Crowdfunding for Entrepreneurs Crowdfunding Examples Lessons From The Winners
Crowdfunding for Entrepreneurs Crowdfunding Examples Lessons From The Winners Skip to content
Leslie Osborne, Sweat Cosmetics Marketing was another strength, as the team was well-connected thanks to their sports careers. They started the campaign with a 20,000-name email list and 48,000 Instagram followers. “Our network is our strongest suit,” says Osborne. “One thing we learned is that in equity, you can’t tell anyone you’re doing a campaign until it goes live. That’s when you start marketing. “We had 60 days once we went live, and Agency 2.0 did a great job promoting it with Facebook ads and other digital media. We’re a female-founded, female-run company, and we tried to hit home on that. “Our ads did great, and we were sending out email blasts. We spent $10,000 on Facebook.” As with many other successful crowdfunding examples, Sweat grabbed media attention by quickly hitting its $50,000 minimum. Their skyrocketing fundraise caught the eye of Money magazine and USA Today. The latter featured Sweat’s execs in a cover story on crowdfunding that dropped while their crowdfunding campaign was still under way. Like many product-focused companies that do equity crowdfunding, Sweat also gave investors perks like $100 gift cards for Sweat products. Big-money investors were treated to a New York City Sweat Party event. Sweat plans to spend its crowdfunding for business growth: new-product development, marketing, and inventory replenishment, Osborne says. Osborne’s tips: The higher your profile is going in, the more likely you’ll strike gold on media exposure during your campaign. Sweat’s execs had hit Good Morning America in 2016, and the company had products reviewed in women’s magazines prior to the campaign. Also: Shop around on legal paperwork, if you’re doing equity. Osborne says they got several bids for low-cost help, went with another provider than First Democracy’s own service, and saved several thousand dollars.
Crowdfunding Examples Lessons From The Winners
Chapter 4 by Carol Tice 30 Jun, 2020 One of the best ways to learn about crowdfunding is to read exactly how other startups ran mega-successful crowdfunding campaigns. Enjoy the insider tips in these crowdfunding examples, from recently successful creative startup teams in different industries. I’ve also included a rundown on the top 10 best Kickstarter campaigns of all time. Snuggly Success: How Animoodles Raised 4X Its Kickstarter Goal Can stuffed animals be even more lovable and fun? Animoodles says they can, when strong magnets allow a set of stuffies to be mixed into new shapes and combinations. Animoodles is also one of the most successful crowdfunding examples for a non-techy, consumer product in recent years. Billed as “the world’s cutest building toys,” Animoodles raised just over $100,000 in its Kickstarter crowdfunding campaign, blowing past its $25,000 goal. Not bad for a first product that attracted its initial audience with a ‘mystery’ opt-in page that simply hinted the team was making something and asked for emails. Created by a team of ex-Apple, Disney, and Pixar artists-turned-entrepreneurs, Animoodles became a crowdfunding darling by riding the cred of its team’s solid-gold work experience, coupled with the ‘awww’ factor. In a lively, animation-filled Kickstarter campaign page, the Animoodles team revealed the concept, backstory, and feel-good mission of Animoodles (to help save endangered species). Their campaign page is a great example of successful crowdfunding marketing, with fun videos and lots of info. Here’s co-founder and chief designer Marissa Louie with the lowdown on the role rewards played in this campaign, and how Animoodles delighted its backers: Marissa Louie, Animoodles “We thought Kickstarter was the best match for us, in terms of having a lot of toys, kids’ products, and design-oriented projects, compared to other crowdfunding platforms. “Our rewards included cool, free activities and crafts, to give little touchpoints of excitement. When we hit a milestone, we’d reveal the next level, because we wanted to keep the momentum going. “We offered Halloween stencils based on the characters, and people used them to carve pumpkins—and then posted those on Instagram (which also helped spread the word about the campaign). Our activity storybook was a coloring book but also tells a larger story about the animals, which are all endangered species. “We had eight rewards levels in all, and we’d unlock new levels as a level got full. When we hit goal, we launched an elephant as a bonus animal, with 100% of profits going to the African Wildlife Foundation. “We could have capped the reward levels and limited how many we sold in the campaign. Kickstarter lets you. But we wanted to build the first generation of avid fans. They’re still active a year later, sharing photos of Animoodles online.” In wildly overselling its campaign, though, Animoodles faced a classic manufacturing test: how to deliver, on time, what turned out to be over 900 orders. (Too many bad Kickstarter crowdfunding examples have had a hot campaign, but then failed to deliver the goods.) The tricky part was, Animoodles had designed some rewards levels as “pick any two” and “pick any three” of the five-animal set, so each order had to be customized. Planning for production started 6 months or more before launch, Louie says. Having set an aggressive delivery date of 6 months after launch, Animoodles relied on two team members with a combined total of 50 years’ manufacturing experience, including making toys in China. One was a former director of top educational toy maker Leapfrog. Packs that were sold as a fixed set—such as packs of all five animals in the original set—were pre-packaged at the factory, Louie says. The mix-n-match sets were shipped as individual plush toys and packaged at a U.S. facility. With careful planning, Animoodles was able to deliver in 3 months, overachieving to surprise its fan base. Louie’s tips? You want to hit your funding target fast. Animoodles hit $25,000 in 11 hours—and then Louie got busy alerting the media. The result was several favorable mentions during the campaign that helped draw more backers. What’s next for Animoodles? In September 2018, the company was plotting its return to Kickstarter to sell its second six-pack of plush toys. The original set is for sale online and in select toy and gift shops. Start selling online now with Shopify Start your free trialRewards Equity How Canada’ s Hardbacon Raised $52K – and $250K
Montreal finance-education startup Hardbacon started small in crowdfunding, with a $7,600-goal campaign on Ulule for an online finance course that, at the time, didn’t yet exist. CEO and co-founder Julien Brault chose Ulule in 2017, after meeting the platform’s CEO when Ulule opened a local office. At the time, Brault says, he was casting around for a business idea that would use the website-development and lead-generation skills he’d honed at past jobs. What he came up with was an online course in investing. Not Another Boring Course About Investment was marketed as “100% guaranteed unboring.” What drove this seemingly low-key, small campaign to wildly overachieve and raise nearly $52,000? A hilarious short video featuring Brault, his cat, and a guy on a toilet, demonstrating Hardbacon’s zany, fun approach. Hardbacon took full advantage of Ulule’s advanced translation features, which meant its page would display in French or English automatically, depending on the user’s preference. He said Kickstarter couldn’t offer this seamless experience. Out of all the startup crowdfunding platforms out there, Ulule was the only one that actively sought Hardbacon’s business, offering tips on how online fundraising works, he says. Trying to raise such a small amount on Kickstarter, Brault doubted they’d get featured, especially since their own backer list was under 800 people. Julien Brault, Hardbacon With modest reach on their own, Brault says Ulule helped Hardbacon ramp up fast. “Ulule told us how to run a campaign,” Brault says. “You usually make mistakes and get good at crowdfunding over multiple campaigns. Instead, at Ulule, we were in their office, they had their manager help us. We had a bug once, and sat and talked to their guy while he fixed it. “They taught us, ‘your biggest marketing asset is your contributors.’ So we started reaching out to influencers. I’ll give you a secret: Most are charging money, and won’t share your stuff free. We built a list of people who had a huge following who weren’t stars, but had enormous reach. “We’d build quotes with their face, and they thought it was cool. They’re flattered. One said, ‘Your video is so fun, I’ll share it free.’ Some [second-tier] influencers aren’t in the business of monetizing their reach.” How did Hardbacon go viral, from its relatively small fan base? Brault says the startup got a little help from Nouncy, a social tool that helps you encourage all your fans to post something at the same time. If 150 people around Montreal’s tech scene tweeted about Hardbacon in the same hour, hundreds of people would see multiple social media connections talking about Hardbacon all at once. This piqued interest and brought new backers. This initial success got Hardbacon launched, and it quickly grew into a much broader financial-education platform, more of a Mint.com for Canadians. A year later, it was time to leverage that initial crowdfunding success and take it to the next level. With more knowledge of how to do online fundraising, the startup embarked on an equity crowdfunding round for the Hardbacon app. This time, Hardbacon chose Canadian equity crowdfunding platform GoTroo. Hardbacon hit its maximum target and raised $250,000 on GoTroo in roughly 30 days in summer 2018. Why GoTroo? Brault cites a novelty element of using a newer, emerging platform (GoTroo was founded in 2015), and he says he liked the Canadian focus. The big plus: The equity raise could go for general business purposes and growth, rather than being earmarked for one product. The relative rarity of equity crowdfunding helped Hardbacon get press attention, too. Brault says over a half-dozen publications mentioned the GoTroo campaign—driving traffic to the campaign page and yielding social proof in the form of quotes Hardbacon added to the page. Different media were interested in different angles, Brault says. Financial-services writers liked that Hardbacon included a financial-planner tool, and tech outlets noticed the app got featured in Apple’s “New Apps We Love.” In the GoTroo equity campaign, the startup sold a roughly 18% equity stake, at $.90 per share, to over 360 investors. Minimum investor commitment was 110 shares. Hardbacon was valued at $1.5 million going into the transaction. Hardbacon’s own users were a major source of funding, especially in the first days, says Brault. Some $30,000 was raised on day one, with the campaign hitting $100,000 four days in. The secret sauce this time? Text messaging, press mentions, and a snappy hashtag: Software such as TextMagic enabled Brault to send out mass text messages that appeared individualized to hundreds of followers at a time. This spread the word quickly.Going For Gold Sweat Cosmetics Leverages Its All-Star Team
The beauty business is tough to crack for new entrants, and there are few equity crowdfunding examples in this sector. But Sweat Cosmetics in Denver made it happen in April 2018, with a big assist from its amazingly photogenic, all-woman founder team of former pro athletes. Sweat creates makeup athletes can wear while they work out, making the founders the perfect spokeswomen for their products. The team consists of all former pro athletes, including two-time Olympic soccer gold medalist Lindsay Tarpley. Sweat raised $255,000 from over 500 investors in April 2018 on Indiegogo’s First Democracy VC equity crowdfunding platform. Investors received preferred stock in Sweat. Co-founder Leslie Osborne said the campaign had a $50,000 floor, and anything above that was a plus. Putting the equity crowdfunding campaign and legal paperwork together was a 6-month process, Osborne says. Strengths that weighed in Sweat’s favor for an equity campaign: A previous small seed-funding round of $30,000 or so in 2015A sales track record of more than $1 million in revenue to dateSweat’s marketing firm, Agency 2.0, had a relationship with First DemocracyCan you hum the Olympic theme?Leslie Osborne, Sweat Cosmetics Marketing was another strength, as the team was well-connected thanks to their sports careers. They started the campaign with a 20,000-name email list and 48,000 Instagram followers. “Our network is our strongest suit,” says Osborne. “One thing we learned is that in equity, you can’t tell anyone you’re doing a campaign until it goes live. That’s when you start marketing. “We had 60 days once we went live, and Agency 2.0 did a great job promoting it with Facebook ads and other digital media. We’re a female-founded, female-run company, and we tried to hit home on that. “Our ads did great, and we were sending out email blasts. We spent $10,000 on Facebook.” As with many other successful crowdfunding examples, Sweat grabbed media attention by quickly hitting its $50,000 minimum. Their skyrocketing fundraise caught the eye of Money magazine and USA Today. The latter featured Sweat’s execs in a cover story on crowdfunding that dropped while their crowdfunding campaign was still under way. Like many product-focused companies that do equity crowdfunding, Sweat also gave investors perks like $100 gift cards for Sweat products. Big-money investors were treated to a New York City Sweat Party event. Sweat plans to spend its crowdfunding for business growth: new-product development, marketing, and inventory replenishment, Osborne says. Osborne’s tips: The higher your profile is going in, the more likely you’ll strike gold on media exposure during your campaign. Sweat’s execs had hit Good Morning America in 2016, and the company had products reviewed in women’s magazines prior to the campaign. Also: Shop around on legal paperwork, if you’re doing equity. Osborne says they got several bids for low-cost help, went with another provider than First Democracy’s own service, and saved several thousand dollars.