Funding a creative product idea in Canada is now only a click away, sort of.
On Aug. 5, 2013 Kickstarter, the largest global crowdfunding platform, announced that Canadians can start building their own campaigns to seek funding for their projects starting in early September. If you’re not familiar with web crowd funding, the concept is simple. It is like the traditional business financing with investors and banks but with small cash amounts and its more interactive. Crowd funding pools a large group of individual contributors who give $1 to $1,000+ to collectively raise enough to launch a specific project. The average give is around $75 and the return to an investor is the expectation of a commodity called a ‘reward’ that you the funder choose and the rewards vary based on how much you contribute.
Design 1st is in the business of helping companies turn innovative ideas into useful and reliable product. The crowdsource funding vehicle is enabling exponentially more creative idea people for the first time in history. Kickstarter is growing exponentially and has helped fund blockbuster movies, arts, events and new product ideas, but never before on this scale in Canada. Other crowdfunding sites already open to Canadian projects include Indiegogo (notorious for its backing the Rob Ford Crackstarter campaign), “FundRazr” and a host of other websites that target specific funding initiatives.
Kickstarter’s successful platform has made it the elephant in the web funding space. Kickstarter claims to have raised $735-million in funds for 100,000 plus projects including the largest crowdfunding success of all time - the Pebble Watch, a project by Canadian expat entrepreneur Eric Migicovsky, which raised $10.3-million from 68,929 backers in 60 days.
Kickstarter offers a funding mechanism to enable entrepreneurs, with a caveat. All Kickstarter campaigns must set a funding goal and a time limit to raise the money, if the money request target is not reached in the time limit all funding is returned to the prospective backers. Let’s say you have an idea for a small box you control from your smartphone to turn on house lights. You decide how much money you need, for example $60,000. From there you build a web campaign on the Kickstarter site and with text and images you tell people about how useful the new product will be. You offer the potential funders rewards (that you dream up) which can be for example a T-shirt for a $5 pledge, or $75 for the actual product when it is finished being developed. When you are ready to go you launch a 30 day campaign and then watch as people pledge money for the different rewards you offer. If you reach the $60,000 goal with funders in the 30 days, you get the money. Example project – 3D Doodle Pen (Funded), take a glue gun and reconfigure it into a fun artistic tool.
Physical Product Ideas (my passion) and how to fund them through Kickstarter
A common misconception about Kickstarter is that anyone with a bright product idea can sign-up, fill in the forms and wait to receive funding to develop the product. This is far from the truth as Kickstarter has evolved their ‘technology’ category into strict Hardware Product Design guidelines that funding campaigns must follow in order to be eligible for funding.
There are 3 key areas critical to your campaign:
Neither Kickstarter nor funders will support projects that lack the experience, competence and capabilities to fulfill the project goal. In recent months, Kickstarter implemented new rules in response to a growing number of Hardware Product-based campaigns that failed to deliver on campaign promises, despite reaching their funding goal.
New product ideas need a strong compelling and easily understood product to back-up a clever online campaign. Credibility comes into play as the inventor must convey a cool and useful product that looks well designed, engineered and manufacturable. The further along you are perceived to be towards a manufacture ready product, the lower the risk the funders feel. Design 1st is a leading product development team of artists and engineers turning napkin sketch ideas into products. They help inventors prepare comprehensive, visual product presentations and prototypes best suited for Kickstarter campaigns. Our clients leverage our brand to bring credibility with their funding audience.
2) Convince funders you have a sound Product Development Process:
Kickstarter’s new rules clearly state that product campaigns must show their work through videos, photos, sketches, CAD models and drawings. They must be clear about the state of the development stage including a working prototype of the current product’s functionality. You must also explain how the final design will differ from the prototype and include a production plan and an estimated timeline.
Design 1st’s product development process and experience is perfect for meeting the Kickstarter campaign guidelines, helping inventor clients develop fully functioning prototypes, video and scripting, images and engineering shots of how the product is designed and a process plan to convey organized preparation and timeline for manufacturing. With our online capabilities in press releases, ad-words, targeted page ranking, website creation and branding materials we help drive the campaign funding once it is launched which is critical to getting the buzz so funders find and support the campaign.
3) Provide funders with cool rewards
Rewards can be many different things. The one stipulation is that these rewards must be made by people involved in the inventor’s campaign group. You can offer merchandise (T-shirts are getting a little tired) or you can receive a final product when it comes off the production line as well as funder ‘experiences’ like parties and special events. One of the new reward angles is providing behind the scenes access to experience the magic of product development. Funders who love to learn can follow the final phases in the product development through live events or online video design meetings. This allows curious funders to take part in the fun of developing a product and getting it past the mechanical and electronics engineering, through prototyping, testing, manufacturing and on to the shipping bay. Rewards can include anything that encourages funders to come along for the ride as the product they have invested in makes it way to market.
Collaborating inventors that are getting ready for their Kickstarter campaign are taking advantage of the not for profit Maker Faire movement that is allowing inventors all over the world to get their napkin sketch ideas out of their heads by utilizing Do-It-Yourself design, build and prototype facilities in their local community (call Maker Faire for the new location in downtown Ottawa). This is a low cost way to tinker, explore, collaborate with others and with onsite CAD and prototyping machines, inventors can create and build their own prototypes. Don’t miss the new Ottawa Maker Faire exhibition, this year August 31st to September 1 2013 at the Museum of Science and Nature. Visit http://www.makerfaireottawa.com/
As Canadian innovators, our collaboration options continue to expand. Product inventors and innovating companies have more options than ever to create and fund to bring their product ideas to life.
To learn more about Kickstarter campaigns and developing your product ideas and how crowdsourcing can help fund getting your idea to market, give Design 1st a call and talk with some of our inventors in the design and funding process already. Call Ian Kayser at Design 1st 613.235.1004 x228 and visit our website at www.design1st.com
Kevin J. Bailey
Founder and President, Design 1st
Founding Design 1st in 1996, Kevin has led the successful completion of hundreds of product developments in a wide variety of markets. He has developed a network of local and global contacts involved in the supply of innovative physical hardware product. His team at Design 1st manages an effective process for the creation of technical products with easy to use features, reliable materials, and overall product quality. With business understanding and product and process knowledge companies seek out Kevin’s help to steer their product development from the design concept stage to a documented manufacturable product, ready to launch.
Kevin can be reached at 613-235-1004 x225, or at firstname.lastname@example.org
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