As part of our experimenting with venture sales and marketing techniques, we launched a Kickstarter campaign for the book and supporting materials. We thought we would focus this week’s blog on crowdfunding, Kickstarter, and our own decision process to set it up. It is in Q&A format, where we get to ask both the Qs and provide the As! But feel free to email us directly if we miss a question you have.
What is a Kickstarter?
A Kickstarter is in a broader category (or frame of reference) called crowdfunding, which is a way of raising support and awareness for projects. Crowdfunding has been enabled by the intersection of social preferences for helping people, even in an online format; technology that allows people to communicate with a broad audience virtually; and in some cases regulatory changes (JOBS act) that permits nonaccredited investors to invest up to $5,000 in a venture for equity. A Kickstarter gives people with projects a way to raise dollars for their efforts—whether that is creative endeavors like making movies or books, or new products that require some investment to create. Indiegogo is another platform that provides a similar service.
Running a Kickstarter allows you to get financial support, test market interest in a product in advance, and engage your advocates and supporters. Most Kickstarters are rewards-based: in exchange for your support, you can get a product (to be built) for a lower amount than expected retail value, but also get a t-shirt or other swag in exchange for your support. A founder can set a minimum level (typically dollars, but also relates to a number of products pre-sold) to reach for the campaign to be successful so that the project proceeds or “is funded.”
So why do one for the Titanic Book?
We clearly already have the book—so why do a Kickstarter if we don’t need funding? Three reasons. First, in the book The Titanic Effect we talk about Kickstarters as a way for startups to gauge interest in their ideas. We wanted to experiment with the tool to have direct experience and play around with a new mechanism for supporting entrepreneurship. Second, we wanted to test interest in a couple of tools we hope might help readers operationalize the ideas in the book. Specifically, one tool we thought about is a giant map on a wall poster for a startup. Employees/supporters can put colored pins in danger areas for each of the “debtbergs” we identify in the book. It can be a distant early warning system. We also wanted to know if there might be interest in a book club version that would come with a guide to help groups discuss the book. And third, we wanted to develop some cool swag for supporters, like the t-shirt and snow globe pictured below, as additional ways to engage you.
What were some key choices and design parameters?
We talk in the book about founders needing to access talent and knowledge when they don’t have experience or skills in an area. Following our own counsel, we were fortunate to be able to engage our daughter Lindsey, who has experience designing and running campaigns in Kickstarter. The first major choice is the reward structure. Besides the product (in this case a signed book), what other rewards might people appreciate? And how can you structure the reward levels in a fun and interesting way? In keeping with the Titanic theme, our levels are all ship related. This is what the reward levels look like on the Kickstarter:
A second element is stretch goals that are awarded to all participants if you reach certain levels of contribution. For example, if we reach certain goals in terms of funding dollars or social media exposure, all participants receive a Titanic Effect bookmark, sticker, and possibly can participate in an online Q&A forum with the authors. This builds a community feeling and goal for shared effort.
What have we learned so far?
Our primary goal for the Kickstarter was to learn more about the tool and experiment with it. Done! It is a cool and fun way to think about packaging offerings and engaging with supporters. We also recognize that we need to get better at sharing our ideas with our own friends, colleagues and network, to activate them to help us get the word out. We do believe that The Titanic Effect concepts can benefit entrepreneurs, investors, and startup supporters. So, we want to get these ideas to as many people as possible.
I should note that a Kickstarter rarely makes any money—the idea is to build community support and validate ideas. In our case, for example, some of the swag will cost more to get made and ship it than we are asking for in the reward category. But, what we have learned already is fun and helpful for future projects we might advise on. We will learn a lot more in the next ten days about whether our activation efforts work.
How can you help?
If you are inclined, we would love to have your feedback on the overall Kickstarter design and rewards. Of course, if you want to participate at any level, bonus! Best case is that you share and promote this within your own community. This is how Kickstarters can “amplify” or expand awareness beyond their own network to reach more people. Here is a link for you to find the Kickstarter, and also share with your community if you want.