Self-Analysis of a Failed Kickstarter Campaign Reveals Lessons Learned
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- June 9, 2014
LightStrap was a good idea, but a campaign gone wrong
By James DeRuvo (doddleNEWS)
As you probably know, I like to post kickstarter campaigns under the headline “Crowd-funding projects we love...” and a recent one we highlighted was the Lightstrap, a case for the iPhone that had LED lights embedded into the back in a circle, that would act as a light ring for photo and video. It was a genius design and it had high hopes for coming to the market. But as this article indicates, the creators decided to end their Kickstarter campaign and close development, and the lessons they learned from a failed campaign may be even more valuable than the design itself.
I experienced one of those rare 'ah-ha moments' that every aspiring entrepreneur lives for: the moment of invention. The moment when your brain identifies a universal problem and generates a novel solution ...We ultimately produced Lightstrap, a stylish, easy-to-use and super effective ring light for iPhone.?But Lightstrap never made it to market. This is the story of why we cancelled our Kickstarter campaign and I'm writing this article so backers can understand the full story and new hardware entrepreneurs can learn from our experience. – Cassidy Clawson
As even the most successful crowdfunding campaigner will tell you ... not only is it a serious challenge to mount a campaign that reaches its goal, but all to often, even when you are successful, you end up falling short, because you either raised too little money, didn’t account for hidden costs and taxes to pay, or even declined credit card submissions from backers than can cause up to 25% of your fund to simply vanish. But the hardest part may be the campaign itself. And no matter how great your idea is, if you don’t approach your campaign with the right plan, you end up failing. This is what Cassidy Clawson discovered when he tried to bring the Lightstrap to market.
If we had done that, you'd probably have a Lightstrap in your hands right now and we'd be busy pushing the product to retail and developing exciting follow up devices.
I loved the idea of the LightStrap, and it’s a pity that it didn’t become a reality, because it could’ve probably made a fortune. But maybe what Clawson was meant to take away from the experience of trying to bring it to market through a Kickstarter campaign was even more valuable... both for him and us. Those lessons included:
- Kickstarter is Not a Business Plan
- That users have to Respect Kickstarter's Conventions
- That it’s vital to?Design for Scalability
- Timing is everything
Cassidy realized early on that his campaign was going to fail since he simply asked for too much money at the onset. “Our high goal offended many backers,”?writes Cassidy. “What we should’ve done?was reduce our Kickstarter goal to a minimum total that validates demand for the product.”
Cassidy says their calculation was based on what he calls “successful outliers,” and not on a realistic assessment of what works and what doesn’t on Kickstarter. By stating the goal smaller, they likely could’ve seen a much larger overall contribution, perhaps meeting their initial goal of $245,000. Having a successful Kickstarter campaign based on a more realistic goal would’ve enabled them to build on that success and court angel investors more easily.
Cassidy also learned that Kickstarter is a vast community of backers and that to shoot a campaign video that was too narrow in its appeal, actually alienated many who could’ve been interested in backing his project.
“... [Plenty of] users complained that the video was too narrowly focused on young people and nightlife,” Cassidy learned. “So we not only failed to recruit new backers, we violated the established cultural code of Kickstarter and alienated our actual customers … We should have looked in the camera, as is the Kickstarter tradition, and told our story in a simple and relatable way.”
But the other key was timing. Cassidy writes that, in retrospect, the timing in bringing the Lightstrap to market just wasn’t there. With a six month window after starting manufacturing and bringing the Lightstrap to market, Cassidy said he would’ve run out of money due to the time it would take to pay his manufacturers, wait for the built product, sell it, and then take the profits to move into the next generation designs. “...?our best-case projections showed us running out of cash due to the gap,” Cassidy writes. “Without significantly more capital to quickly push huge volumes into retail, we would be unable to pay for the development and manufacture of a follow up product.”
It’s a great read for anyone considering mounting a crowdsourcing campaign, whether for filmmaking or for producing a product that fills a need. And in the end, the harsh lesson is what it always is... to do your homework, copy what works, and to be realistic about what Kickstarter can and cannot do for reaching your fund raising goals. It’s a harsh lesson to learn, but it’s one that seems to be learned by Kickstarter campaigners on a daily basis.
http://player.vimeo.com/video/82582196
Hat Tip – Medium
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