Crowdsourced funding? Better manage your expectations

Publish Date: 
Jan 16, 2014
By Beth Dolgner

IT SOUNDS EASY. You are passionate about your product idea, and there are plenty of passionate motorcyclists out there in cyberspace. They all kick in some money to fund your endeavor, and if you meet your fundraising goal you can launch your product.

The reality can be much different.

Kickstarter.com is among the top sites for what has become known as crowdsourced funding or crowdfunding. A look at the statistics for Kickstarter shows that the outcome does not always match the expectations. As of early January, there were 130 Kickstarter projects tagged with the word motorcycle. Of those, four were still active campaigns. Of the 126 campaigns that had already ended, only 32 had been successfully funded.

That means only 25.39 percent of past motorcycle-related Kickstarter campaigns were successful.

These numbers are surprisingly different from the overall statistics for Kickstarter. Of the 127,483 projects that have been launched, 43.71 percent have been successful.

Of the 130 motorcycle campaigns mentioned above, many of them want funding for their own touring adventures, documentaries or historical books. The options run the gamut from new technologies to biker-themed novels.

Indiegogo.com, another popular funding site, has an even more eclectic assortment of motorcycle-themed fundraising campaigns and an even lower success rate. In one campaign, someone simply wanted a new motorcycle and lacked the money to buy it. There were no perks offered to anyone who was charitable enough to chip in (not surprisingly, there were no contributors).

WHEN IT WORKS
Successful Kickstarter campaigns for the powersports sector mostly fall into one of three categories: documentary films, books and aftermarket parts or accessories. MuzaMoto raised more than $10,000 for bolt-on, bar-end turn signals. At the opposite end of the spectrum, Nathanael Cole far surpassed his $7,000 goal to fund his tabletop role-playing game, Motobushido. Featuring battles between samurais who ride motorcycles, the game ended its run with $11,400 pledged.

Vololights is another motorcycle product that was successfully crowdfunded. Vololights are the creation of Vectolabs in Oceanside, Calif. Vololights is an LED-equipped license plate bracket that contains a three-axis accelerometer and microprocessor to detect deceleration. Whenever the motorcycle to which the bracket is attached slows down, the LEDs automatically illuminate to alert other drivers. Vololights have a varied flashing rate depending on the rate of deceleration.

The company’s campaign ended in June 2013 with 441 people donating a total of $53,886.

Jesse Szynal, director of sales and marketing for Vololights, says that while Kickstarter is a great platform for raising money, there is still a lot of old-fashioned hard work that has to be done to make a funding campaign successful.

“We developed an extensive list of media contacts, from PR reps to bloggers to traditional news media types. Cold calls, emails and social media invitations were all part of the outreach program. We also decided to run a release on the popular PR Newswire service, and that helped garner additional traction,” Szynal says.


Producers of upcoming Penton film reveal Tom Fritz painting as part of a rewards program for its Kickstarter supporters. Click HERE for the story.


Had the Kickstarter campaign not met its $50,000 goal, Szynal says that Vectolabs would have turned to a more traditional method: fundraising through family and friends, and seeking outside investors.

But Szynal notes that Kickstarter has benefits other than raising money.

“The website is a great platform to gauge interest in new products and to allow for active discussion in additional features that should be included in the production unit,” he says. “From backer input, we decided to add a stealth setting (no flash mode) in addition to making a modular version for different-sized license plates. Had we gone the traditional funding route, we would not have had this direct customer feedback to incorporate additional features.”

Products that increase rider safety are a popular theme. Consider the Banshee Horn. Designed by Screaming Banshee as a complement to the stock horn on a car or motorcycle, the Banshee Horn uses a 139dB compact air horn to alert other drivers while simultaneously pulsing the high beam. A rider can push the horn button quickly to use the stock horn, or hold the button down to activate the Banshee Horn. The Tampa, Fla., company hatched the idea for the Banshee Horn after inventor Peter Olt had a close call on his own motorcycle and recognized the need for something louder than the stock horn. 

Apparently, other motorcyclists agreed: Screaming Banshee sold more than 450 Banshee Horn systems as incentives for Kickstarter backers. Screaming Banshee set its funding goal at a mere $12,000, but the company far exceeded it with 315 people pledging $30,047.