Have you recently seen how OUYA more than quadrupled their funding on Kickstarter AND THEN got into mainstream retailers like Target, even before they’ve manufactured? Did you too become dreamy-eyed at the thought of national success? You’re not alone. Yet the reality is there are A LOT of products being created right now and while many will prove demand and raise more than enough capital, a mere fraction will be lucky enough to find their way to store shelves. And this they must.
Easy access to crowdfunding platforms like Kickstarter or Indiegogo allow anyone the opportunity to get an idea funded. And the demand for great products is there. 17 Kickstarter projects raised $1 million or more last year, several of them gadget projects. Countless more raised far beyond their original ask. Yes, we live in exciting times.
But, retailers need more. They need to know the product has enough market traction to scale and become successful. Platform businesses like Daily Grommet and Quirky acquire that necessary market intelligence on new products and companies. Within 24 hours, our team knows whether a product we launch has “legs.’’ But it takes weeks or months to be sure that the company is robust enough to swim with the sharks of big retail. We’re also motivated to share that data — that’s unheard of in the traditionally secretive retail world.
So many of these crowdfunded campaigns won’t ever get to see past initial concept, or prototype stage, even with buckets of money. Campaigners don’t always realize, but there’s a lot more work to be done getting these products to market. Just because you knock it out of the park with crowdfunding, doesn’t mean can properly manufacture and scale. And I’m not saying funding is easy. It’s not. It’s hard work. But it pales in comparison to the heavy lifting of getting it scaled and into distribution.
A successful Kickstarter campaigner, Nathan Rothstein of Project Repat says, “Kickstarter alone can’t give you enough runway to get airborne. Anyone can make a popular crowdfunding video. The real test becomes: can you fulfill your funders in a timely manner and turn them into brand evangelists? If not, you’ll just have a nice kickstarter video, with no customers.’’
Skooks Pong, of Synapse Product Development says “When it comes to hardware, product development experts will tell you that the biggest challenge isn’t fundraising, but actually developing the product at scale and seeing it through to market.’’
The data says it all. Kickstarter can create a product, but it needs to become a successful business to survive.
So what’s a campaigner to do? First, recognize that you need more. Among other things, you need a launch platform that can give you the audience and support to scale. At Daily Grommet, we’re launching many of these worthy post-crowdfunded products every day. Examples of our Kickstarter Grommets include SushiQuik and COOKOO; both who surpassed their original funding goals.
Daily Grommet recognized the markers of success in these product concepts and curated them using our four years of pattern recognition. Then we provided them with a ready-made consumer audience who wanted to learn their story from a trusted source.
Kickstarter can get you started; but call us when you’re ready to become a business.
Jules Pieri is founder and CEO of the product launch platform Daily Grommet. Weigh in on The Exchange: Let us know whether you think crowdfunding tools like Kickstarter can offer startups long-term sustainabilityat email@example.com or on Twitter at @HiveBoston. And read other responses here.