Crowdfunding: HOW and WHY to launch your idea on Kickstarter
With 5 successful campaigns totalling over a $1 million, Kickstarter is part of our DNA.
We launched our first product The PowerPot on Kickstarter back in April of 2012, which led to the creation of our company, Power Practical. Since then we have used Kickstarter to launch each of our new products because:
Public reception is always a risk whenever launching any product. Crowdfunding helps you de-risk a product launch by validating your idea with the public before investing in inventory. To go on Kickstarter, all you need is a working prototype and a good story to tell. This means you get to test your market before investing the tens/hundreds of thousands of dollars in tooling and development costs that it takes to mass manufacture a product.
Additionally, if you are looking to raise investment funds for your business, a successful crowdfunding campaign can help immeasurably for three reasons.
- You have validated that the public will buy your product.
- It shows that you have a team that is capable of executing your idea.
- You have some revenue / working capital already, which will serve as the basis for your initial valuation.
Kickstarter.com is one of the top 500 most visited websites in the world, and has raised more than $2 billion from over 10 million people. Its reach goes beyond people just browsing the site, because it’s a hotbed for journalists looking for new stories. Everyday you see articles written on crowdfunding campaigns from dance to new tech published on small independent blogs to massive publications like Engadget or CNN.
3. Cash up front
When you launch of a crowdfunding project, you are in essence pre-selling your product with a promised delivery date. This means you get to collect the cash up front before investing in inventory, which is a must for a startup and extremely valuable for easing the cash-flow of an operating business. Don’t forget, crowdfunding is a non-dilutive interest free way to raise capital, so say goodbye to giving away a percentage of your company or going into debt and paying banks. Crowdfunding platforms like Kickstarter and Indiegogo make money by taking a percent of your raised funds (5–10% including CC processsing) but no equity and you own all of the intellectual property from your campaign.
1. Define your project/story/goal
Ask yourself why are you raising money and why should others help you? To successfully crowdfund you need to have a clear goal for yourself and a clear reward for those who support you. How does your product differentiate from others already on the market? Elon Musk says that “Consumers will always stick to the trusted name brands unless your product is ALOT better.” Is your product better? How will it help or enhance your customers life?
2. Know your numbers and dates
Once you know what your goal and rewards are, you need to figure out how much money you’ll need to reach your goal and how much you’ll charge for the rewards. Then it’s time to crunch the numbers and see if it’s realistic. For example, if you need $25,000 to make a documentary and are selling copies for $15, then you need to get at least 1,667 supporters ($25,000/15=1667). Don’t forget to make timelines for achieving your goal and sending out rewards because this is a big part of any crowdfunding project.
3. Build your media list
Think about where you would ideally see a story about your project published, then go to the site and look up articles on a similar topic. Then take note of the author of the article, their twitter handle and email if available. Put this into a spreadsheet, and keep adding more names, sites and contact info (multiple contacts per site is okay). Don’t be afraid to reach out before the campaign begins and share your project link. It’s also worth trying to get commitments for an article day of launch, and you can offer exclusive pictures or content as an incentive.
4. Make your video then your page
The vast majority of successful crowdfunding campaigns have a video, and it’s important to start on this early. Begin with a storyboard and script, and make sure to share with others and get feedback before starting to shoot video. Expect to rewrite your script and storyboard at least twice. Once you have your video made you’ll have a lot of the messaging figured out, and you can build out your page to complement the video. It’s always best to be concise.
5. Put together a press kit and pitch
Before launching make sure that you have all the collateral in one place that’s easy to share with someone that wants to write a story about your campaign. This press kit should include a brief summary of the team, the project, and high resolution images of your project. You should also have a quick pitch (about five sentences) that you can reach out to the media with.
1. Set up analytics!
After clicking launch on your campaign the first thing you want to do is get Google Analytics set up. Make sure to turn on e-commerce and demographic tracking so that you know where people are coming from and if they are pledging money to your project.
2. Take your project link and blast your media list
Now that your project is live, put a link to it in your pitch and press kit and reach out to the media list you put together. Don’t hesitate to message on twitter or facebook if you don’t have an email. If you don’t have contact info for a site, try emailing their firstname.lastname@example.org or any other common email addresses.
At this point you should be getting backers and comments on your project. Don’t forget to engage with your campaign as it makes people more likely to spread the word because they feel part of the project. If you have gotten any media pickup, engage those as well by sharing and commenting. If you have a marketing budget you may consider paying for a boost on Facebook/Twitter for particularly engaging articles.
4. Make more media targets
Keep looking for media contacts and don’t stop. It’s all about numbers when it comes to reaching out to the media, and the more you reach out to the more success you will find. As you continue to do this you should be refining your pitch and press kit. Also if your campaign has reached 100 percent of its goal, try reaching out to your local news and media. Everyone loves writing about local success stories.
5. Check your Analytics, rinse and repeat
Keep regular tabs on your analytics via your Kickstarter Dashboard, Google Analytics, and kicktraq.com and identify what is working for you. Now it’s all about keeping the momentum, so repeat steps 2–5 until the campaign ends.
1. Put link on top of page before ending
Once the campaign is over, you can’t edit your page, so make sure to include a link at the top to where ever you want people to go to support you further.
2. Wait to send your backer survey
Don’t send out your survey to your backers right away, because you only get to do this once and people’s addresses change. Wait until you’re almost ready to ship out your reward then send out the survey. You may consider using third-party services such as BackerKit to help you manage your fulfillment and survey process. It can also help to continue driving sales after the campaign ends.
3. Update and engage
After your campaign ends don’t leave all your supporters in the dark. As you make progress on your project (or have problems) share it with your people so they can be part of the adventure.
4. Don’t forget the details
Don’t forget or procrastinate on the details. For example, if you’re going to be shipping out a reward don’t forget about the boxes your reward goes in and the labels to go on the box. The devil’s in the details, and you don’t want these little things making you late.
5. Fulfill and let everyone know it’s available now
Now that your project is complete and you’ve sent it out to everyone that supported you, share the news with everyone. If you have a social following post it there, and you’ll probably get some more orders. Also it’s a good idea to blast your media list again, and offer to send out review units if necessary.
Originally published at powerpractical.com.