you know that the most successful crowdfunding project of all time failed the first time it launched? Perhaps you’ve heard of the Coolest Cooler — the latest Kickstarter sensation that shattered records when it raised a more than $13.2 million! When the Coolest Cooler made its initial debut on Kickstarter, it failed to meet its funding goal, but that didn’t stop inventor Ryan Grepper from launching the Coolest for a second time, a move that would make Grepper one of the most successful inventors in crowdfunding history.
Another lesser-known fact is that crowdfunding sites can be a gateway to licensing. Big companies are cutting research and development funding, and are increasingly relying more on outside inventors for new product ideas. Forward-thinking companies have a watchful eye on crowdfunding sites as they look for their next big product. They want to see that a product has proven sales potential before they invest millions of dollars in bringing it to market. Sites like Kickstarter are the perfect way to prove there’s a market for your product.
Crowdfunding is a great way to introduce your invention to the world, test the market and get invaluable feedback. Whether or not your project succeeds or fails, crowdfunding could be the vehicle that propels your product to the next level.
By Joel Townsan, creator of the Flipout Screwdriver