Combatting the Mid-Campaign Slump

(I have been writing about what I call "Entrepreneurial Intelligence" (or ENTINT for those who like acronyms...) on and off for a couple of years now.  Part of what I am coming to realize is that everything I do in support of entrepreneurial crowdfunding efforts through Mercyhurst's Quickstarter Project is really just intel.  The "best practices" report below, put together by my Research Assistant, McKenzie Rowland, and focused on dealing with the dreaded mid-campaign slump, is a good example)

When running a crowdfunding campaign, it is common to notice a dip in the activity in the middle of the campaign.  It is so common, in fact, that it has  a name - 'the mid-campaign slump".  

Fortunately, there are a number of tactics that you can apply to overcome this slump and keep your campaign running at a more even pace.  The table below is a ranking of what techniques the majority of crowdfunding advice-givers have found to be the most instrumental in campaign success (It's a big table so be sure to scroll right to see all the columns!).

Overall, the most common approaches are ones designed to make backers feel valued throughout the campaign.  By sending personal messages or emails and keeping them frequently updated with photos and posts, you’re showing them that you value their contribution and that their donation matters.  

Incentives also appear to be a common way to bring in more contributors and funds, and can boost donations when campaign activity is low.  This may encourage current backers to bring in others to the campaign, so it is likely important to tailor your incentives to the core value proposition of the project in order to bring in the most donors possible.  

These efforts can be time-consuming, however, and may result in greater costs to the campaign so it is important to make some estimate, in advance, of the cost (in terms of both time and money) to benefit ratio before pursuing any of them.

Want To Invest In People Instead Of Companies? Now You Can! (Entrepreneurial Intelligence)

Crowdfunding is a busy place these days.  While the largest and most popular site, Kickstarter, continues to fund a variety of creative projects (last year Kickstarter funded more creative projects than the National Endowment for the Arts...), specialty crowdfunding platforms are now available for everything from education to issues in the developing world to scientific research to, of course, porn.

For me, understanding crowdfunding is becoming an increasingly important part of what I call "entrepreneurial intelligence" - or, stuff that is outside entrepreneurs' control but is still critical to their success or failure.  Crowdfunding is rapidly filling a space left untouched by bootstrapping, angel investors and venture capitalists and understanding the strengths and weaknesses of various crowdfunding platforms would seem to me to be a critical intelligence requirement for entrepreneurs.

One of the most interesting of the new crowdfunding platforms is Upstart.  Upstart allows you to invest directly in a person.  In other words, you give them some money now to pay off a loan or to learn to code or to expand a business, and they promise to pay you a small percentage of their income over the next 5-10 years.  Repayments are capped (typically at 3 to 5 times the amount invested) so people can pay off their backers early if they make a lot of money.

 

Like a venture capitalist or angel investor, you could lose all of your money if the person you backed doesn't make enough.  Upstart uses statistical models to predict how much the "upstart" will earn over the next ten years based on degree, school attended, test scores, number of job offers, work experience, etc.  The amount the upstart can ask from backers is based on this model but as Upstart notes:  "Any estimate of returns is highly speculative, subject to a high degree of variability, and not based on historical experience. The pricing engine is novel and untested and relies on broad-based statistical data that may not be representative of any individual’s actual future income."

This is, however, a pretty good deal for investors if everything works out as planned.  A $300 return on a $100 investment over 5 years represents a nearly 25% annual rate of return.  Sure beats the 2 bucks your average money market fund will likely yield over the same period...

30 Hours To Go On My First Kickstarter Project - A Pre Post-Mortem

My first Kickstarter project, for my card game Widget, will end at 1758 on Saturday April 6 -- about 30 hours from now. The chart below shows the progress to date.

Most people wait until after it is all over to capture their thoughts about the process. I wanted to do something a bit different: Capture my thoughts just before the project ended and then compare these impressions to my more considered ones after the campaign was over.



Best Surprise: The level of support from all sorts of people - many of whom I don't know (or didn't know until this project began). Family, friends, former students, colleagues, other game designers(!), artists, and people I have never met from countries I have never visited have helped get Widget to its goal and well over it. I absolutely love this aspect of Kickstarter! It is incredibly rewarding to work directly with the people most interested in the game. 

Worst Surprise: My level of exhaustion. I am tired, folks -- bone tired. While eminently rewarding, this process has worn me out both physically and emotionally much more than I expected. It is kind of like having your first child. You have no idea what to expect next and your "baby" keeps throwing surprises at you. 

Most Interesting Finding: My total inability to use Twitter to help generate pledges. I spent a lot of time on Twitter and got extraordinarily good responses from people - lots of re-tweets and some interesting conversations. 100s of thousands of people have received tweets about Widget at this point. Return on time invested? 4 pledges, $65. While I am not discounting the intangible value of the experience, it is clear I am either "doing it wrong" (likely), Twitter can't really help in this way (hmmm...), or Twitter can't really help at all (unlikely but possible). Something I intend to think hard about... 

My next steps are to make it through the next 30 hours or so and then get the game printed and out the door. And yes, I am already working on my next project!

Well-known Terrorist Organization Seeks To Crowdfund Operations With Kickstarter

In what could be a preview of many more such campaigns, a well-known terrorist organization with
worldwide ambitions recently posted a preview of its crowdfunding campaign on the popular site, Kickstarter.  Click here to see the campaign now.

While the site is currently not live (i.e. not actively accepting donations) and it is unclear if it will be approved by the Kickstarter staff, the organization claims it is seeking the funding due to recent US activity which has left it depleted and without an adequate base of operations. 

Kickstarter is one of the new breed of sites which allows inventors, artists, dancers, game designers and others to go directly to fans and supporters to seek funding.  Well known projects from the site include the Pebble Watch, popular musician Amanda Palmer's new album and the amazing new card game, Widget.

Just Launched My First Game, Widget, On Kickstarter; ENTINT Questions Generated At A Staggering Pace... (ENTINT)

You might notice something different about the site.  Over to the right you will see a small box that contains details on my first game, Widget.  I launched this game last night on Kickstarter.com and the text box you see now will stay up there for the next thirty days or so (clicking on the box will take you to the Widget website in all its glory).

Kickstarter gives you anywhere from 30-90 days to make your target (in my case $4000.  I set my time limit for 30 days -- which Kickstarter recommends).  If you make it, you get the money.  If you don't, you get nothing (and all of your backers do not get charged anything).  Basically, failing costs your backers nothing and costs you only your ego...

So far the launch has generated as many intelligence questions as it has answered.  More next week!

(PS.  On a personal note, I genuinely appreciate the readers of this blog who have backed this game already on Kickstarter.  I have a long way to go yet, but it is both encouraging and humbling to be the recipient of so much good will.  While I also understand that this game might not be perfect for many of the rest of you, I do appreciate those of you who have taken the time to post to Facebook, tweet about it, or otherwise share it with your friends and family.  I am pretty certain that there is someone in everyone's social network who will enjoy this game.  My challenge is to the get word out to them and your help has been invaluable!  Thanks! Kris)

What Is Crowdfunding And Why Is It Important To Intelligence? (ENTINT)

http://widget.launchrock.com/

Six more days...

If all goes well, in six days, I intend to launch my first game, Widget, on Kickstarter  (if you are interested in the game itself, you can get more info by clicking on this link).  Once launched, I will have 30 days to get "funded" by various "backers".  If I fail to reach my pre-designated goal, I get nothing at all.

That's how crowdfunding works.

Well, at least, that is how Kickstarter works.  Kickstarter is the oldest and most popular crowdfunding platform currently available.  For those of you unfamiliar with these platforms, you probably should be.  This is not just for entrepreneurs or people interested in entrepreneurial intelligence, either.  There are implications here for intelligence professionals at all levels of business ... and law enforcement and national security, too.  

Let me explain.  Kickstarter is by no means the only crowdfunding site these days.  IndieGoGo and RocketHub are two popular alternatives, but there are a growing number of these sites.  The pace of this growth is likely to increase in 2013 as new laws are set to come into effect that will allow contributors to take small equity interests in start-ups (the current crowdfunding model centers on what typically amounts to pre-sales of a product or service).  Forbes expects revenues generated by crowdfunding sites to double, from 3 to 6 billion USD, in 2013.  Increasingly, this is the way everything from music to games to books to electronics will be funded at start-up.     

Savvy intelligence professionals in the business world should be watching these sites for potential competitors that might emerge from successfully funded projects.  Likewise, given the underfunded nature of most start-ups, it makes equally good sense to see successful crowdfunded projects as a no-cost extension of your own R & D programs - buying out small companies with proven products may well be less expensive than developing them in-house.   Finally, understanding crowdfunding is going to be an increasingly essential element of providing entrepreneurs any meaningful intelligence support.

Law enforcement intelligence professionals should also be taking note.  While there is little evidence of criminal activity in crowdfunding activities to date, with an increase in money, crime is virtually certain to follow.  Fraud of all kinds, money laundering, illegal or unsafe products are all activities which the reputable sites work very hard to avoid but, with the expected growth, criminals will inevitably carve out new niches in the market.

While national security intelligence professionals might not be interested in some artist's new comic book, many of these sites either specialize in or actively promote innovative hi-tech product development and design.  In fact, some academics are even turning to crowdfunding sites to fund their research.  Everything from geo-mapping to verification of information on the internet to pens that can draw in 3D have been funded by crowdfunding.

Crowdfunding is both an innovative and disruptive practice that is set to become much more important in the coming years.  In my opinion, it is worth staying ahead of this particular curve.