Crowdfunding has helped entrepreneurs reach goals and provide some amazing products to the masses. There are countless success stories out there, and it is the main reason why so many people still focus on crowdfunding to this day.
While success should always be celebrated, Joe Parker of InventureX has seen some Kickstarter failures in the past during his time with the company. Even though they did not have a direct connection to these failures, it was still a learning process for the entire industry.
I had the chance to interview him on failures, and also get some insight on how people can avoid those mistakes with their campaigns. He also wrote down his company and what they provide for their clients.
What do you work on as senior marketing coordinator at InventureX?
I oversee marketing campaigns for our clients as they get ready to launch a crowdfunding campaign. In each industry, marketing needs to be tweaked a little so that the campaign has the maximum opportunity for success.
If everything is handled properly and set up the right way, the idea has a great chance of becoming a reality. It’s a process my team has been perfecting over the years.
While everyone likes to focus on the success stories, you find interest in failures. Why is that?
Identifying the reason for failure allows me to make adjustments to future campaigns. There are always new techniques being tried out in this industry, and some of them just don’t work. While I admire some of the risks that entrepreneurs and even our competition take, there is something to be said for using proven methods.
What are the three biggest Kickstarter failures you have seen, and what went wrong?
There are a few that stand out, and each one failed for slightly different reasons. The scarp laser razor was advertised as a great way to remove hair at home with lasers, but their working prototype never actually existed. They received millions of dollars in funding on Kickstarter, but they claim to still be working on issues.
The Tourquing Group used crowdfunding to raise money for a drone that had a ton of technological features, but delay after delay made many backers frustrated. It turned out that they simply couldn’t make the drone meet expectations. This was a classic case of overpromising and underperforming. After that, they filed for bankruptcy before they could have any type of success.
Finally, a lot of people remember all the hype that surrounded the world’s thinnest watch. It was called the CST-01, and it really just experienced a bunch of delays that lasted for years. It soon became more and more apparent that the millions of dollars they brought in was still not enough for them to reach expectations. The company eventually filed for bankruptcy, and many people lost money on that Kickstarter.
How do you avoid failures with InventureX?
We try to work with entrepreneurs who have a very solid idea in place from the beginning. They also usually have realistic expectations, or we work on the expectations before launching. Not only does a failed campaign look bad for us as a company, but it can ruin an entrepreneur. We try to make sure everything is set up for success.
How do you handle failure when raising money initially?
We do our best to pinpoint what possibly went wrong if a crowdfunding campaign does not reach its financial goals. In some cases, we can re-launch the campaign and see a lot of success with a few tweaks. Not all hope is lost if the first campaign comes up just short.