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Running a successful crowdfunding campaign isn't easy. The odds are heavily stacked against you, as very few end up succeeding.
"Statistically, up to 89% of campaigns fail. Kickstarter has the highest success rate, however, the average funding amount per backer is actually quite low. If you manage to raise over $250,000 it's a fantastic achievement, as less than 0.5% manage to secure more than this amount," said Nathan Resnick, CEO of Sourcify and an expert when it comes to launching hardware startups.
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One startup who overcame these odds is Origami Labs. The Hong Kong-based company set an initial funding goal of $30,000. When its campaign ended a week ago, it exceeded its goal by 10x and raised a total of $333,907. The startup even gained celebrity backers like R&B artist T-Pain.
Launching a crowdfunding campaign is an effective go-to-market strategy for most hardware and IoT products. But with it being difficult to succeed, I asked ORII's marketing manager, Linnea Colt, for some advice on how she did it. Building a campaign that receives over 300 media mentions and raises over $300,000 wasn't pure luck.
"Before launching the campaign, our team spent months demoing prototypes with users across the world, reaching out to reporters and building a community who are genuinely interested in the product," Colt said.
Gary Vaynerchuk using ORII
"It's quite cool, man," said Gary Vaynerchuk when he tested ORII. If you can leverage celebrity endorsements like this, it helps build credibility with potential backers, who can't test the product in real life.
Understanding the algorithm of your crowdfunding platform is critical to increasing the chances of going viral.
Colt advised, "Do not launch until you are ready. The first 24 hours of your campaign is crucial to breaking into your platform's organic traffic. You need to have a list of potential backers who you know will convert within the first 24 hours of going live. These initial conversions will increase the chances of your campaign getting published and featured on the front page of your platform, helping you get additional visibility and exposure to thousands of potential backers."
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Don't wait until your campaign is live before trying to generate media coverage.
Colt recommends, "Target the top-tier media sources within your category before launch and ensure coverage get's published on the day you go live. Once you have been featured by top tier media, it will turn into a 'snowball effect,' and then coverage will start coming in organically."
Once your campaign finishes, you need to leverage your hard work and setup a "post-campaign solution." This bridges the transition between crowdfunding and commerce.
Colt recommends using Indiegogo InDemand. Here's an example of ORII's post-campaign, which allows them to continue raising funds and accepting pre-orders, even now that its campaign has ended.
Are you thinking of launching a crowdfunding campaign? If so, start planning at least three-months beforehand and follow the steps listed above. Doing so will dramatically increase your chances of beating the odds.
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