Gap->GaS #9: Crowdfunding Special: Owed to a Grecian Earn?

Here at HHH we often find our events attended by some of the most ambitious, forward-thinking and disruptive startup characters not just in London, but from all over the world (we’re a truly international gang, that’s why you’ll find us skiing in the Alps, and incubating/accelerating in the Carribean). But even we felt privileged to welcome the man behind the most ambitious Crowdfunding campaign of all time to our latest #GaPGaS event last night, with a funding target of…wait for it…£1.6 billion!
Does that figure sound familiar? It should do, because it represents the exact size of the bailout required to keep Greece within the EU, which is precisely what out special guest, Thom Feeney, tried to do…on Indiegogo!

When Thom, a shoe shop worker who, thanks to his unique brand of international diplomacy has now been appointed community manager at WeWork, (the global co-working cooperative recently valued at $5bn, and one of our fantastic new sponsors), realised that all that was needed to “save” Greece was a donation of just €3.19 per British citizen, he quickly knocked up a rewards based campaign on Indiegogo, outlined his goals (stimulate trade, save the international community…the usual), offered some tasteful rewards; a bottle of ouzo, a postcard from the President of Greece, tweeted some journalists, and went to bed. Not bad for an hour’s work; when he woke up the following morning he realised that he had broken the Internet. 108 thousand contributions, €1.93m raised, 8 contributions of more than 5k; front page coverage from the Huffington Post & Mashable, friend requests (mostly from Greeks) jamming his Facebook, and his own personal Indiegogo engineer! The definition, in other words, of a social media phenomenon. Thom even had to appoint his girlfriend as his temporary PA!
His one regret? Thom’s campaign was a fixed funding model, meaning, since he “only” raised 0.12% of his target, he had to return all the donations in full. Not to worry, Thom has since launched a second campaign, in association with a Greek charity, raising funds to help introduce training programmes for unemployed young Greeks, raising €290k to date. Kudos to you, Thom!

In all seriousness what Thom achieved in such a short space of time (did I mention the interviews with Fox, the BBC and Al Jazeera?) by feeling the national pulse and tapping into their desire to help their fellow man, is what Crowdfunding is all about. Last night more than 150 HHH’ers, who know all about crowd sourcing answers to tough start-up problems thanks to #GaPGaS (Got a Problem?->Get a Solution!…as if you didn’t know!) gathered to offer the usual inspirational, controversial and occasionally just plain crazy advice to some of our struggling founders.

Crowdfunding

But before I summarise a memorable nights contributions, let me ask you one quick question; what do all these ground breaking startups all have in common? Viber, WeWork, Moo, Event Ninja, SnapZap and Glisser?? That’s right, they are all recent partners of the Hipsters, Hackers & Hustlers project! Together we are stronger, growing in influence  and making London’s, nay the world’s, tech scene a better, more challenging place to be and space to operate in. So join us! Insert backslap / group hug / high five / hockey stick projection here!

So, onto those Crowdfunding pain points: as always I’ll have to be all too brief; read on if you please but remember there is no substitute for coming along and sampling the atmosphere yourself. Plus you never know who you might meet ; – ) here goes:

Problem: TJ is launching an Instagram / Pinterest / Clueless closet organiser(remember that!) style app and the Crowdfunding campaign is going live in just a few weeks. TJ decided to go with a rewards based campaign rather than giving away equity in his business in exchange for funds. So what kind of rewards will attract the most generous donations?
Solutions: it’s tricky; regular vocal contributor Andrew suggested stylists, clothing, samples, anything that reflects the market you are in and where you want to go within that market. And, typical Andrew this, “however hard you’re blagging, blag harder!” Guy, a stylist, recommended vouchers; the donater receives a more versatile reward that way; a third suggestion, a little off the radar this one, was to check out the new Mayor of  London fund for start-ups which is apparently worth £5m. So, don’t bother Crowdfunding at all? Hmm, well everyone gets a say, that’s democracy after all…another thing we have to thank the Greeks for 😉

Problem: Tom runs an advertising platform, Beneficent that allows you to watch selected brands’ YouTube advertisements. Every time you watch one, Beneficent make a donation to charity. Very cool. Crowdfunding tips?
Solutions: Branded T-shirts! Sounds simple but no self respecting startup should be without them. Another; let the donater nominate the charity you make the donation to. Brilliant! And how about this; offer the chance for somebody to come on board and help the team as a work experience intern in exchange for donations. I told you HHH’ers were brilliant, original thinkers!

Problem: Guy the stylist was struggling to market his free app, finding support for a Crowdfunding campaign hard to come by; he was considering going down the business angel route instead.
Solutions: Mike at Glisser backed him up; “meet as many angels as you can, and be persistent!”
Andrew had this to say: bear in mind how much competition there is around Angels; first of all, show your team are not a bunch of idiots (problem: if you really are a “bunch of idiots”, chances are you won’t know you are!) second, show exactly how you plan to grow and dominate your market sector, and finally, get some traction! Letters of intent are worth so much more than business plans; what you have already achieved versus what you hope to achieve? Only one winner! Get it right and Angels will be “ripping you arm off”. You heard it here first.

Problem: Back to Crowdfunding; Mario at Photospotland only wanted British pledgers, not Italian ones (he’s Italian). Bizarre, but there are sound business reasons apparently. Additionally, Mario wanted to know when someone will make it possible to receive donations from UK and U.S. Investors on the same campaign. At the moment, believe it or not, thanks to different regulatory environments, it’s not possible. A huge opportunity for somebody, surely?
Solutions: Another recommendation from our audience (we were bombarded with online suggestions too, thanks to Glisser and their faultless technology, which we projected on to the stage, thanks Mike!) was To try H-Farm Ventures, an Italian accelerator helping young start-ups launch Crowdfunding campaigns.

Problem: Simone, manufacturing resistant materials such as bullet proof vests, body armour and blast proof materials; what rewards should she offer?
Solutions: How about a bullet proof vest?! Or how about nominating the recipients of a bullet proof vest; an honours board for donators, perhaps, or how about issuing some debt or some bonds?

Strangely, one of the themes of the evening was founders resistance to parting with equity. And I thought Crowdcube was shaking up the Crowdfunding industry. Hmm, seems rewards based funding is still the way the entrepreneurs want to go.

And finally, my advice? Well, I always like to add my 2 cents worth, as you know; in this case it would be not to start your campaign with a total raised figure at a big, fat zero. Always make sure someone has pledged something, however small; friends, family, team members, whoever, just make sure somebody has got the ball rolling, because the stats show a campaign is far more likely to take off if at least part funded. It’s the old “who is going to take the plunge” problem. How some initiative by kicking things off; after all, if you don’t show faith in your company, why should anybody else.

That’s all for this week folks, join us at out next speed pitching and GaPGaS events, and come and see us attempt a “p*ss up in a brewery” when we run our most hotly anticipated event yet, TECHtoberfest, at London Fields brewery

Keep on hustlin’ ; – )

%d bloggers like this: