Crowdfunding can be an amazing launchpad to your dreams as an independent designer and entrepreneur, but the landscape is vast and the competition can at times feel daunting. Since the dawn of Kickstarter and Indiegogo when independent dreamers looking to meet the funding goal dominated the space, large companies in the past few years have jumped on the bandwagon by using crowdfunding as a way to market an upcoming product and gauge interest rather than raise the capital to produce it. High- quality videos and content strategies from large competitors, well-funded startups, and crowdfunding-native companies can sometimes raise the bar in ways where it feels hard to compete. So where does the little guy fit in the crowdfunding landscape of 2020?
Julio Terra (left) and Daniel Mascarenhas (right), co-founders of Launch Studio
Daniel Mascarenhas and Julio Terra, co-founders of educational platform Launch Studio, saw this evolving predicament and wanted to find a way to help anyone with an idea to realize their crowdfunding dreams. They developed the Kickstarter Masterclass, a comprehensive online course that helps founders understand how to find their audience, do the proper prep before launch to ensure a campaign is successful, and tell a compelling story that makes people want to invest in your product.
We recently caught up with Mascarenhas and Terra to learn more about their mission and ask how they think the events of 2020 has either positively or negatively affected the crowdfunding world.
Core77: What is Launch Studio, and who is it made for?
Terra & Mascarenhas: Launch Studio is a step-by-step course on how to launch products on Kickstarter. It was created to empower independent designers and entrepreneurs who make physical products ranging from tech gadgets and everyday carry gear to furniture, timepieces, digital fabrication tools, synthesizers, camera equipment, bicycles, cookware, footwear, backpacks, robots, and more.
What are people going to learn by being a part of the Kickstarter Masterclass?
People will learn how to plan, develop, launch, and run product launch campaigns on Kickstarter. They'll get acquainted with foundational concepts in the first modules, such as how crowdfunding works, what type of products are well suited for Kickstarter, how to know when your product is ready for launch, and how to set your goal intelligently. In subsequent modules they will learn how to craft a compelling story to bring their product to life, how to use online advertising and email marketing, and how to pursue press and influencer coverage. The final modules dive deep into how to set the duration of a campaign and prepare for launch day, plus how to keep your backer community engaged while the project is live, and after the funding period.
How has crowdfunding changed over the past couple of years, or even over this quite dramatic year?
Over the last couple of years, crowdfunding has changed a lot.
It has fully matured from a fresh and novel approach to bringing to life creative works to an established method for independent designers and entrepreneurs to launch products. This development has made it harder for creators to get attention for their projects. On the flip side, creators can tap into a trove of insights by researching the thousands of successes and failures that preceded them.
The digital world in which Kickstarter inhabits has also evolved. Social media has become more saturated, and their algorithms have effectively erected a paywall between businesses and their audience. This evolution has made it harder and rarer for projects to generate viral sensation.
Some large campaigns' failure to fulfill their commitments has increased awareness of the risks associated with crowdfunding. These flops have led the press to become more cautious about covering products that are launching on Kickstarter.
In contrast, over the last several years, many creators and campaigns have delivered products that are innovative, delightful, or both. That has created a sizeable community of people who frequently return to Kickstarter to support projects from specific creators or categories.
"During 2020, creators raised more funds on Kickstarter than ever before. The success rate for projects in the design and technology categories also inched up a few percentage points. These stats show that Kickstarter continues to be a vibrant platform for independent designers and entrepreneurs."
Now that we've explored broader trends, let's focus on how Kickstarter has fared during 2020. The lockdowns and social distancing restrictions seemed to impact the design and technology categories on Kickstarter positively. In 2020, Kickstarter raised more funds for creators in these categories than ever before. This is consistent with the experience of other online marketplaces.
What are some of the main challenges independent designers are going to face right now in the crowdfunding landscape they should be aware of?
Spreading the word about a project has become more challenging. These three of the trends I mentioned earlier are driving this trend:
1. Crowdfunding is no longer novel, and does not generate attention in its own right.
2. Social media has become a pay-for-play space with limited opportunities for organic lift.
3. The press is more reticent to cover crowdfunded launches due to past project failures.
This development means that creators need to invest time and effort in building an audience prior to their project's launch. That's why pre-launch email lists have become essential. The value of adopting these audience building efforts can pay dividends well into the future, post crowdfunding campaign.
Backer expectations have become more demanding concerning the quality of projects – from the project video and page to the way creators engage with their community. The 27,000 successful design and technology projects that have launched to date have set standards that future creators need to meet or surpass.
This large collection of projects also serves as a powerful trove of learnings and insights. Creators can search through successful and failed projects to find inspiration and identify pitfalls.
This year's pandemic and lockdowns have brought some new hurdles too. It is challenging to produce compelling videos and photos when you can't get people together under the same roof for the shoot. It can be tough to connect with your audience when you can't meet them in real-world settings. It might be the wrong time to launch your product depending on its category, e.g., as a travel jacket.
These are not insurmountable challenges. Creators have been able to create compelling videos with a skeleton crew working safely. They have also been able to connect with their audience just by focusing on online channels. With the vaccine rolling out, your product might be in high-demand again in short order.
People are still hungry for new experiences and products. And, at the moment most people can only enjoy the latter of these two, which works to your favor.
Why is now a good time to launch a crowdfunding project?
2020 was an excellent year for the design and technology categories on Kickstarter. During 2020, creators raised more funds on Kickstarter than ever before. The success rate for projects in the design and technology categories also inched up a few percentage points. These stats show that Kickstarter continues to be a vibrant platform for independent designers and entrepreneurs.
New tools are available to help designers leverage crowdfunding to support their independent design practice. Courses like the Launch Studio Kickstarter Masterclass empower designers with strategies, tactics, and tools to use crowdfunding to launch products effectively.
Like most tools, your ability to leverage crowdfunding will grow with practice. At first, you should consider using it on smaller projects. As your mastery grows, you can apply it to more ambitious endeavors or keep your projects small – whatever suits you. There is no time like the present to start learning!
In an upcoming article, the founders of Launch Studio will share some strategies independent designers can use to successfully launch their products on Kickstarter—stay tuned for that piece coming soon.