With the rise of crowdfunding websites such as KickStarter and Indiegogo, it may seem easier than ever to start a new enterprise. However, this is not the case; launching a successful crowdfunding campaign requires careful consideration and a lot of strategy. Hyungsoo Kim ’02, entrepreneur and creator of the Bradley Timepiece, returned to campus on Thursday, Oct. 22 to share the dos and don’ts of successful online fundraising.
As part of the Patricelli Center for Social Entrepreneurship’s (PCSE) Fall Workshop series, Kim discussed the steps required to create, market, and effectively crowdfund a new product. He began by addressing how the advent of crowdfunding sites has transformed how entrepreneurs can raise funds for the initial phases of their product or services without having to give up too much of their company to investors or rely on family members.
“Even three years ago, there was no such thing [as a crowdfunding website],” Kim said. “You would have a really great idea, but no way of raising money, so there was no way to start anything if you didn’t have money, or your parents or family didn’t have money. So, the crowdfunding campaign had a huge impact on a lot of startup companies as well as people who run social campaigns.”
As opposed to the traditional investment model, where one develops a product with financing from investors—to whom one generally gives a large stake of their companies in exchange—the crowdfunding process maintains the entrepreneur’s independence by reversing the process by which a product or service comes into existence.
“Now, [when] you have the prototype, and then you post it on Kickstarter, and then all of the marketing…is free, basically,” Kim said. “Five percent of the money you raise, you pay to Kickstarter, but it’s not that much. And, if you don’t make any money, you don’t pay.”
Kim then used his own product as a model, detailing the way in which he successfully crowdsourced the initial phases producing the Bradley Timepiece, a watch that allows wearers to tell the time through the senses of sight and touch.
The project was inspired the discontent expressed by one of his classmates at the MIT Sloan School of Management where he earned his MBA, who was blind and could not find a watch that was both stylish and functional. Though talking watches and watches with open faces were available, the former was disruptive and the latter rather useless, as the hands would easily be shifted.
“I was really surprised that there was nothing else,” he said. “There should be something else.”
So, with a team of engineers and designers, Kim created the Bradley Timepiece and embarked on the process of marketing, crowdfunding, and selling it. He stressed the importance of generating buzz around a product before launching a Kickstarter campaign, as the first few days that it is can make or break its success.
Kim and his team did this by making a video as well as social media pages. Generally, Kim noted that the most effective advertisements for mainstream products were those focused on the design of a product and were generally about a minute and a half long. However, his video, featuring the story of Brad Snyder, veteran and Paralympic champion who lost his sight while on active duty in Afghanistan clocks in at about six minutes.
Katya Sapozhnina ’16, founder and president of the Wesleyan Entrepreneurship Society, asked Kim about his risky decision to create such a long video that advertised the product from a personal angle.
“I wanted to ask about the video and why you chose to focus on the personal story of someone who is blind versus the cool design aspects,” Sapozhnina said.
Kim responded that he took such a risk because he felt the story was compelling (so much so that he named the watch after Snyder) and would achieve one of Snyder’s goals of bridging the gap between the blind and the sighted.
“We wanted to connect people, those who are visually impaired and those who are sighted,” Kim said. “We wanted to break down the wall between them.”
Additionally, Kim reached out to many bloggers in order to begin circulating information about the product and impending Kickstarter campaign. In total, he got media attention from about a dozen different sources prior to the page’s launching. All of this preparation work led to a strong start, which put him on the front page of the website for four days. That exposure, gained either by popularity or staff picks, is what can make or break a project’s crowdfunding campaign.
He also made note of the modest goal he posted on the site : $40 thousand.
“Our internal goal was $80 thousand,” Kim said. “But we put $40 thousand because if you don’t reach your goal, you don’t get any [of the donated funds].”
Employing these strategies, Kim was able to raise approximately $500 thousand in the 30-day period during which the page was live.
Sapozhnina found the presentation informative and encouraging.
“I think crowdfunding is wonderful because it makes being an entrepreneur more accessible,” she said. “We can now use very little money while raising thousands, even before making the product.”
Jennifer Roach ’14, Civic Engagement Fellow for the Center of Community Partnerships, noted the universality and applicability of Kim’s work to students’ work at the University and beyond.
“Whatever project they end up doing, whatever organizations or business they end up starting, crowdfunding is one of those tools that might be useful to a lot of students working on any number of projects,” said Roach. “It’s applicable if you’re doing nonprofit work, if you’re at an educational institution…it can even be used for a political campaign. It’s very cool to be able to have [the opportunity], any time that you get a chance to learn from someone who has started their own business, who has done something that you’re interested in after graduation, whether or not you’re interested in crowdfunding.”
For all students, there is a lesson to be learned from someone who has been there before.
“You never know what you’re going to get out of one of these workshops,” Roach said.