Life after Crowdfunding: How to Start a Business after a Successful Campaign
- June 12, 2019
- Will Turner
If you’re looking for a way to start a business on a tight budget. Crowdsourcing is a great alternative to traditional funding. Buzz around crowdsourcing has died down in the press in the past few months, which may lead some people to believe that the industry isn’t doing so well.
However, seeing how Pebble 2 managed to raise a whopping $12 million from more than 66,000 backers on Kickstarter, it seems like crowdsourcing is still a viable option for young entrepreneurs out there.
While there’s plenty of material on the Internet that can help you have a successfulcrowdsourcingcampaign, what happens after you raise the money? You have to face reality – IndieGoGo and Kickstarter are great platforms for launching a product but not great for launching a business.
Thinking for the Long Term
In most cases, startups think only for the short term. Some startups expand their product offering too fast, while others try to evolve their core products immediately after the campaign has ended, which usually results in a diluted vision.
What’s worse, most people find themselves deal with hundreds or even thousands of orders without the necessary tools for staying on top of it all. And according to CNNMoney, around 84% of Kickstarter’s top projects ship late, which makes their customer’s – for the lack of a better term – shopping experience a negative one.
Now, before crafting a clever video or targeting celebrity influencers, Zac Park, who raised almost $3 million from multiple crowdsourcing projects over the last couple of years advises every aspiring entrepreneur to ask himself the following three questions:
- Who is your project for?
- Where do your target consumers spend their time online?
- What is the quickest and cheapest way to get in front of them?
Once you create a profile of your ideal customer, launch the campaign and actually raise some money, your job isn’t done – you have to make an effort to start a conversation with your customer and get as much feedback as possible. This feedback needs to guide your next decision.
Why You Need Customer Feedback
In their interview with Business News Daily, Phil Moldavski and Ricky Choi, founders of crowd-financed sock company Nice Laundry explained that if you want to turn your crowdsourcing success into business success, you need to pay special attention to the following three things:
Talk Directly to Your Customers
First off, you need to understand that your backers are the most valuable asset you have in your arsenal. So before and during your campaign, you need to get feedback from your target audience, and even after it’s all over, you should talk directly to your backers in order to get some feedback on future product development, pricing and service standards. So be prepared for a lot of email back-and-forth, messaging and hour-long phone calls.
Leverage Your Story for Marketing Purposes
While we keep mentioning that your backers are the ones who made you successful in the first place, you shouldn’t forget that your idea was interesting enough to get complete strangers to invest their hard-earned money into it. You should embrace your crowdsourcing roots and implement your story into your marketing efforts.
Make a Long-Term Commitment
Once the campaign is over, some people simply aren’t able to sustain the velocity – but it can be done, you just need to be really strategic, adjust your expectations a little and make a long-term commitment to seeing your project through. This means you’ll need to figure out things like automating your shipping process, adjusting your production schedule, etc. because in order to start scaling, you need to completely iron out these demanding tasks.
Choosing the Right Platform
After you’re done with the feedback, it’s time to move forward. Now, there are several different directions you can go after your campaign. Some people go for specific, post0crowdfunding platforms, while others choose to create their own ecommerce sites.
So let’s take a closer look at some of the more popular options in more detail:
If you don’t feel like you’re ready enough to manage your own ecommerce business but you still have a ton of inventory on hand and you’re ready to sell your product on a larger scale, Amazon Launchpad could be a good choice for you.
The Launchpad started as a “one-shop-stop” for new tech companies, but after a while, Amazon opened a dedicated shop for Kickstarter projects. It offers a large variety of tools like custom product pages, different marketing packages and access to Amazon’s fulfillment network, among others.
One of the more popular option among campaign creators is IndieGoGo InDemand – a feature on IndieGoGo’s official site that allows people with successful campaigns on both IndieGoGo and Kickstarter take pre-orders for as long as they want.
This is a good option for you if you’re still in the production phase of your campaign and you still don’t have a finished product on your hands. It’s great for building additional momentum for your project, because it allows you to take advantage of platform’s ability to reach more than fifteen million people every month.
If you’ve finished a successful campaign and you’re completely ready to sell your product to consumers, then you should build your own ecommerce site with its own point of sale system like those found at Revel Systems. This may seem like a complicated process to some, however, you should know that most of the same principles you’ve learned during your campaign will also apply to your business venture.
When it comes to choosing a platform, you have a lot of choices. Some of the most popular platforms include WooCommerce, WordPress and Wix. But if your main goal is to open an ecommerce business once the campaign is over, you should probably use Shopify, because it offers themes build specifically for Kickstarter and other crowdsourcing projects.
Lastly, no matter if you decide to go with an ecommerce business or a simple post-crowdsourcing platform, the most important things is to keep your backers up-to-date on your progress and follow through on your promise.
They are the ones who believed in your idea enough to give you money from the start and by keeping them satisfied, you’ll be able to motivate them to spread the word about you and your organization, so that your business can continue to grow after the campaign is over.