Pebble e-paper watch launched on Kickstarter a campaign to raise US$100,000 but ended up raising over US$10,000,000. How and why did this happen? And what can we learn? Here are our 7 observations and tips…
Pebble watch sought angel investors on a crowdfunding site, however they were not offering equity – just a chance to purchase the watch and be part of ‘making it happen’. Therefore, the project was exposed to potential ridicule and potentialy massive excitement. Pebble clearly got excitement and the momentum behind the project meant that it beat it fund raising target by a factor of 100.
The take away tip is to hold back on asking for funding until you have a compelling and exciting proposition. Of course, there is a reverse too, that if you hold back too long, then someone else will get there first.
The pebble e-watch is an original product. It not yet another iPad stand. It is not an art project or another music band asking for money. It is original and unique. Your product (or service) needs to be something different. Me-too products won’t get the same level of take up.
The minimum investment for Pebble was very small. In fact, for US$99.00 you could ‘pre-order’ a watch which was slated to retail for US$150.00 and a piece of the company.
Can you offer low investment entry points in return for products and services?
4. One picture tells the whole story
The Pebble is a clearly understood consumer product and, one photo tells nearly all the story. It is so neat, that it is easy to just say ‘I want one’ simply by viewing the picture.
The question for other propositions – such as music or SaaS – is can you achieve the same? Probably not – which is why increasingly service fund raising propositions use a video to try to capture the emotional pull of the consumer or the business angel.
Can you devise a single picture or a single message which captures what you do?
5. Multiple sales = distribution
The next clever thing about the pebble proposition is that for its largest investor the company would provide 100 watches – so basically, stocking up their wholesalers and distributors. If you were a watch distributor and you saw the excitement of so many people who wanted to buy a pebble watch – you’d want to become a distributor too, right? And be a part of making the product happen.
Well, as more distributor sign up to take 00’s of products at a time, so the confidence in the product becoming reality becomes greater.
Can you build a distribution path as well as sales via your crowdfunding activity?
Pebble used the crowdfunding environment to generate massive momentum and generate consumer sales as well as establish a distribution network – all from one page and one photo. (Okay, there was a bit more – but you get the drift)
Find a crowdfunding service where products like (or a bit like) yours have succeeded in the past.
7. Not a test!
Essentially, the Pebble watch founders built a platform that allowed more people to get involved – at what ever level – and as they did, so the level of confidence in the product grew and grew. I often hear people who are tempted to ‘test’ a project on Kickstarter or other crowdfunding sites to see is there is any interest. In a way, this is an attempt to build customer feedback into your product before you build it – but it doesn’t allow you to do anything with the feedback because by the time you’ve got the feedback it is too late to change your product or proposition.
Instead, Pebble gave the impression of being a clear and clearly thought out proposition. It didn’t feel like a half-hearted test that some one wanted to try out.
Be clear, confident and bold. And do your homework. Good luck!