Why I Canceled My Kickstarter Campaign

With a proven track record on Kickstarter, it seemed like the logical place to launch our first to market product. Here’s why that wasn’t the case.


First foray into crowdfunding

As mentioned in a previous post, in 2013 I found success selling Cord Tacos and Corditos on Etsy through word of mouth on blogs and social media. So in September of last year I decided to turn to crowdfunding on Kickstarter to update and improve the quality of my current products as well as introduce new products to the This is Ground line-up.

Why Kickstarter?

Photo courtesy of Bottom of the Glass

I chose to use Kickstarter because the platform is, by design, full of early adopters in tech who are eager to discover the next great idea or product and most of This is Ground’s products are centered around tech organization. It was the perfect platform for our product, providing us a way to market our new items and make some money to fund production. Before we launched, we got some great advice from someone who had run an incredibly successful campaign.

Advice from someone who ran a successful campaign:

1) Video is key — keep it short. 2 min max. Say what you are and why you’re on Kickstarter. People want to be inspired and believe in your product.
2) You *need* to drive people to your campaign. Figure out how much of your audience is on Kickstarter already and then try to push other people there through blogs, sites, writers..
3) Rewards — don’t over complicate. Have some stuff that’s exclusive only to the campaign. Also, add exclusive rewards throughout the campaign.
4) Fund amount — check out the success/failure of other projects in your category.
5) The 10-year Hoodie — Killed it. Take a look at their project and see what they did well
6) During the campaign — you need to be talking weekly. Get news out there. Add rewards. Get endorsements, etc. — this is a full time job 1-2 people
7) Fulfillment is a pain — no matter how well you plan. Over estimate — costs and time to ship.

Keeping this in mind, we put together all the materials for our Kickstarter, launched the campaign and in less than two weeks of fundraising, we had reached our project goal of $15,000. I was ecstatic.

Success

By the time the Kickstarter campaign ended on October 15, 2013 we had raised $31,838, over twice our original goal. It was a huge boon for This is Ground and allowed us to expand our operations significantly.

Through Kickstarter we had been able to reach an audience of innovators and early adopters, receive feedback in realtime as we were developing product and make improvements before releasing anything. It was an incredibly valuable learning experience as a new business and we took our success as an opportunity to continue expanding our product offering on the spot. Our backers and fans began sending in requests which fueled inspiration for new designs and helped us bring the new products to our customers faster than we would have been able to on our own.

My Second Kickstarter: Cargito Charging iPad Case

http://thisisground.com/collections/new-products

Riding the high of our Kickstarter success, we immediately began brainstorming ideas for what This is Ground should do next. I thought the next logical step for our company was to develop product for people’s devices. Eventually we narrowed in on tablets, noticing numerous cases available for iPads and other tablets but none that really stood out from a design or functionality standpoint.

While collecting design ideas, I saw lots of options for charging iPhone cases from companies like Mophie but very few iPad charging cases, so I jumped on the opportunity to create such a product that could be both beautiful and functional. Soon I was sketching out all my ideas in the Paper app from Fifty Three.

Working out the design

After several rigorous rounds of designing, prototyping and sampling, the Cargito Charging iPad Case was born. The upfront costs for this new product were significantly higher than for our other products. In addition to the leather and construction costs we were accustomed to for our other products, the Cargito required technical components too. To make the Cargito we needed a custom mold and battery plus Apple certified cables to power the iPad.

Because of these higher costs, we decided to turn to Kickstarter again so that we could help fund some of our production and development costs while also marketing the product to an audience who would appreciate it.

Prep time

In January of 2014, we started putting together materials and preparing to launch our campaign. This required some additional upfront spending. We dropped around $3,000 to produce our video and another $1,000 to sample out a working prototype of the Cargito plus construction labor. After nearly a month, we finally had all the parts necessary to introduce our product into the marketplace.

http://youtu.be/N0afrI1ZuAw

We didn’t yet have a final, replicable sample of the Cargito but we were eager to introduce our product to the world and figured the duration of the Kickstarter would give us enough time to finalize the design and fully troubleshoot the case. I was seduced by the idea of being first to market with a leather charging iPad case. It made me nervous that another company was going to come out with a competitive product and knock us down. This became a rushing factor that in many ways took our attention off of some key details.

In our hurry we even managed to start a fire in our office while experimenting with different battery packs. Thankfully no one was hurt, but it made for an interesting afternoon.

Testing the Waters

About a week before launching our Kickstarter campaign, we published a press preview page to our website to show to potential media. The page was designed to capture the e-mail addresses of interested press and customers as well as give them access to a short press release for the product and high-res images. Through this page we collected around 100 e-mail addresses and caught the attention of several major publications. Many expressed interest in receiving a Cargito to review immediately — a promising start.

Email capture for potential media partners http://cargito.thisisground.com
Cool Hunting was first to publish word of our new product.

I calculated how much we would need to raise on Kickstarter to begin producing the Cargito and make enough product to fulfill all the initial orders from our backers. The final figure was $40,000. Considering the success of our previous campaign and the fact that our product was the first of its kind in the marketplace, we felt confident we would reach our goal.

Unfortunately, what we didn’t do before launching the campaign was line up a media partner to work with. We had seen the success of Wear Gustin’s Kickstarter which raised over $400,000 (with an original goal of only $20,000) in large part thanks to a print article in Esquire magazine. However, our eagerness to be the first to market with a leather charging iPad case overshadowed our planning process and we forged ahead with our campaign, launching it on February 12, 2014.

Shaky start

“Important Kickstarter Security Notice” from Kickstarter

Two days following the launch of our Kickstarter, news of a security breach on Kickstarter surfaced. While no credit card information had been stolen, the hackers managed to access the usernames, encrypted passwords, e-mail addresses, physical mailing addresses and phone numbers of Kickstarter’s users. Understandably, this made Kickstarter users incredibly wary of the platform and scared potential new users from joining. Contributions across Kickstarter immediately fell and we experienced a decline in number of pledges we were receiving.

Even with the security breach, performance on the campaign was generally slow. Compared to the flash in the pan success of our first campaign, the $5,000 we had raised after two weeks of fundraising paled in comparison and we were stuck in a slump.

Why?

At the This is Ground office, I spent time with my team trying to figure out what wasn’t working. We all believed wholeheartedly in our product and its utility and we had received very positive press and feedback on the Cargito even before launching the Kickstarter. It seemed like it was a combination of factors.

One, the security breach on Kickstarter certainly wasn’t helping us attract backers.

Two, we had rushed the campaign. Enamored by the idea of being the first ones to market with a leather iPad charging case, we didn’t lay the proper groundwork for a successful Kickstarter campaign to sell a product no one knew they even needed yet and its slow performance was a result of that.

Three, this new product was at a higher price point and appealed to a more niche audience than our previous products. Our cord tacos, cordito and cordlupa, while designed with Apple products in mind, had a universal application and were at an accessible price point.

Four, the Kickstarter platform wasn’t right for our audience. Our customer base is incredibly diverse and for some of those customers, Kickstarter can be an unfamiliar and confusing model to participate in especially for those used to a “Buy it Now” button in traditional e-tail. Other customers weren’t interested in waiting for the project to be fully funded to receive their Cargito. The model was too slow.

During the campaign, we received a lot of interest from press and bloggers who wanted to test out and review the Cargito for us. While we had a working prototype in our studio, we didn’t have the ability to quickly sample out cases for press. This put us in a difficult position because without press we weren’t receiving contributions and without contributions we weren’t raising money to produce product. We were stuck in a catch 22 of our own design.

Leaving Kickstarter

Mid-campaign, after a several day slump with no campaign contributions I evaluated the pros and cons of continuing the Kickstarter with my team. It was a difficult decision to make because of how invested we were and still are in the Cargito.

After debating the issue thoroughly, we decided to pull it from Kickstarter. By no means did we want to abandon the Cargito; it was more a question of whether continuing to run the Kickstarter campaign was a valuable use of our time and energy when that time and energy could be channeled directly into producing the case and getting it into the hands of people who wanted it most. That’s all we really want to do anyway.

Next Steps

So, where does that leave the Cargito?

Despite the fact that we decided not to follow through with our Kickstarter campaign, the time we invested into the experience was a valuable learning tool. Thanks to this Kickstarter, we were able to develop and identify a customer base for the case as well as receive feedback directly from those customers.

Having now closed out the campaign with interest from press & customers, we are moving ahead with production of our Cargito cases and pre-saleing the Cargito and our other new products directly through our own site on a more flexible timeline. Our plan is to field test prototypes, get many working versions out to press, restart the promotion and ship out Spring 2014.

pre-order http://thisisground.com/collections/new-products

UPDATE 2/28: Since shifting to our own preorder system, we’ve eclipsed the amount raised on Kickstarter. Now we’ll be able to put those funds towards production and ship the product sooner than before.

If Kickstarter’s model was that the funds were secured regardless of where the amount ended up, we would’ve continued the campaign. Now we’re able to guarantee that the effort put into promoting will result in the funds needed to launch the product.

Kickstarter obviously takes a cut of the funds raised. I would also consider a model where they get x% if the goal is met or a higher percentage if you come short. That seems like a win-win for Kickstarter and the small business. Please shoot me your thoughts @macadaan.