Crowdfunding & Crowdsourcing
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© 2013, All rights reserved HiveWire Inc. 2
About Us
Christopher Charlesworth Co-Founder
Asier Ania Co-Founder
Kris Olafson CTO
Moira Klein-‐Swormink Finance
Arthur Prevot Data Scientist
Jean-‐François Obregon Marketing
CSI’s Catalyst
Platform CSI’s Catalyst
(powered by HiveWire)
Platform Type Rewards Based PlaForm
Differentiation People creaHng a beIer world
Real World Community Extra Support
Partners: Centre for Social Innovation
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www.csiCatalyst.org @csiCatalyst
The exchange of value between you and the crowd
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Crowdsourcing:
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What is: Crowdsourcing ?
CrowdFunding: Fund something
~$300 M in funding in 2012
CrowdWisdom: Solve a Problem 75% of people in the crowd
already knew the soluMon.
CrowdVoHng: Select something
Very basic and employed by many sites
CrowdLabour: Complete tasks Millions or workers
compleMng simple tasks
CrowdCreaHon: Create something Army of graphic
designers at your service
CrowdAdvocacy: Support something People-‐powered poliMcs to
decision making.
Case Study:
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Crowdfunding 101
What is Crowdfunding
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Crowdfunding is the aggregaMon of small amounts of money from a large group of people via the internet in order to fund something (business, project, etc.)
Four Types Equity Ownership / Profit Sharing
Lending Percent Return (peer to peer or aggregaMon)
Donation: Non-‐tangible feel good return.
Rewards: Non-‐monetary Returns (e.g. t-‐shirt, product, lunch with founders. Legally a donaMon.)
Rewards Crowdfunding
Keep What You Raise Ø You keep the total you have raised
regardless of reaching your target
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All or Nothing Ø You only get the money raised if you
reach (or exceed) your target
Two Rewards Models:
Who is Crowdfunding ?
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Source: 2013 Crowdfunding Industry Report, MassoluMon
Social Causes 18%
Business & Entrepreneurship
16%
Films & Performing
Arts 18% Music &
Recording Arts 11%
Other 29%
Fashion 8%
Most AcHve Categories (Rewards-‐based)
Key Factors of Success
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Quality Idea & Pitch
Strength of Your Network
EnHcing Rewards
MarkeHng Campaign
Rewards
Types of Rewards
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RecogniHon: • Examples: twicer menMon, email thank you, name
posted somewhere, name in credits, etc. Things: • Examples: pin, t-‐shirt, CD/DVD, signed photograph,
prototype of your product, your finished product, something unique, etc.
Services: • Examples: your specific service, dance lesson,
workshop, etc. Access: • Examples: advanced Mckets to a conference or event,
limited access to a launch party, etc. Experiences: • Examples: help build project, apprenMce for a day,
chat, lunch with the co-‐founders, a character named afer you, etc.
$25 Most Popular Reward
$50 -‐ $70 Average Reward
$100 Most Money Comes From
At what reward levels do most people give?
Why do people Crowdfund ?
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Source: 2013 Crowdfunding Industry Report, MassoluMon
Why Crowdfund ? Ø Money Ø MarkeMng & PromoMon Ø Market ValidaMon Ø Connect with audience/customers
Key Takeway: It’s not just about raising money!
Platforms
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Sources: 2013 Crowdfunding Industry Report, MassoluMon, HiveWire Data
Industry fees typically range from 2% -‐ 9% + Payment gateway fees
Case Study
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Case Study: Tell your story
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TELL YOUR STORY
“Stories add meaning and meaning ignites acMon.”
“Make people feel your message not just understand it.”
-‐Terry O’Reilly
Rewards
Why people would back you
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• Cool Rewards: • People love to get something!
• Shared Passion: • What you’re doing can resonate with others
• Solidarity • Part of a movement
• ParHcipaHon: • Part of a collecMve goal
• Kindred Spirits: • SupporMng an entrepreneur in a similar field as the backer
• Etc.
Key Takeway: Know your target audience!
Marketing: Getting ‘eyeballs’ !
How do you get the word out?
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• Friends & Family • Mailing Lists • Important Nodes • Digital Media • Direct personal emails, Facebook, TwiIer • PR • Word of mouth • STRATEGY & PLANNING !
Key Takeway: It takes a lot of effort!
Campaign Content
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TEST and Iterate! • What:
• Video: Is it compelling, does it make sense. • Rewards: Are they enMcing, are they at the right levels • MarkeMng: Is it working?
• From Who: • Your close friends and family (they will spend the Mme) • People within your industry (it should resonate within) • People outside your industry (anyone should understand it) • Your BACKERS! (idenMfy why they backed and use/iterate)
www.csiCatalyst.org
CROWDFUNDING �FOR A BETTER�
WORLD�
@csiCatalyst
Workshops: bit.ly/csiCatalyst
Questions?
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215 Spadina Ave, Suite 425 Toronto, ON
Canada M5T 2C7
[email protected] Twitter: @HiveWireCA
Thank you.
Appendix
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Success & Failure
Most Failures are BIG
Only 10% raised 30% of goal Only 3% made it to 50% of goal
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-‐
2,000
4,000
6,000
8,000
10,000
12,000
Num
ber o
f Cam
paigns
Campaign Category
Campaign Volume and Success Rate (Kickstarter, 2012)
Campaigns Launched "Campaigns Successful"
Sources: hcps://www.kickstarter.com. Dynamics of Crowdfunding, Ethan Millick, Wharton School
Case Study: Documentary Film
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Case Study: Market Validation
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Case Study
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Success & Failure
Worldwide ~50% of all campaigns Fail
(sig. lower for keep what you raise)
Kickstarter Category Success Rate 26% -‐ 74% Overall Avg. Success Rate ~ 44%
Most Failures are BIG Only 10% raised 30% of goal
Only 3% made it to 50% of goal
Most Successes are small Majority only exceed goal by 10-‐13%
Success: Challenging to Create
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-‐
2,000
4,000
6,000
8,000
10,000
12,000
Num
ber o
f Cam
paigns
Campaign Category
Campaign Volume and Success Rate (Kickstarter, 2012)
Campaigns Launched "Campaigns Successful"
Sources: hcps://www.kickstarter.com. Dynamics of Crowdfunding, Ethan Millick, Wharton School
Market Categories
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$460 $676
$979 $1,430
$50 $89
$116
$166
$317
$555
$1,170
$2,123
$16
$62
$383
$1,344
$12
$74
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
2010 2011 2012 2013 (EsHmated)
Millions of U
SD $
Growth in funding Volume
Mixed Others
Reward
Lending
Equity
DonaMon
800+ $5.1 bn
81%
Plaqorms worldwide
2013 est. worldwide
Growth in 2012 (64% in 2011)
0.8 Bn
1.4 Bn
2.7 Bn
5.1 Bn
Sources: 2013 Crowdfunding Industry Report, MassoluMon, HiveWire Data
Case Study:
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Fraud: Kobe Red (Beef Jerky)
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Campaign Content
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CS examples • Dribbble.com:
• Your • Tongle:
• Your