Could you use some extra money to scale your online business? Do you want to test the marketplace demand for your physical product? If so, Kickstarter and Indiegogo are your tools and Zach Smith from Funded Today is your guide to raising capital for your business using crowdfunding.
Zach Smith: Doing real well. Thanks for having me on your show today, Robert.
Robert Plank: Cool, I’m glad you’re here, because this is a new topic that I don’t know much about, but I’ve seen it kind of take off. I’ve seen it get popularity. So crowdfunding, what the heck is it?
Zach Smith: So crowdfunding is basically a way to raise money, that over the last few years has become extremely popular. There’s a lot of different types of crowdfunding, but we’ll just cut out all of that. The part of crowdfunding that we focusing on is called rewards-based crowdfunding, and that means that people essential preorder new ideas on sites like Kickstarter and Indiegogo. So let’s say I’ve invented a cool new watch, and this watch does all kinds of fancy features. I might have a prototype of just one such watch. Well I film a video, I talk about this watch, I talk about how I want to bring it into mass production, and I tell people for $250 you can preorder this watch that I have on my wrist, and I’ll make one for you just like the one I have here, and then people pay $250 to get this watch. There’s no catches, there’s no strings attached. You don’t have to give up any equity in your business, and people do this to the tune of millions and millions of dollars. Funded Today, like you mentioned in your intro, has done that more so than anybody else in the world for thousands of different inventors now.
Robert Plank: Awesome. So you’re the guy to talk to. I’ve seen every now and then… Before the show started recording we were talking a little like, Indiegogo and Kickstarter, people have used that to bankroll movies and TV shows and stuff like that. Plus on the practical side, every now and then I’ll see something. I’ll see someone will invent a camera that allows them to talk to their pets and dispense pet food remotely.
Zach Smith: I saw that one, yeah.
Robert Plank: Yeah, that’s the most… That’s the one that comes to mind the most when I think of crowdfunding and Kickstarter type of stuff, but it’s also practical enough, something like a multimillion dollar movie and stuff like that. Using the watch example, someone says “I’m going to design the watch.” So what are the steps then? I guess they sign up for a site like Kickstarter, they make a webpage. I guess maybe they can make a prototype or a graphic, and then people can preorder the watch. So the thing that I was curious about as you were explaining it, let’s say that you, Zach Smith, say you can preorder this watch for $200. I preorder the watch and then what happens, because I’ve seen some of these say we need a hundred backers or something like that. What happens if they don’t get adequate funding for that project?
Zach Smith: Yeah, great question. As an entrepreneur, you want to know how much it’s going to cost you to build this watch, so let’s say that your MOQ, your minimum order quantity, is 1000 watches. You’ve talked to manufacturers, you’ve talked to suppliers, and we can help with all this stuff as well. We can help with almost anything, and because we’ve done this so many times, anybody who needs help with, oh I don’t know how to prototype, okay great. Oh I don’t know how to make a view. I don’t know how to do a design. We can help with all those different things, but let’s assume you’ve got all that covered, and now you’ve talked to all those people. You’ve done all that stuff. Getting the extra prototypes made is going to cost $10,000. Ordering 1000 of these watches, let’s say it’s $20 for each watch. That’s $20,000. You add up all your total costs, and that’s what you want to set for your goal.
Kickstarter has what’s called all-or-nothing funding, so on Kickstarter, that means if you set a goal for let’s say $100,000, that means that’s what it’s going to cost you to bring this watch into existence. That’s factoring in all the product you have to buy, all your costs of goods sold, whatever overhead you have, all your prototypes, and whatever it’s going to cost to deliver and ship the finished product off to all your preorder backers. That’s what you set your goal for. On Kickstarter if you do not hit that $100,000 goal, let’s say you’re $99,999, that means you don’t get any of your money, and so it’s very important that you set a goal as low as you possibly can so so that you can get funded, but then as high as necessary so that when you do get funded, if you don’t get whatever you need, you can still deliver it to your backers.
Kickstarter, I say particularly, that particular website, is a paradoxical vehicle in the sense that you might set a goal for $100,000, and until you get to $100,000 you might not get a lot of excitement and a lot of traction. Once you hit $100,000 the crowd engages and says “Oh wow, this is great. This is funded. This is going to happen” and then they get behind it and the momentum rolls, and it’s like a snowball going down a hill. That’s why I recommend setting a low enough goal that you can get funded really quickly so you can show that you’re successful to get that paradox of success to happen, and then you will really become successful. But again, you want to be careful, because if you set your goal too low and you only end up raising $50,000 when you actually needed $100,000, that’s a bit of a problem. So I always recommend setting your minimum viable goal so that you can create your product, but not setting a goal so high that it’s impossible to real, or it looks just so daunting to people and it takes many weeks or a month or so before it gets funded, and then you don’t ever get the momentum that’s so exciting about crowdfunding.
Robert Plank: Right.
Zach Smith: Does that make sense?
Robert Plank: Yeah, that makes perfect sense. If I were to go to your Kickstarter page, and you have this watch, and it says we need $1,000,000 raised and we’ve raised $100, I could look at that and say there’s 0% chance this is going to go through, but if you said we need $50,000 and the thermometer was at 60 or 70, I’m like, well great, they passed their goal. I can buy this and I’ll be guaranteed to get it.
Zach Smith: Exactly, yep. That’s exactly right.
Robert Plank: Let’s say someone set up a Kickstarter, they calculate their MOQ and stuff like that. As far as setting the goal and all that, do you recommend that your clients have any wiggle room, or is it just set the goal based on the costs, and then hopefully the Kickstarter will overfill, or whatever the term is?
Zach Smith: I think that’s a great question you asked. I think it’s very` important to add some wiggle room. Good examples of not having enough wiggle room are the Coolest Cooler, one of the most funded projects of all time. They didn’t factor in that it was going to cost a lot more when they went through all kinds of different change orders, and because of that they still have 50, 60% of their coolers that 3 or 4 or 5 years later, they still haven’t been able to ship out, however long it’s been. That’s just because they didn’t… Even though they raised $12 or $13 million, I forget the total number. That still wasn’t enough to deliver to their thousands of backers because of fancy and how amazing they ended up making the cooler. If you have a little bit of wiggle room, you avoid those issues.
Robert Plank: I looked up the Coolest Cooler while you were talking, and I’ve seen this recently, but I didn’t know that was the name. It looks like they had 62,000 backers pledge $13.2 million dollars.
Zach Smith: Yeah.
Robert Plank: Crazy, the amount of money some of these types of sites raise.
Zach Smith: He’s a good guy, too. People make him out to be like he screwed everybody out of things. I think he just kind of made some common mistakes of an entrepreneur. He didn’t set his margins right, he quite know what he should have charged, and he was way more successful than he ever planned. A lot of people don’t know, but he ran his first project and he raised $125,000. But guess what his goal was? $250,000. So guess what? He had to cancel it. He didn’t get any of that money. He relaunches, and look what happens. $13 million later, he doesn’t know what to do with himself, and he wasn’t ready for it to become that successful. Interestingly enough, one of the most successful crowdfunding projects of all time on paper, it has been one of the most unsuccessful crowdfunding projects of all time in practice.
Robert Plank: Oh no! Have you seen this happen over and over again, or does it go right more than it goes wrong?
Zach Smith: I’d say it goes right more than it goes wrong. We’ve worked with lots of creators, and I’ve worked with a few creators. I love Jon Richards and Jacob Durham. They’re a couple guys out of Utah, where I’m from. These guys have done four or five crowdfunding projects now, and they’ve all been successful. They usually fulfill on time, if not earlier, and because of that they just got done running a product called NOMATIC. It’s a bag that has all kinds of different features. It’s pretty amazing. Nomatic raised over a million dollars. This is from two guys that came to me two or three years ago wanting to raise $10 or $20 thousand for a wallet. We ended up raising $171,000 for the wallet, then we raised money for a notebook, then we raised money for a laptop stand, and then they did really well on their own with this NOMATIC and brought us on at the end, and we did pretty well raising the money for their bag as well. You can have stories like that where you keep coming back to crowdfunding because your backers love you, you build up that customer lifetime value, and everything new you invent, everybody wants to be a part of, because you’ve created that tribe, as Seth Godin likes to call it.
Robert Plank: Nice. So is that the secret to getting a campaign to… By the way, what’s the term for if a campaign completes or whatever?
Zach Smith: Yeah, funded is what we like to call it. That’s why our company name is Funded. Funded Today.
Robert Plank: Today, not tomorrow, because tomorrow is too long to wait, right?
Zach Smith: Well, we got Funded Tomorrow too, when you raise enough money with us, we take you over to Indiegogo inDemand, and we raise you more money tomorrow, too.
Robert Plank: Oh nice. So it’s today and tomorrow.
Zach Smith: Yes sir.
Robert Plank: That means you cover all the bases. Is there a secret to getting a project funded? Is it a matter of building up these followers? Is there any amount of outside traffic involved? What’s low hanging fruit there?
Zach Smith: Yeah, the secret is… And again, there’s no secrets really. I mean, it’s obviously a secret I guess, because not everyone can do it, but the secret is putting in the work. It’s hard work. In order to get really successful on Kickstarter particularly, and I’m talking about Kickstarter generally, but I mean crowdfunding holistically, because Indiegogo is the same sort of thing, but everybody is a little more familiar with Kickstarter. Indiegogo has a couple different things than Kickstarter. For example, in Indiegogo you can choose flexible funding and you can keep all of the money that you raise. You can set a goal of 50 grand, but if you only raise 48 grand, you get to keep it all. Indiegogo likes that. I’m kind of torn on it, because if you don’t get the money you need, how are going to go and get the extra money so you can make sure you fulfilled your backers.
Robert Plank: Right.
Zach Smith: But maybe if you get close enough, you can get a little bit of capital or self-fund a bit and deliver. It seems to work for Indiegogo, but I’m kind of 50/50. I like the idea of setting a fixed goal. The other reason I like that too, total divergent here, is because if you can’t raise the money you need, it probably means you don’t have that good of an idea, right? Or you haven’t marketed it right.
Robert Plank: Right.
Zach Smith: So if you can’t raise the amount of money, you probably shouldn’t bring the product into existence, because that means the market doesn’t want it. That’s a whole other topic. In terms of what you do to raise money, You need to start out just like you would in any other business, just like they teach you if you’re going to be an insurance agent or salesman or something. Start with your friends and family and tell your friends and family, “Hey Robert, I’ve got this amazing idea. It’s this cool watch. Here’s what it does, and I’m going to be launching it on September 22, 2016 at 11 o’ clock AM Eastern Standard Time. Can I count on you to give me $200 at that time to back this?” “Oh yes, for sure I’ll do it!” Right?
Everybody has friends on Facebook or Twitter or Instagram. Contact every single one of those people privately. Build up the spreadsheet. Use a Google Spreadsheet. Use a Google sheet or a Google doc. Write them all down, commit them all, get their names, emails, phone numbers, and don’t just let them tell you it’s cool, it’s a great idea, because everybody is going to tell you that. Really ask if they’d pay money for it. If they wouldn’t pay money for it, say “Be honest with me. If you really can’t buy this from me, why, why not?” You’ll kind of get a good idea if you have a good idea or not. There’s it all from your friends and family. Once you have them committed, try to get 200 or more. The reason why is because the day you launch, if you have 200 or more of your friends and family, there’s a good chance that you’ll pop to the top of Kickstarter, and when you pop to the top of Kickstarter’s popular and magic rankings, you get millions of eyeballs on your page. When you get millions of eyeballs on your page, if your idea truly resonates, you could have what we like to call a supernova, which is a good product and good marketing. Factored into Kickstarter’s algorithm, that results in millions of eyeballs and thousands of pledges on a product. All you had to do was sign up a few friends and family.
Robert Plank: Nice. That’s cool, so you have your launch team or whatever you could call it, which is your close friends and family, and they all buy right when the thing opens, get it ranked, and then get noticed and going on from there. Is there a way, or do you know off-hand, is there a way to… I’m even kind of afraid to ask this, but is there a way to pay people to buy your Kickstarter, or is that too black hat for them?
Zach Smith: That’s a good question. To gain the system, I see what you’re saying. I don’t recommend doing that. Kickstarter is really good too at… They have what they call an integrity team. They look at a lot of things like that. The other reason I don’t recommend it, even though it is a good idea and we’ve thought about it, but we ultimately decided not to, because if you don’t have a good product, paying people to buy it isn’t a good idea because no one is going to buy it when it ranks in popular anyway. You want people that actually want your product, and you want legitimate people seeing it and ready to buy.
Let’s say you don’t have that many friends and family. Let’s say you maybe don’t want to do the work. That’s why a lot of people come to Funded Today, because we have a network of thousands and thousands of people, and we can tell those thousands and thousands of people about your product, build you up an email list, get them ready to go, and tell them the day you launch, and then they will back your project. Or while doing that, we’ll let you know if you have a good idea or a bad idea before you even launch. Hey, nobody wants this. We can’t anybody to sign up or opt in. You probably shouldn’t go any further, and you won’t waste the rest of your life chasing an idea that people don’t want. Does that make sense?
Robert Plank: Oh yeah. That way they can move on to something that does make money.
Zach Smith: Exactly. So many people chase their dreams without ever taking action. Crowdfunding has made it so that you can quickly chase your dreams, figure out if it’s right or not. If it’s wrong just a little bit, you can pivot, or if it’s completely wrong, you can move onto something entirely different and make money, and create a good job or create a life you want to live. Sometimes it’s not your first idea, it’s your second. Not your second idea, might be your third or fourth idea. We have guys that come to us the fourth time, and finally we’re raising them hundreds of thousands of dollars. Where their first, second, third ideas were complete failures, we didn’t raise them any money, even knowing everything that we know and having access to everything that we have access to.
Robert Plank: Right, so it’s like they had to go through those failures and get those ideas out of their system to get to the good stuff that people actually wanted.
Zach Smith: Exactly. We call it product validation, and Kickstarter provides the best possible way to validate an idea than I’ve ever seen. You have everything there.
Robert Plank: Right. It sounds like it puts the funding people need with their businesses within reach, whereas before they would have to… Like in the 90s they’d have to go to some venture capital meetings or –
Zach Smith: Oh, you’re so right.
Robert Plank: They’d have to to go on Shark Tank, or there’s always all the stories about people who spend 30 years just making $0 trying to get on the shelf at Walmart, and after 30 years they finally get it, and now they have to come up with 10 million units and they just totally go bankrupt. It’s like your reward for 30 years of waiting was bankruptcy.
Zach Smith: Your pitch you just said there is exactly the pitch why I believe crowdfunding is the new economy. We are literally branding a new economy. You no longer have to have a rich dad, rich family, rich uncle, venture capitalists, angels. You can literally bring an idea for the crowd, get your friends and family involved, and let the crowd decide if you’ve got a winner or not.
Robert Plank: Nice.
Zach Smith: It’s powerful.
Robert Plank: That’s some internet democracy right there. We mentioned a couple of platforms like Kickstarter, and there’s Indiegogo. Are those the top dogs, or are there any others?
Zach Smith: There’s others, but I’m the biggest in the world, and I don’t know who they are.
Robert Plank: So why bother, right?
Zach Smith: Exactly. 80/20 is what I preach quite a bit, and you want to be on Kickstarter if you’re raising money, and after you want to go to Indiegogo inDemand. That’s the process.
Robert Plank: So why is that? Why Kickstarter first, and then Indiegogo?
Zach Smith: I love Kickstarter. I love Indiegogo. I love Indiegogo a hundred times more than I love Kickstarter. They’re just such a good company, so many nice people, but for some reason their platform just doesn’t convert as good as Kickstarter. Kickstarter is a lot bigger, so Kickstarter has a lot more traffic, and so if you have a good idea, going on Kickstarter you’re going to raise more money, but Indiegogo is going to treat you way nicer. So if you want to be treated nice, have amazing customer support, all kinds of help, all the bells and whistles, everything for you, and maybe you don’t have the best product ever but it’s good, Indiegogo is going to be your best bet.
Robert Plank: I’m trying to figure out if I’m understanding you right. When you say Kickstarter then Indiegogo, do you mean launch your product on Kickstarter and then once that’s done, launch it on Indiegogo, or are you saying –
Zach Smith: Yes, that’s correct.
Robert Plank: Okay. So you can take the same offer and do the Kickstarter launch first and then the Indiegogo launch.
Zach Smith: Yeah, so what you do is you launch a Kickstarter project, and then once your Kickstarter project is over, you go to what’s called Indiegogo inDemand, and Indiegogo inDemand is simply a way for you to continue to take preorders while you are in that final protyping manufacturing fulfilling stage for your Kickstarter. You set your shipping date back a couple months, you charge a few bucks more for your price, because obviously people didn’t take action on Kickstarter so they have to pay a little bit more, and then you continue to raise money for your product, and you get it closer and closer to what you’re going to charge for retail pricing instead of the early bird pricing, so it gives you even more time to validate, more time to raise money, and more time to cover your overhead as you go about building your new business.
Robert Plank: Nice.
Zach Smith: It’s pretty powerful, and Indiegogo is way better than Kickstarter at that.
Robert Plank: That all sounds like a kind of cool strategy.
Zach Smith: It’s amazing.
Robert Plank: So if someone is either on Kickstarter or Indiegogo, and they calculate all their costs, and they list their product, and they have their initial sales, and they get a bunch of backers, and let’s say that the project gets funded. Is there a way to back out? Like you said in that once situation where the cooler raised $13 million, he was totally overwhelmed. If Ryan had decided that he just didn’t want to deal with it, is there a way to just hit a cancel button and refund everybody, or is that not a thing?
Zach Smith: Yeah, you absolutely can. Now Kickstarter is going to charge their fee, and Kickstarter and Indiegogo both charge 5%, and so you’re not going to get that back. Kickstarter is not a store, so when you back a project on a crowdfunding site, even though I call it a preorder because that’s an easy way to understand, you’re not preordering, you’re preordering the idea should it come into existence. Like I said, most of the time they come into existence, and they’re usually pretty good. Sometimes they don’t happen, or they don’t materialize, or other unforeseen costs happen, just like when you invest in a normal product and it doesn’t work out. Kickstarter is not a store. They are a place for people to try to bring new invention and new innovation to life. I’ve seen a lot of creators refund, but you usually won’t get back all of your money because Kickstarter takes their fees. Obviously the creator probably spent a lot of money trying to build out the product or do whatever they could to try to make it happen, and so if they were to not ultimately fulfill, you’d be out whatever money that is.
Now that’s one thing we created to mitigate that because sometimes the risks to back a project, especially if the project seems really crazy or really tacky or intense, it’s like wow, how are they going to really pull this off? Like Oculus Rift, it just sold for several billion dollars to Facebook. It was one of the first crowdfunding projects ever. They took three or four years to deliver, and I think they’re finally delivering. They ultimately delivered, but look how long you had to wait. What we’ve done to mitigate some of that risk, because we’ve created something that we call the Cashback Network. The Cashback Network is a place where you can go and back projects and get 10% cashback on everything that you back.
Robert Plank: Now how does that work? How are you able to pull that off?
Zach Smith: Because we work with tons of projects on Kickstarter and Indiegogo. Any project that’s in our network, we simply give a kickback of what we’re charging to all of our backers to mitigate their risk for backing.
Robert Plank: Nice.
Zach Smith: It’s a win-win-win for everybody. The backers love it because their risk is mitigated, and they get a deal, and like I said, it’s not too risky. Most people deliver. Literally every client Funded Today has ever worked with has delivered a product. We have a lot that haven’t delivered yet, but all signs point that they’re going to deliver. We have a pretty good track record, and since we work with lots of the big projects, I think it’s safe to say probably 80, 90% of projects you back are going to deliver. They might be slower because obviously these are new businesses, and when they get injected with tons of capital, sometimes it’s a bit confusing or crazy, but there’s a lot of good stories too. Literally my entire wardrobe is from projects that we’ve raised money for. It’s pretty cool.
Robert Plank: Awesome. With all that stuff, is there any kind of legal risk? If there is a Kickstarter or something, and someone buys it, and let’s say that it’s late or it’s inferior or it catches on fire or something. Is there any kind of protection on Kickstarter’s end for that?
Zach Smith: Yeah. There’s a lot of legal risk. If a project doesn’t deliver, I’ve seen quite a feel backers combine together and form class actions. I saw a case that I was reading yesterday about… I can’t remember what project it was for, but a bunch of backers got together I believe in the state of Washington, and they ended up winning, and I believe they got trouble damages, so if you try to screw the backers and you don’t even make any attempt at actually delivering, you’re going to pay the price. There’s some pretty good laws in place to help that out, and fortunately Kickstarter does a good job with their integrity team. We have our own internal integrity team to make sure the projects we’re working with are going to legitimately deliver.
We like to require a prototype, so we’ll look at and review a prototype of any product that comes our way to make sure it does what they say it’s going to do so that we know they’re going to be able to do it. Now will they be able to do it en masse? That’s always the question, but generally if they get a prototype down, there’s a good chance they know how to build it out massively as well. But there is a risk. If you don’t deliver, if you’re trying to screw people, people will take action, and fortunately the Kickstarter ecosystem is pretty good at finding those before, and Kickstarter does a great job at suspending them. We’ve worked with probably 5 to 10 projects that have been suspended because they were doing different things. They were either reselling products, not inventing something new, or probably blatantly trying to rip off money, but Kickstarter has pretty good ways of catching that, even after they start raising lots of money, so you definitely have to have a legitimate idea and have plans for how you’re actually going to go about fulfilling or you could be in trouble, even if it’s five years down the road.
Robert Plank: Fair enough. It is a little scary, but I guess it’s no more risky than anything else on the internet as far as physical products and stuff, right?
Zach Smith: Yeah, I mean the risk is… And again, Kickstarter has something called the prototype category, so any product you back in the design category, you can look at all of the prototypes and see what you think can this really happen. You’re kind of an investor in a way. I don’t think Kickstarter calls their backers investors, but in a way you’re kind of an investor, but your investment is being able to get the product before anybody else, and saying that you helped bring something into existence, and having the joy of helping an entrepreneur realize the American dream or something, right?
Robert Plank: Yeah. Thanks for clearing that up too a few minutes ago, because I didn’t even realize that Kickstarter and Indiegogo are investing site, that they’re not stores. This whole time I was thinking that people go and they just click and buy their little doodads here and there, but it’s making a lot more sense to me now. The find a project, they read all the stuff, and if they believe in not only getting the item, but also in the person who’s making it, then they can provide that support in that way.
Zach Smith: Exactly, yeah. That’s right.
Robert Plank: I’ve seen a lot of the… I don’t know what you’d call… The prototypes, physical products, e-commerce kind of stuff where they’re making an item, and I’ve also seen some of these weird Indiegogos where people say like, help me pay my hospital bills, or pay me $5000 for me to go to a cabin and write a book. Have you seen those? What’s your thoughts on those?
Zach Smith: Those are more on a site called GoFundMe. Maybe there’s some of those on Indiegogo, I’m not quite sure. We don’t work with projects like that. I love charity, don’t get me wrong, but I believe you got to have a product that stands strong, and then leverage those profits from the product to go ahead and do charitable good. So look at Facebook. Facebook makes most of their money from Facebook, but look at all the cool stuff they’re doing. Same with Google. Google makes 80, 85% of all their revenue from Google search, but look at all the amazing stuff Google is trying to do on the charity end. Don’t create a charity and ask people to throw money at it. Create an amazing product and then use the money from that amazing product to go ahead and do charitable good. People don’t want to give money to those kind of things. And there’s so many. Use a site like GoFundMe and get your friends and family involved in something like that. I don’t think the crowd is going to go crazy. But then again there’s always the one that raises a million bucks and every talks about. Look at this guy, he wanted to start a lawn mowing business, and everybody loved his story so much that he made a million bucks. There is those stories, but those are one in a million, and that’s just the nature of virality.
Robert Plank: That makes sense. I’m sure that someone out there has made it work, but for the average person not very likely, not very practical as opposed to creating something that provides value. Even that you mentioned Facebook making the drones that provide internet to Africa and stuff like that. The amount of money that Facebook and Google pour into the charity stuff, they would never have raised that amount of money just asking. The only reason they can provide that amount of money is because they built their own company, and then they choose to allocate those funds. That’s cool. As we’re winding this town, let’s talk about Funded Today, because that’s come up a couple times, and it sounds like you guys provide an all-in-one solution, and all the stuff in there that makes Kickstarter campaigns a lot safer, more reliable, and likely to succeed. So can you tell us about Funded Today and what it is?
Zach Smith: Yeah, so Funded Today is an all-in-one crowdfunding marketing agency. We can do everything. If you have an idea in your head and that’s all, come talk to us. If you’ve got everything ready and a video make and a page designed and you’re ready to push go but you don’t know how to make money or you don’t know how to launch, contact us. We’ll chat with you. If you’re all the way into your project and you haven’t raised any money yet and you think you maybe have a good product, we have something called the crowdfunding success matrix. You can link to this in your podcast if you want, but it’s basically just a little matrix, just like you see in business school.
There’s four quadrants. Outer darkness, black hole, shooting stars, and supernovas. You might be a shooting star, where you launch well, all your friends and family liked it, they backed it, other people backed it, but then your marketing died off, so it’s just like a shooting star. It’s fleeting, it goes away. We can turn a shooting star into a supernova, and a supernova is a good product with good marketing. A shooting star is a good product with bad marketing. A black hole is a bad product with good marketing. You’re just throwing money in and it’s getting sucked away. Outer darkness is where you definitely don’t want to be. That’s a bad product and bad marketing. If you have a shooting star, my most recent example that I love sharing is a guy named Timo Heino from Finland with a product called SpineGym. He came to us when he had 41 backers, probably his friends and family, and $8047 raised. If you look up his project on Indiegogo inDemand now, I believe we’re at $1,300,000. We raised him $463,000 on his Kickstarter, so 463 minus 8,000 over $450,000 raised for this product that was pretty much dead in the water. It had a little bit of a shooting star and then it died.
At any stage of the crowdfunding process we can help you raise money, it just depends on where you’re at. Worst case, we’ll validate your product, and we’ll tell you, look, we’ve raised millions and millions of dollars and we did the exact same thing we’ve done for all these products that we’ve raised millions of dollars for, but for your product it didn’t work. So chances are you’ve got a bad product and you probably need to pivot or tweak or disband, and here’s some things we recommend. Or you know what? You’ve got a terrible idea. Nobody wants it, and as hard as this is for you to accept, it’s time for you to move onto something new or go get another job, because this one’s not going to do it for you.
Or best case, we turn into a supernova and we do what we’ve done for the $80 million plus we’ve raised for hundred of good Kickstarter projects, and everybody’s happy. Those are my favorite. We have a lot of them right now. We have the second most project on Kickstarter running live right now. It’s called Flag, a really cool idea for photo sharing, and we have probably 5 to 10 more in the top 20 on Kickstarter, and tons on Indiegogo inDemand. We’re Indiegogo’s number one partner, we’re Kickstarter’s number one source of traffic aside from Youtube and Google. We even pass up Reddit most of the time. We’re doing big things, and we’re working with big companies. We’ve worked with lots of big names. We worked with the guy that invented Furbee. We’ve worked with Samsung. We’ve worked with the Coolest Cooler guy on quite a few things. Baubax Travel Jacket, the fifth most funded project of all time. That’s Funded Today. Hiral Sanghavi is a good friend of mine. I could name drop all day with all the random stuff we’ve done, but we’re doing big things and it’s exciting, it’s fun. It’s great to see these new ideas get brought into existence when you get to be a part of it.
Robert Plank: Nice. Who knows, maybe someday you’ll be bigger than Kickstarter and you can start your own, right?
Zach Smith: I don’t know. We’ve thought about it, you know?
Robert Plank: I’m looking at the site, and you guys have like $80 million total in funds raised in all kinds of cool stuff. What’s the website? What’s the address to get to you and your company.
Zach Smith: It’s funded.today. We also own fundedtoday.com, but I think that just redirects to funded.today and the reason we do that is because we get your project funded today. Pretty easy to remember, but it’s not a dot com domain name. A lot of people mix that up. We went with something kind of weird with all those neat domain extensions.
Robert Plank: But weird stands out.
Zach Smith: Hey, exactly.
Robert Plank: Cool, so funded.today and before I let you go, do you have off the top of your head a super weird and crazy successful project that you’ve backed with Funded Today?
Zach Smith: That is a great question. Let me scan our site real quick. I’m going to do what you do.
Robert Plank: Cool.
Zach Smith: So we’ll just go to Funded Today. If you go to the Get More Pledges page, you can scroll down and see a ton of the testimonials. We try to get a video testimonial from every client too, so we have lots and lots of video testimonials. People are slow to give them, but they all eventually come in. I think we’ve got 30 or so on the site. Let me find one that I really enjoyed. You know, I like the BetterBack. The BetterBack comes to mind. I use it almost every day. It’s sitting on my desk right now. It’s a product invented by Katherine Krug. It raised $1,193,776. It’s an apparatus you wear for 15 to 20 minutes a day. It helps you maintain perfect posture. In fact, I’m not wearing it right now as I’m doing this interview, and I lean back, deep in my chair, horrible posture. Katherine would be ashamed of me. I should probably be wearing my BetterBack. It’s a cool product that I don’t think anybody has ever heard of or seen. I really love it, and it’s very well made too. It was better than you even expected when you backed it.
Robert Plank: I’m scrolling through, and I’m seeing the BetterBack. People are selling wallets and clothing items and shoes and sunglasses, all kinds of stuff. It’s crazy the amount of money that people are raising with some of these sites, especially when they use Kickstarter plus Indiegogo plus Funded Today and all these other tools that are out there. So look at all the great ideas that people have and all the money flying around. I think that anyone would be silly not to use crowdfunding to fund their physical projects and things like that. So once again, that webpage is funded.today, and thanks a bunch Zach for stopping by and telling us all about the exciting world of crowdfunding.
Zach Smith: Thanks Robert. I appreciate it. Glad to be on.
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