Why A Failed Kickstarter Might Be Your Key To Success

Zach Supalla learned it the hard way: sometimes it takes a failed Kickstarter campaign to find success the second time around.

When Zach Supalla's Kickstarter campaign launched last April, he played a drinking game with his team. Every time the campaign hit a new $1,000 mark, they drank a beer. "By the end of the night, we were at $15,000 and we were all under the table," says Supalla. They hit their goal within an hour and 15 minutes, raising $48,000 in the first day. By the end of the month, the campaign for Spark Core, a chip that attaches to products and appliances to make them Internet-connective, had raised nearly $568,000.

What made the success particularly sweet was that less than seven months earlier, Supalla had launched a failed Kickstarter campaign for a similar product, Spark Socket, that missed its funding goal by nearly $125,000.

Supalla admits that he is living proof that sometimes it takes a failed Kickstarter campaign to succeed the second time around. So what did he do differently? What lessons did he learn? Here are five key take-aways from his Kickstarter to yours:

1. Hurry up and get to market.

When Supalla came up with the idea for Spark Socket, an Internet-connective lighting system, it took him 11 months before he was ready to launch his Kickstarter. By the time the campaign went live, competition had entered the market. Just one month before launching, another Kickstarter campaign for a similar product called LIFX raised more than $1.3 million. The second time around, when Supalla and his team realized they wanted to create a Wi-Fi-connective chip that could be used with various appliances, they gave themselves only one month to launch their campaign.

The lesson: Don't take so long to get to market. If you've got an awesome idea, especially one that integrates existing technology, chances are it won't take long for someone else to get there first. Act fast.

2. Build it cheap.

Because he had little engineering and production experience when building the Spark Socket, Supalla had to make things up as he went along. Using plastic molding meant the Spark Socket's costs were very high, rounding out to $245,000. Even with 1,600 backers the first time around, the campaign made it only little more than halfway to its goal.

When developing Spark Core, Supalla and his team focused on lowering production costs as much as possible. The open circuit board design eliminated plastic molding, which not only got rid of a huge expense; it also allowed for more design flexibility—an important factor to consider when building a Kickstarter project. Lowering production costs meant the Spark Core's Kickstarter goal could be much lower. Rather than focusing on covering fixed costs, they could focus on how to refine and develop the technology.

3. Don't launch to an empty room.

Ten days before the Spark Socket campaign ended, Supalla knew it wasn't going to reach its goal. Rather than throwing in the towel, he built a separate website outside of Kickstarter that would allow him to stay in contact with backers should he want to reach out to them down the line. When the first day of the second campaign rolled around, they'd already started building buzz with existing fans. "That first day of a campaign is so important," says Supalla. "If you aren't 10% at your goal by the first day, people write you off."

Build your fan base before you launch your campaign or you might be hard-pressed for backers. Create a Twitter account and Facebook page for your product and go to conferences and Meetups to spread the word in advance. If your campaign isn't going as well as planned, find a way to hang onto your backers because they could help you the second time around.

4. Use backers for feedback, not just money.

Kickstarter isn't just a way to raise money, it's also an opportunity to get valuable feedback. "Find ways to engage your backers and open conversation with them," says Supalla. Spark Core did this by creating a community site that invited people to post questions and give feedback on the product. As a result, Spark was able to make more changes based on Kickstarter feedback alone. Making your campaign about more than just money is especially important if you don't reach your goal.

5. Don't lose your personality in the polish.

One of the advantages entrepreneurs have over large companies is their ability to let their personalities really come through. Supalla's first video had his personality in it, but it was a lot of up-close shots of him sitting in a chair talking. In contrast, the video for Spark Core was narrated by a handful of team members. It showed them working together on prototypes in their design studio, roaming the streets of Shenzhen, China, riding trains, ordering pizza. In less than three minutes, viewers got a sense of the entire team and how they worked together. "It's not just about being polished," says Supalla. "It's about being a real person."

6. Think beyond the Kickstarter.

When the first campaign flopped, Spark wasn't left dead in the water. A day before the campaign launched, Supalla had signed on with an accelerator called HAXLR8R in China. Just a few weeks after the campaign failed, he and his team members got on a plane to Shenzhen where they developed the Spark Core. Even if your campaign doesn't meet its goal, make sure you have a way forward regardless.

7. Set a realistic goal.

Setting the right goal the second time around was important for Spark, especially given how grossly they'd overshot what they were actually able to raise the first time. Thanks to reduced costs, the second goal could be much more conservative. Supalla knew the figure had to be high enough to merit crowdfunding, but low enough that it could definitely be met.

Don't be fooled—you don't need to set a huge goal to generate a lot of backer interest. "With Kickstarter, when people see something successful," says Supalla, "they pile on."

[Image: Flickr user Keenan Turner of MDK Media]

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