(Wendy Brandes and Kickstarter Stacy Lomman)
Are you blogging for love, or for money? I swing both ways. Yeah, bitches, I’m kinky like that. I started my Wendy Brandes Jewelry blog in 2007 to promote my fine jewelry line. But, before I was a jeweler, I spent 10 years as a journalist at the Wall Street Journal, CNN and People.com. I loved writing and editing. So, the jewelry business’s blog gave me a good excuse to do something I love, and I must love it a lot, because I easily spend 40 hours a week writing my blog and interacting with other bloggers.
I followed a number of fashion blogs before starting my own and I was sure my business angle meant I was going to outlast many bloggers who were in it for love. As all of you Independent Fashion Bloggers members already know or will soon learn, creating and maintaining a good blog is hard work. If blogging and/or fashion is just a hobby for you, I won’t be surprised if you abandon your blog when you graduate from school or start school; when you leave your job or get a job; when your classmates or colleagues or family members start reading your blog, or when they stop reading it; when you meet the love of your life, get married or break up; when you have a baby or when your teenagers enter those difficult years. I’ve observed that nearly any kind of major life change or fleeting bad mood can lead to this kind of announcement:
“Sometimes posting would seem more like a chore than an enjoyment, and it should not feel like that at all.”
That particular quote is from a blogger who announced her blog’s demise last month, but I’ve seen sentiments like it expressed in almost identical language scores of times over the past three years. I believe that the bloggers who eventually find a way to integrate their blogs with their professional lives are more likely to stick to their blogging than the ones who do it for fun. As I said, a blog is work, and work is, by definition, not always fun. That’s why it’s called “work” and not “rainbows and unicorns flying out of my ass.” Of course, not everyone who finds a career thanks to blogging starts with that intention, but blogging can generate opportunities worth seizing upon: 14-year-old Tavi of Style Rookie has collaborated with Rodarte; Rumi of Fashion Toast is modeling for H&M; and Jane from Sea of Shoes got a design contract with Urban Outfitters. But what if no big company reaches out to lend you a hand (one that’s wrapped around a wad of Benjamins) yet you have dreams of embarking on a business that’s more than selling bits and bobs on Etsy or eBay? You might want to use your social-media skills to get some crowdfunding.
Crowdfunding uses the Internet to reach your network and your network’s network to raise money to start a business or take an existing business to the next level. The concept has been around for years in various forms — people have gone online to solicit donations for charities (DonorsChoose, founded in 2000), new albums (Marillion’s Anoraknophobia came out in 2001), and even to erase credit card debt (Save Karyn, 2002). I think crowdfunding is gaining momentum now due to the increasing number of ways that we can connect online and beg for money via blogs, Twitter and Facebook. It was the backlash over Facebook’s privacy policies that drew my attention to the possibilities of crowdfunding for small entrepreneurs. In April, four programmers used crowdfunding site Kickstarter to request $10,000 for a privacy-conscious alternative to Facebook called Diaspora. Disgruntled Facebook users threw money at the project; Diaspora wound up with more than $200,000.
That’s the kind of number that I pay attention to, so when longtime clothing designer and newish fashion blogger Stacy Lomman of taffetadarlings told me she wanted to raise money to fund her first namesake collection, I screamed, “Kickstarter!” We checked it out and liked what we saw. Would-be entrepreneurs start a project for free, set a target financial goal and a target date for raising that sum, then solicit pledges that are processed via Amazon. The donors’ accounts aren’t charged unless the fundraiser meets his or her target investment by the target date. If the full amount isn’t raised, the fundraiser gets zilch. If the amount is raised (and, as you can see from the Diaspora story, it can be exceeded), the fundraiser gets the money minus a 5% fee charged by Kickstarter and credit card fees charged by Amazon. Stacy launched her project on Saturday, July 31, seeking $6,000, and was fully funded by Wednesday, August 4.
Here are my hot tips for making Kickstarter work for you:
- Make your online pitch sex-ay.
- Make your rewards sex-ay.
- Promote, promote, promote.
For the pitch, be clear about what you’re trying to accomplish, just like you would when pitching your idea face-to-face. Use photos and video to illustrate why your business concept will rock our world. Kickstarter’s blog has some tips about producing good video here.
Appealing rewards are key, because your donors aren’t going to get a share of your company in return for their investment. (In the U.S., that might run afoul of Securities and Exchange Commission regulations about equity offerings.) Their only motivation is a copy of your album, or a t-shirt, or a ticket to your film premiere. Stacy’s donation rewards range from a mention in her program for $20, to a dress that’s named for you and that you get to keep for $650. (Peeps in the know realize that you don’t get a handmade, couture-quality, U.S.-manufactured dress for anything less than $1,500, so that dress reward is very compelling.) She accepts donations as low as $5 but there are no rewards until $20.
Make sure you’re realistic about distributing the rewards. The founders of OpenIndie, a crowdsourcing site for independent filmmakers, raised funds for their site through Kickstarter. Their offer of hour-long consultations about how to build an audience for a film means that, “We’re still working our way through the 100 filmmakers. Scheduling so many consultations across so many time zones with filmmakers’ schedules being so full and Arin’s time being limited has been a challenge.” Spending 100 hours on other people’s projects when you’re trying to start your own isn’t a good idea.
Promotion is always a big part of business. A few lucky people have lucrative careers fall into their laps. The rest of us have to leave our caves, hunt down potential sources of business, beat them over the head with our clubs and drag them back to our lairs. It ain’t easy and you can’t be shy. Reach out to everyone you’ve ever met, keeping in mind that mass emails, Facebook invitations and tweets are just warm-ups for more personal pitches via phone calls and private emails. As I told Stacy, whenever I send out mass emails about sales, I follow up with as many individuals as I can. I holla at my best customers, as well as people who I remember have been eyeing a particular piece for a long time, and people who have never spent a red cent with me and are long overdue to do so. I point out particular necklaces or rings that might be of interest to them. That’s where I usually clinch the sale.
One caveat about promotion: People get a lot of solicitations for donations. It can be a turnoff to be asked for money every time you check your BlackBerry. Tell them that retweeting, blogging, posting on Facebook and emailing information to their network is greatly appreciated even if they can’t contribute financially.
One caveat about the above caveat: Your immediate family members must contribute financially. Even if it’s a dollar just to show support. I don’t care if they have to earn that dollar by making license plates in lockup for 35 cents an hour. If you don’t have the chutzpah to ask your relatives for a few bucks, you’re not going to succeed anyway, so don’t waste my time.
If you don’t think strategically about pitch, rewards and promotion, you’ll end up like a woman The New York Times wrote about last year. Fran Bittakis of Portland, Ore., wanted to raise $2,500 to start selling Thai food from a converted school bus but only managed $130 in her allotted time. Fran suggested that she would have done better if she’d created a blog and a video for her pitch. I agree that would have helped. But a closer look at her project page reveals other problems besides the pitch. Her top reward was $200 worth of screen printing at her screen-printing shop. Does the average person need much screen printing? As for promotion, her $130 figure is surprisingly low. Did she reach out to all her friends and family and get only that? Makes me wonder if they know something about her cooking that I don’t. Remember, the appearance of popularity increases popularity. People like blogs with lots of comments and nightclubs with lines outside the door. You don’t want to hear crickets chirping unless you’re camping.
In addition to the pitch, rewards and promotion issues, Fran had two other potentially off-putting details. First, to my amusement, the converted bus is described as a “short” bus. Second, the name of her screen-printing business is Seizure Palace. Her food business was to be called Tiger Style, but the name Seizure Palace appears four times in URLs, beating out Tiger Style’s three mentions. I wondered if Seizure Palace was a play on “Caesars Palace” or an indication that Fran was an out-and-proud epileptic, but her website didn’t tell me. (I did applaud the site for describing Fran’s role at the company as “makes sure shit happens” and her husband’s as “makes shit happen.”) I emailed Fran for more information. She replied, “Seizure Palace was the name of our house when we still lived in Florida. We had a hard time coming up with a name for our screen printing shop so we thought we would use Seizure Palace. It definitely gets people’s attention, but sucks when you have to spell it every time I’m on the phone with a purveyor!” Hmmm. I know that Shakespeare wrote, “What’s in a name? That which we call a rose by any other name would smell as sweet.” But I bet even old Shakespeare would think twice about ordering food from the Seizure Palace short bus.
Failing to get your project funded isn’t the only thing that can go awry for businesses using crowdfunding. If you asked me what my five-year plan was in 2005, when I left my corporate job to work on the jewelry business full-time, I can assure you it would not have included my business partner’s death, the collapse of the global economy and the doubling of gold prices. What if you have a band? You could have a successful fundraising effort and go into the studio to record your new album, only to break up. That happened to Hope for Agoldensummer (again with the hard-to-market name?), who lost a year’s worth of work, went into debt, and aggravated their fans. Caveat donor! Treat Kickstarter participation like any other investment. Only put in what you can afford to lose. You’re dealing with a start-up and sometimes things go wrong even when honest, hard-working people have the best plans and intentions. Also, keep in mind that with Kickstarter, you’re not entitled to any updates about how the money is being used. You’re not investing in a publicly traded company that’s going to publish detailed quarterly reports on the state of its business, nor are you having lawyers draw up elaborate contracts. You’re just placing a bet on a person and his or her idea and hoping for the best.
Everyone — those who give and those who receive — needs to read the fine print in a crowdfunding site’s FAQ. Be clear about any fees. While Kickstarter takes 5% of the money raised, the now-defunct Fundable, which had the same all-or-nothing model as Kickstarter, charged 10%. Don’t forget to search teh Interwebs for complaints about the company while you’re at it. There are plenty of negatives about Fundable that are still findable. One unhappy user successfully raised her funds but couldn’t get them transferred into her account. With Kickstarter, Stacy was clear about the fees but said, “The one thing that worried me is that after I signed up, filled everything out, linked my bank account, etc., they had a message saying that the funds may not be available until 14 days after! I wasn’t clear if it meant after the goal is met or after the end-date of the project, which is September 8 and it that case, I would be sca-rewwwwed!” See, Stacy gave herself plenty of time to raise her money … almost right up to the date of her presentation on September 13. Sure enough, according to the FAQ, “Amazon will hold funds for 14 days after payments are collected. Once this hold is released, project creators can transfer funds to their bank account (which can take 5-7 days).” Payments aren’t collected until the project’s end date. With her money tied up until AFTER her event, Stacy is going to have to briefly borrow from a relative, who she’ll pay back before the end of September. She’s not totally sca-rewwwwed, but it’s not the ideal outcome either.
Not every crowdfunding site will suit your needs, so look around. For instance, Kickstarter can only be used in the U.S. right now. Here are some other options. I have no experience with any of these, so do your research before signing up and don’t come crying to me if it doesn’t work out for you.
- Go Big Network. Seems to be a way to connect with more traditional investors.
- Kiva. Microfinancing loans intended to alleviate poverty around the world.
- Catwalk Genius. Fashion-oriented. U.K. and Ireland investors can buy shares in a designer’s collection with the goal of earning profits from future sales.
- Cameesa. Crowdfunding for t-shirts.
- Sellaband. Music.
- ArtistShare: Music.
- Feed the Muse: For music, art, film and more.
- OpenIndie. Film.
- Biracy . Film. Here’s an interesting blog post about it.
- Grow Venture Community. Note: charges monthly fees.
- MyBandStock. Music.
- Ulule. Available worldwide but you have to be 18 to join. Sorry, Tavi!
- IndieGoGo. The OpenIndie founders seem enthused about this one, which is international. They note that “IndieGoGo takes 9% of the final money raised as a fee for using the service but also offers a 5% cash reward for anyone who hits their goal, which is nice and effectively means your fee is only 4%.”
- FirstGiving. Charity fundraising.
- ChipIn. Charity fundraising.
- The Ministry of the Impossible. I found this while searching for crowdfunding. The site says: “The Ministry brings together artists, scholars, entrepreneurs, comics, activists, architects, musicians, writers, public officials, and active citizens of all kinds through nominated membership in the Ministry. Together we support each other in boldly re-imagining and transforming society, politics, and culture. Ministers experiment with new ideas, expand consciousness through imagination and discovery, and raise the level of discourse about the problems we face in a new century. And sometimes fail, and sometimes succeed.” Okaaaaay. I’ll pass on this one, but if the Ministry of Silly Walks starts accepting applicants, let me know.
If any of you try or have already tried Kickstarter or any of its alternatives, report back here. I’ll be interested to know how it turns out for you. To help Stacy fund her show — there are still dresses to be sponsored — visit her on Kickstarter. If you’re going to be in New York for fashion week and want to attend Stacy’s show, get in touch with her. While you do that, I’m going to email Fran and offer her free feedback on the name of her next business venture. I want to help her make shit happen.