Launching a crowdfunding campaign is not for the faint-hearted. You need the relentless fundraising skills of National Public Radio, the know-how of product design and manufacture, and some serious marketing chops--and that's just on day one.
I wanted to learn the ropes about the new economy first hand, so I created an Indiegogo campaign to accompany my invention of Faux.glass - a light up toy with a good backstory that's supposed to be a fun, inexpensive alternative to the Google Glass phenomena.
What I learned could fill volumes but I'll distill. You launch a product on Indiegogo (or Kickstarter or any other crowdfunding site) to raise money to cover the costs of launching your product and to build momentum for your yet unborn product. You create a system of perks or rewards for your backers. In my case, they were getting the first products off the assembly line in China and their names and photos on our Wall of Faux. Sounds pretty simple? Create a concept, create a campaign and you're off, right?
There is no FUN in crowdfunding and here's why:
1. Your friends and family will come to hate you. The first place you look for financial support is to anyone you've ever known. Half of my week one was spent explaining to my mom, brothers, sister and kids about why they had to pre-purchase my toy. Next, I bugged my friends.
2. Launching the campaign requires skills you undoubtedly won't have. There's the legal jargon of what constitutes a perk.
3. Do the math. Indiegogo doesn't have a shipping calculator because there's nothing to ship since the product doesn't exist. They take X percent of the earnings of the campaign. The credit card companies take another X percent. And shipping takes a big chunk since your buyers can be from Kuala Lumpur as easily as Brooklyn. Basically more than 10% of my fundraising is gone before I start.
4. Site creation. Indiegogo and the others give you some basic tools to build your campaign and they're actually quite powerful. They prompt you to add music, video, photos, etc. These get you to thinking that you probably should add them or they wouldn't have asked. Next thing you know you're making movies like this one, which took a week.
5. The crowdfunding ecosystem rears its head. On my first day I was inundated with emails, but they weren't for new orders of my toy. They were pitching ways to make my campaign more effective. For $5 they'd find 1,000 more people for me to talk to. I'll never know which of them was legit, but I felt like Nigerian prince scam redux.
6. The work's never done. You launch the campaign and breathe, but it's just for a moment. Keeping engaged with your new followers, waging a press campaign, posting the press campaign - it's not a part time job.
A year ago I thought that crowdfunding would totally revamp the economic landscape. That we'd all just let our imaginations run wild and get our friends, family and the webosphere to back us. Humbled, I now find out that more than half of crowdfunded products do not make their monetary goal, and that most of those are first time projects.
Swift risers like Oculus Rift and Misfit Shine don't help me any either. Indiegogo gives me sixty days or they take a larger percentage of the pie than I bargained for.
Well, I've learned through experience. Now, how about some glasses to wear to your holiday parties?
Robin Raskin is founder of Living in Digital Times (LIDT), a team of technophiles who bring together top experts and the latest innovations that intersect lifestyle and technology. LIDT produces conferences and expos at CES and throughout the year focusing on how technology enhances every aspect of our lives through the eyes of today's digital consumer.