1. Crowdfunding
EntrepreneurialSpark
8th March 2012
@twintangibles
#crowdfundingES

2. Agenda
• What is Crowdfunding?
• How is it linked to social?
• Advantages, disadvantages & examples
• What is typical?
• How to be successful
• Kirsty Burnham - SoLoCo
• Q&A

3. What is Crowdfunding?

4. What is Crowdfunding?
“Crowdfunding is a method of raising
capital, or resources, by collecting
together lots of small amounts from a
large number of people generally using
the Internet and social media.”

5. Obama 2008 Campaign
$264.5M
Total
<$200
$122
$88.2m
$27.7m
Obama McCain
www.xplane.com/obama

6. Brewdog
1st round: 2nd round:
• 10% Firms • 8% Firms Equity
Equity • £95 per share
• £230 per • 5000 investors
share • 90% sold in 3 months
•First time any • 1300 • £1m investment in less
company in Europe had investors than 2 weeks.
attempted to raise • 20% off in • £95 to £12k individual
money via an online the shop! investments
share offering

7. All or Nothing
Reward Based
Take it All
Holding Model
Crowdfunding
Platform Models Equity Based
Club Model
Micro-lending
Micro-finance
P2P

8. Where is it Used?
Source http://www.core77.com/blog/kickstarter/crowdfunding_revolution_should_i_do_this_21697.asp

9. Crowdcube
Source: www.crowdcube.com

10. How is it linked to social?

11. Popularity
Value The Long Tail
Quantity
Products

12. Re-imagine Yourself
?
£

13. Viral Reach

14. Expectation of Return
• Non-traditional
• Brand loyalty
• Less aggressive?
• Longer term?
Coase’s Penguin – Yochai Benkler

15. Advantages, disadvantages and
examples

16. Advantages
• Market testing
• Distributed cognition
• Not just cash
• Small sums quickly available
• Brand advocates
• Increasingly a location for VCs
• Stable investment
• Expectation of return

17. Disadvantages
• It doesn’t always work
• Damaging?
• It’s not free
• It is not a panacea
• How will other investors view it
• Administration cost

18. Printrbot – 3D Printer
•$25,000 Goal
•Avg. donation $460
•17 Reward categories

19. The Bicycle Academy
•£40,000 Goal
•9 Reward categories
•Funded in 6 days
•Campaign Build-
up/Preparation time:
5+ months

20. What is typical?

21. So what is typical?
Successful
Pledged Projects Backers Avg # backers Avg Project Value Avg Pledge Value
Film & Video $32,473,790.40 3,284 308,541 94 $9,888.49 $105.25
Music $19,801,685.21 3,653 260,178 71 $5,420.66 $76.11
Design $9,180,637.55 319 99,923 313 $28,779.43 $91.88
Art $5,900,166.14 1,172 78,558 67 $5,034.27 $75.11
Publishing $5,134,388.55 774 74,280 96 $6,633.58 $69.12
Technology $4,673,470.41 125 39,341 315 $37,387.76 $118.79
Theatre $4,051,962.62 931 50,144 54 $4,352.27 $80.81
Games $3,616,530.88 253 45,622 180 $14,294.59 $79.27
Food $2,809,503.31 241 30,682 127 $11,657.69 $91.57
Photography $2,116,261.93 343 26,897 78 $6,169.86 $78.68
Comics $1,763,628.48 267 27,544 103 $6,605.35 $64.03
Fashion $1,351,659.85 182 16,793 92 $7,426.70 $80.49
Dance $1,054,763.95 292 14,377 49 $3,612.21 $73.36
Source: www.kickstarter.com

22. Source: www.crowdcube.com

23. How to be successful

24. Relative Success
Kickstarter fundit.ie
100
44% 75%
0

25. Keys to Success

26. Keys to Success

27. Keys to Success

28. Keys to Success
• Be Social Media ready
• Have a plan and prepare
• Don’t forget your offline community
• Select your project carefully
• Select your platform carefully
• Develop your rewards
• Create your pitch
• Select your channels
• Develop a publishing plan
• Define and allocate the resource and skills required
• Get advice
• Get legal advice

29. Tim Wright
tim@twintangibles.co.uk
@twintangibles
www.twintangibles.co.uk
twintangibles 2012

30. Kirsty Burnham