Product Startup Podcast Episode 033: Top Crowdfunding Mistakes and How to Recover

00:00:00 Filip Valica: Hey, everyone. Welcome to the Product Startup Podcast, a podcast that helps bring your product idea to life by chatting with successful inventors, product designers, and other industry professionals. This podcast is run by Mako

00:00:11 Filip Valica: Design + Invent, and hosted by Filip Valica. Our goal here is to get to the bottom of what makes a product successful, from initial idea to putting your product on the shelf. We're taking you step by step to build a functional product and scale your product business. Now onto the show.

00:00:26 Filip Valica: The Product Startup, Episode 33. Khierstyn Ross helped creators raise over one point. $1 million through Indiegogo and Kickstarter, and she's also the host of crowdfunding uncut, a podcast that deconstructs the successes that go into funding campaigns.

00:00:43 Filip Valica: Welcome to the Product Startup Podcast, where we talk about turning ideas into successful products step by step. I'm Filip Valica, and thanks for listening today. In the last episode, we talked with Jill Bong.

00:00:56 Filip Valica: She's an entrepreneur, homesteader, and inventor of chicken armor, a different chicken saddle. Make sure to check out episode 32 if you want to hear more about how she and her husband successfully launched a product and make income in a tiny niche.

00:01:08 Filip Valica: Before we get started, I wanted to read an anonymous listener's question. He says, I read your site, great info on there. I currently have a company that sells a few different types of products. Business is going well and I'm trying to create a prototype.

00:01:22 Filip Valica: However, I'm running into the challenge of very high development costs. I would really appreciate some feedback and advice.

00:01:29 Filip Valica: so using outside development companies will set you back a good deal of money they usually assign engineers and designers at shop rates to work on the design and they may even develop their

00:01:40 Filip Valica: prototype for you at additional cost so keep in mind in the u.s the costs are usually between 80 and 120 an hour depending on the level of experience of the team that's

00:01:51 Filip Valica: assigned to you and that's per person so naturally if you've got a few people that are assigned to the project development companies may easily charge 10, 15,000 depending on the complexity of the design on up to something that's a very complicated

00:02:04 Filip Valica: project costing $50, $75,000 to complete. So this is usually the fastest and smoothest way of getting to that next step. If you want, you can also look at managing this scope yourself and considering some other routes.

00:02:17 Filip Valica: For example, look into using off-the-shelf components to put together most of the prototype and only customize the one or two pieces that are new for your product.

00:02:26 Filip Valica: Perhaps modifying something else yourself, even a competitor's product, can get you close enough to where you have something functional and get some feedback. Depending on how hands-on you are, this is usually the cheapest route.

00:02:39 Filip Valica: A second way of approaching this is going to a local college that has an engineering or industrial design department and offer to sponsor a senior design project.

00:02:49 Filip Valica: Final year students typically complete a cradle-to-grave type engineering project over the course of a semester. This usually will get you a dedicated resource or small team for, let's say, a few thousand dollar donation.

00:03:03 Filip Valica: Now, they may not be able to build you the prototype. It really depends on the facilities at the college and the skill set of the students that you get, but they will definitely be able to solve some of your more difficult challenges.

00:03:14 Filip Valica: The last place to look would be using a freelance service and finding a freelance industrial designer or engineer. You can find them online through places like Odesk or Freelancer.com or even on Craigslist if you want someone local.

00:03:29 Filip Valica: Their bid should be much more competitive than using a outside development company. But of course, you usually only get one person helping you with a design and you're trusting that they have the expertise to complete it for you.

00:03:41 Filip Valica: You can then take the design that they've built and solicit fabrication costs at local fab shops in your area or going to a place like mfg.com and submitting.

00:03:51 Filip Valica: your quote using either drawings or a 3D model that was created by your freelancer. So I hope that helps you guys. Feel free to send me email at philip at the product startup.com and let me know

00:04:02 Filip Valica: what kind of questions you'd like for me to answer on the show. So let's get started with today's interview. Hi, Kirsten. Thanks for coming on the show today. Yeah, thanks for having me. So I'm really excited to have you on just because a lot of the guests that we've had on the show have done their own

00:04:15 Filip Valica: crowdfunding campaigns. Can you talk a little bit about how a Kickstarter can help get revenue at any stage of your product lifecycle, whether you know, you've got an idea that

00:04:27 Khierstyn Ross: you've tested all the way to where you're already a company and you're creating revenue, but you're trying to generate some additional buzz or maybe test if a product is working.

00:04:35 Filip Valica: Your question is, how can we make sure that a product makes the founder money? Well, how can we use crowdfunding to either generate additional buzz for the business

00:04:45 Khierstyn Ross: or generate additional income for projects that you may not feel 100% confident about or you might not have the funding for. So I've had the luxury of working on two kinds of projects. One is where you're starting from nothing.

00:04:58 Khierstyn Ross: And then one where you're coming in to an established company that has a bit of startup capital, but is like launching product 2.0. And it's a way to create awareness around that product and then use that once they finish

00:05:12 Khierstyn Ross: their Kickstarter or Indiegogo campaign, they can then continue and in demand right through until they launch that product on Amazon. So you're pretty much making money on that product as soon as the campaign is over right up until you're actually delivering that, which is cool. It really depends.

00:05:27 Khierstyn Ross: Like your ability to make money with certain products depends on how far into the lifecycle you want to launch on Kickstarter or Indiegogo.

00:05:35 Khierstyn Ross: You can either launch to raise money to develop a prototype or you can launch when you have the prototype. And then your campaign is more around raising funds for that initial manufacturing run.

00:05:48 Khierstyn Ross: I think you're in a much safer place to launch when you have the working prototype already done, and it's just a matter of bringing that to market because there's a lot less room

00:05:58 Khierstyn Ross: for error with underestimating costs or running into problems when you're actually designing the thing to realize that, you know, the 500K you've raised isn't enough to bring this thing

00:06:09 Khierstyn Ross: to market. I've had the pleasure of working on campaigns where they're products that were validated because I tend to not take on campaigns where it's not something I think. think we'll sell because as an advisor, I don't make money if the creator doesn't have a successful

00:06:24 Khierstyn Ross: campaign, right? So there's that part of it. But part of having a early stage product is you have to figure out the positioning. I work out of an office here in Toronto and I had a guy approached me yesterday with this really cool prototype.

00:06:37 Khierstyn Ross: And luckily, they've had like Twitter approach them and Shopify approach them. So the idea is kind of validated. But in order to figure out how to position that properly for the consumer. As a founder, they didn't really understand how their

00:06:49 Khierstyn Ross: customer would use it as more of a gimmick. So early stage, I think your ability to bring a great product is how you choose to position that so you can relate it to the consumer when you

00:07:01 Khierstyn Ross: launch it on Kickstarter or Indiegogo. This happened with thin ice. My very first project where we failed, we only raised about a third of what we needed to, and we got the positioning completely wrong.

00:07:12 Khierstyn Ross: the product was great, but we ended up not speaking to a single customer before we launched. We just wrote some copy and positioned the video where we thought people would connect with it, but it ended up flopping.

00:07:27 Khierstyn Ross: And what we did the second time around was we ended up speaking to audience and see, okay, where's the disconnect, what is it about a crowdfunding page or a video that you're not connecting with and why aren't you buying? And it turned out that the product was great.

00:07:41 Khierstyn Ross: positioning was all wrong. That was just one of the few problems we had with the campaign, but we ended up going from failure to $600,000 launch. So I think you do have to validate the product, but it's one

00:07:54 Filip Valica: thing to have a great product and not understand how to sell it. It's another thing to have a crappy product that no one wants. So I think your question is kind of a two-pronged approach, if that makes sense. I really appreciate you sharing how the other campaigns that you worked on

00:08:07 Filip Valica: didn't really work out. I'd speak to people that say, hey, I think crowdfunding is going to solve all my problems. I have this great idea. Now I'm going to launch a Kickstarter or Indiegogo

00:08:16 Khierstyn Ross: campaign and people will flock to me and buy my product. How have you been able to make sure that you're speaking the language that resonates with your market? I think it comes down to like every

00:08:28 Khierstyn Ross: guru online now says that you need to build an audience before you launch. That's super important because if you launch to nobody, you're not going to make money. End a story. But it's what you do with the audience you have when you're building it to figure out positioning.

00:08:42 Khierstyn Ross: Like, I've done with TapLock, what we did was, so this is about like four months away from launch at this point. We had to make some assumptions of who we thought our customer was. And I hate saying make assumptions, but you've got to start somewhere.

00:08:54 Khierstyn Ross: And so we knew that, so TapLock is a padlock that opens with your unique fingerprint instead of needing a combination or keys. So it's really, really cool. But we thought, okay, who would be the best buyer for something like this?

00:09:07 Khierstyn Ross: And then we took it down to, okay, gym users would definitely use this and people with a bit of disposable income. So like 25 to 30 and we think it's probably going to be like a 60, 40 split male to female. So we had to make some assumptions.

00:09:20 Khierstyn Ross: And then we then use that information to start talking to people online, but also the founding team went and sat outside of gyms and surveyed people in an attempt to, A, grab their email address, but B, understand how they perceive the product.

00:09:33 Khierstyn Ross: And so we didn't just like throw up a landing page with Facebook. ads and say, join our list. It was more like having that customer interaction when we first started because we really had to understand what the consumer was going to perceive about our product,

00:09:48 Khierstyn Ross: why they would love it, why they wouldn't buy it, what their concerns would be, and what price point they would pay for it. So instead of guessing all these factors, which when you look at how you structure your campaign, like, how do you know how to talk to your customer, how do you

00:10:01 Khierstyn Ross: know what their biggest concern with your product is, or be able to answer their questions if you've never spoken to a single customer. So we have those customer interactions early on. And then we'll

00:10:12 Filip Valica: even take that so far as like when we're doing a Facebook ads campaign to build audience pre-launch. We have to test different demographics and different offers to see who's going to latch on to that before we like go full scale with these assumptions. Right. Really happy to hear you say that

00:10:26 Filip Valica: because that's one of the early steps that we use whenever we're creating new products and design is you have to speak to the target market because otherwise you end up spending all this time and money creating something that nobody wants exactly so having those conversations and like you said

00:10:39 Filip Valica: conversations with people not just a landing page and i think there is a slight misconception with that because like you said that you can read some books you know four hour work week i love tim ferris and a lot of the stuff that he puts out but there's that misconception and four hour work week that

00:10:54 Filip Valica: all you have to do is throw up a landing page and drive traffic to it and it's worse thing you can do like right and and i've actually done that just because i wanted to challenge my preconception that

00:11:04 Khierstyn Ross: hey, you know, maybe when I learned working in my jobs, maybe that wasn't the right way to go, especially as an engineer. I might be too stubborn and following this rigid mentality. Maybe there's this better way. And so I tested it myself and it didn't really have good success for me.

00:11:18 Khierstyn Ross: I think what landing pages allow you to do is get data for everything. And I've become kind of a conversion freak where, like, we'll have a couple different variants of a landing page to say, oh, man, this isn't really converting. Why isn't it converting?

00:11:30 Khierstyn Ross: or what we're doing with the project I'm currently on, I think we're launching in probably around the time this podcast goes live, but we are doing a content strategy. So we're releasing videos, like teaser videos on Facebook and YouTube.

00:11:45 Khierstyn Ross: And what we're seeing is with video analytics where people are dropping off. And like we discovered when we put the one minute video on our Facebook page, very few people are converting to email list. And sorry, the dryer.

00:12:00 Khierstyn Ross: just one. Nice.

00:12:02 Khierstyn Ross: I think I'm going to keep this soon.

00:12:04 Khierstyn Ross: Please do. I love these like bloopers. Okay. So what I was saying was like we discovered through content that people were dropping off. And if we had a call to action like at

00:12:14 Khierstyn Ross: the very end of this one minute thing, people were dropping off before maybe at 30 seconds and not seeing that. So we're wasting all this money on Facebook ads to not convert. So

00:12:23 Filip Valica: if we see that people are dropping off at 30 seconds, we can then edit the video to be more to the point or have a call to action. 30 seconds so it helps increase our conversions and it's just really cool to see like where people are

00:12:35 Filip Valica: interacting with your content and your landing page but it's so much more powerful to have that conversation with them i'm a data freak as well and so i agree getting data and testing it and tweaking things is huge in terms of being able to kind of narrow down your message and and focus

00:12:49 Filip Valica: and fine-tune some things around your site you mentioned that it's really key to have an audience

00:12:54 Khierstyn Ross: to launch too so if you don't have an audience but you have a product and a prototype Would you say the next step is to find an audience and grow that before you even think about a crowdfunding campaign?

00:13:08 Khierstyn Ross: 100%. So do you mind if I rant for a bit? Okay. Cool. Because I posted this rant on Facebook a couple days ago after I got off the phone with someone and it was very well received.

00:13:20 Khierstyn Ross: So I had this lovely guy local who emailed me late one night and he had launched his Kickstarter about four days before this. So like last Thursday.

00:13:30 Khierstyn Ross: And he's like, hey, I would like to hire your firm to advise and market my campaign because it's not converting very well. So I took one look at the page, saw he had a goal of $100,000 and four days in was only 4% funded.

00:13:44 Khierstyn Ross: And I was like, okay, what's your budget? When did you launch? What's your goal? And then he came back with his budget of 5K that he wanted to spend on marketing after his campaign was not doing well. And the first thing I said to him was like, do not spend a dollar on marketing until we speak tomorrow.

00:13:57 Khierstyn Ross: And I got on the phone with him and I like asked him a few questions about. how flexible his goal was. And I basically told him that he had two choices to pull the campaign down or if you can't do that, just give up on it and don't spend the money. Or number two, spend 30 days

00:14:11 Khierstyn Ross: hustling and going to angel investment and trying to get bigger wholesale deals to raise as much money as possible. And he's like, okay, but why am I just going to give up on this thing? Like I've

00:14:22 Khierstyn Ross: built a bit of an audience. I'm like, okay, well, the way that Kickstarter works is they have a popularity algorithm where Kickstarter and Indiegogo make a 5% cut off of every dollar they raise

00:14:34 Khierstyn Ross: on site. And so that means from a business perspective, they're going to help out the projects that are making them money. And they do that by boosting your rankings on site.

00:14:44 Khierstyn Ross: And so what you see in the Discover section or the trending section or front page or anything like that are projects that are really popular and moving really quickly. But in order for you to hit that, you need to have a

00:14:57 Khierstyn Ross: ton of momentum in the first two to three days after you launch. You need to have a certain amount of backers. You need to raise a huge chunk of your funding goal. I think the number is like 30 to 40% that you should raise in those first couple of days in order for you to get successfully funded.

00:15:12 Khierstyn Ross: And I don't mean the million dollar campaigns. I mean, if you have a goal of 40,000 and you legitimately want to raise 40K, you're looking at getting about 15,000 or 20,000 raised in that

00:15:23 Khierstyn Ross: first 72 hours or else your project is just going to be dead, most likely. And, So when I look at a project that's 4%, and I look at someone who wants to spend money on advertising, all I'm thinking is, okay, you spend money on Facebook ads, people are going to come to your page

00:15:37 Khierstyn Ross: and they're going to see, okay, even if they understand how crowdfunding works, they're going to see 4%. They're going to see this project is not popular, probably not going to get funded, probably going to fail. I don't want to be a part of this.

00:15:49 Khierstyn Ross: So that's part of perception is like you need that audience because you are never going to take advantage of the crowdfunding community unless if you are that unicorn that can launch with zero audience with this amazing project.

00:16:03 Khierstyn Ross: But you need that initial audience for you to get those initial backers, which are your friends and family and that list that you've built up before. Because when you open the floodgates

00:16:15 Filip Valica: and you stack it properly with getting people into back you early on, then that's going to raise your popularity on site to then get more traffic as that comes in through Kickstarter and

00:16:27 Filip Valica: Indiegogo. And then that's how you like catapult with it. But you can never get that initial

00:16:31 Khierstyn Ross: momentum if you don't have an audience to start with. So what I'm taking away from this is then having a crowdfunding campaign is really more of a boost to amplify the investment that you're

00:16:42 Khierstyn Ross: already should be getting from the audience that you should be talking to. It's not a way to go from zero to the next step. No, like you go from zero to the next step, not by, it's not like when you're building your list, you're collecting payments from customers, even though that would be

00:16:56 Khierstyn Ross: awesome, but you're not. You're keeping them excited and ready for a launch. And then what you do

00:17:02 Filip Valica: with that launch when you first go live is like people are interested because they want this, but they also want the product cheap. And you create like a Black Friday event with your first day on crowdfunding where it's like, if you are one of our first hundred backers, you get our product at 50%

00:17:17 Filip Valica: off and you create that herd mentality. So it's like you line up the people for the big sale when you open it. Yeah, that makes sense. And early on in the product development process, I always tell

00:17:27 Khierstyn Ross: people that they should go. And when they're having these conversations with people, if they're responding favorably to ask for that order, to get that pre-order. And so this kind of dovetails nicely because you can kind of hold off that exchange of money, even though it's really hard for people

00:17:41 Filip Valica: to pull out their wallet. You can at least say, hey, let me get your email. So when we do launch our crowdfunding campaign. You can buy into it at a discount. Exactly. But to make sure that they actually put their money where their mouth is, you incentivize it with Early Bird rewards so

00:17:55 Filip Valica: that you limit it to the first hundred people get this insane deal that nobody else will get

00:18:00 Khierstyn Ross: or something. If you're forming your audience before you're launching your campaign, because it could take you months to create your audience, how are you keeping them engaged? I guess you're just sending out updates in terms of this is what we've done recently with development and this is

00:18:13 Khierstyn Ross: where the status of the product is and here's a sneak peek or here's a photo or here's just something that to kind of keep you engaged. Yeah. Okay, this is internet marketing 101. If you are

00:18:24 Khierstyn Ross: interested in it, I do highly recommend you pick up Russell Brunson's book. It's called dot com secrets.

00:18:31 Khierstyn Ross: It's a lead-in to his email list, but for $10 in shipping, it's going to be the best investment you make. He walks you through how to create a full sales funnel, which is what I would suggest. So when

00:18:43 Khierstyn Ross: someone opts into your email list, you want to give them two kinds of emails. Over the months prior to your event, you want to be doing broadcasts. So it's like every two, three weeks,

00:18:54 Khierstyn Ross: it's like, hey, we're getting ready to shoot the video, or we just got final renderings of our prototype, or here's a survey, what's most important for you for this? Or here's an interview I did, or here's some content. So it's like you, every two to three weeks, just remind people that you're

00:19:08 Khierstyn Ross: around. But the first kind of is that the automated sequence you want to give them. when they opt into your list, which is the welcome sequence. It's something that you, A, thank them for being on the list.

00:19:20 Filip Valica: But then over the next couple of days, you want to give them a bit more background into who you are as a founder, why you're qualified to do this project. And how did this idea come about? And then, like, the next email after that is getting more into what the product is.

00:19:34 Filip Valica: So it's more of an educational sequence. So people get it. And you do this with that automation because you're using your email list to build a

00:19:42 Khierstyn Ross: relationship. And you're trying to sell the benefits of your product through email, I guess as clearly as possible. Have you found anything in particular that works better than something else? For

00:19:54 Khierstyn Ross: example, maybe linking to videos in your emails that show the prototype in use versus maybe an infographic versus just a plain text email that sounds more personal? Internet marketers will

00:20:06 Khierstyn Ross: say that you should just keep the email as short as possible and link to content on your site, as opposed to keeping everything in her inbox. I haven't seen anything work better than others, but what I would recommend is that you test different things

00:20:20 Khierstyn Ross: and see what your audience is more receptive to. But I think at the end of the day, when you're first getting started, you don't have that big of a list. And so what I would just encourage you to do is ask your audience to engage with you

00:20:33 Filip Valica: and just ask some questions. Like, why are you interested in this product? Or what is your number one frustration with playing electric guitar or whatever problem that your product is going to solve. At the end of the day, I think content is great, but you need to be engaging with people

00:20:47 Filip Valica: because if you can form those relationships with people who connect with your product, you can get them on the phone and do customer interviews, and it could just go so much further. No, I agree. Having that one 15-minute conversation is worth so much more than some random poll

00:21:00 Filip Valica: that may not get you, that granularity that you're looking for in the response back. Exactly. Let's pretend the campaign is launched now. You've got your audience.

00:21:09 Khierstyn Ross: What do you see are some of the typical stumbling blocks that people run into that maybe they don't execute well? You know, I've personally seen some pages on Kickstarter that don't look very professional, that don't instill confidence in the team.

00:21:22 Filip Valica: What's maybe the next step after that? If you've looked at some of the successful kickstarters and you've kind of tried to make sure that you're including the same type of information, what is one pitfall to look out for?

00:21:32 Filip Valica: I'd be really curious if you can tell me actually, sorry, podcaster here, but if you can actually tell me, like what is it about a page that you've been to that doesn't instill confidence okay as a designer i see

00:21:45 Khierstyn Ross: some basic things i see obvious flaws with the product that maybe they haven't thought of or maybe questions that i have that they haven't addressed some things made out of plastic and and secures with a

00:21:55 Khierstyn Ross: suction cup have they done the testing on that and at least have that FAQ at the bottom that says hey we hear your concern and we've answered it this way right yeah here's a link to this test or here's whatever yeah perfect so it's like okay i think we can make

00:22:09 Khierstyn Ross: an amazing long list of stuff. But it's like, what doesn't instill confidence? And it depends what lens you're looking through it. Like you're looking through it from a designer standpoint. We've had people pick apart our projects from an engineering standpoint. Or maybe they're a backer that's been

00:22:24 Khierstyn Ross: screwed before. And they're looking at your financial projections and thinking this isn't accurate. So a few things that could be red flags. It's one thing to get an audience, but then you still have 30 days for your campaign to do. So you want to make sure it's converting to the masses. So a few things,

00:22:38 Khierstyn Ross: FAQs be as in-depth as possible and answer questions like be as transparent as possible. We didn't know at the time if we would have a Windows app. So we completely disclose that and said, you know, based on popular demand, if that's something

00:22:52 Khierstyn Ross: we choose to do, then we're going to develop that or battery life is this or here the components we're doing. So FAQ, testimonials of people either using your product or engaging with it would be great. Having a forecasted breakdown of your budget.

00:23:07 Khierstyn Ross: So, like, why do you need to raise $50,000? Where is that money being allocated, specifically?

00:23:13 Filip Valica: Are you in partnership with anyone? Like, have you figured out the manufacturing side or the fulfillment side, or is that something you're working on? Just being as upfront as possible will really help.

00:23:22 Khierstyn Ross: And I think red flags are when you say we need to raise $40,000, but you don't give a breakdown. Your FAQs are very high level. You're not answering customer comments quickly.

00:23:32 Filip Valica: You're very evasive with things. I think that's when red flags come in.

00:23:37 Khierstyn Ross: Basically, being approachable, transparent as you can be, and instilling that confidence and trust as quickly as possible, because you really only have 30 days to convey all that. Exactly. And you only have your campaign page to do that. Right.

00:23:50 Khierstyn Ross: It'd be really cool, too, to put, like, a support email address below to say, if you have any questions or if things are not clear, please send our team an email. Basically, what you can do is then take the questions that you're getting and update the page accordingly. Exactly.

00:24:03 Filip Valica: Yeah, because you need to be doing that. Side two of like me helping out with projects is we, when we launch, regardless of if we're getting sales or not, I have to be looking at the conversion rates on the page

00:24:14 Khierstyn Ross: because Indiegogo Kickstarter will tell you how much traffic you're getting to how many buyers. And if that is less than 1.5 or 2%, there's some disconnect and you need to play around

00:24:24 Filip Valica: with stuff until you figure that out. Yeah, that's interesting that you use that one to 2.5% number because that's kind of what it is for ecommerce stores. If you've got a Shopify store or something like that that you're driving traffic to, that's your target.

00:24:35 Khierstyn Ross: get for conversion. Yeah, exactly, or else if it's 0.5, that something is wrong and quickly send your campaign page to your friends who you think would buy your product and say, please pick this apart and tell me where you think the disconnect is. Yeah, and I'm surprised that it's

00:24:48 Khierstyn Ross: that low because you would think that people are on Kickstarter, Indigo, to spend their money, and so you'd expect the conversion to be higher as if it were Amazon, maybe not that high, but

00:24:58 Filip Valica: certainly higher than 2%. Yeah, it's weird because I would think, I'm just making assumptions here, but I would assume that people approach Kickstarter the same way they do Amazon, like they browse for cool products. So the conversion rate would be like one to two percent. But if you

00:25:11 Filip Valica: are supporting a friend and it's your friend that sent you this campaign, then the conversion rate would be higher because it's a no-brainer that you know you want this thing already, and you're specifically coming there for that. So think it depends just where the source of traffic is

00:25:23 Khierstyn Ross: coming from. As for some of the things that you have on the page, I know people have come up to me and

00:25:28 Filip Valica: said, hey, you know what? I really believe in my product, but they're really introverted. They're

00:25:31 Khierstyn Ross: definitely product type people instead of people, people, I guess. And they're gun shy about putting themselves out there and saying, hey, this is who I am and this is what I stand for. Here's the

00:25:43 Khierstyn Ross: team that's involved because they feel like maybe they don't want to be that folksperson, so to speak, for their product. What would you tell that type of person? Are we talking about maybe being in the video with the founder story? Yes. Or even just listing their name and social

00:25:57 Khierstyn Ross: media information and everything as a founder on the page. I think you kind of have to.

00:26:03 Khierstyn Ross: If you don't want to be the founder, then you can be your company name, but you need to have a track record because what if people do like, I do this with marketing services whenever we get

00:26:14 Filip Valica: advertised that they say, oh, we can get so many backers for you. Like, don't trust them.

00:26:19 Khierstyn Ross: But if I'm doing reconnaissance on that, I can look and see, okay, let's go to their website. They don't have social media. They're hiding something. It seems like that's not trustworthy. So if you don't want to be like the face of it, at least have a legitimate company. or stand behind your team.

00:26:34 Khierstyn Ross: So instead of it being the David Tao show, it's more Pigeon Labs as your team, right? Bottom line, somebody has to stand behind it and they have to have a public front.

00:26:42 Filip Valica: To me, it seems like they're hiding something. And if something goes wrong with the project, customers and backers don't know where to go. So you need to have that public face. But I think it's a matter of how much you go into depth with it.

00:26:56 Khierstyn Ross: Like I've been on videos where the founder's doing the voiceover and he's in all the scenes. and I've done videos where it's just a different voiceover and there's just one scene with the founder just being interviewed about how he came up with this idea.

00:27:10 Khierstyn Ross: Yeah, so you bring up video, which is a good point. Do I need to be a gorgeous millennial and play a ukulele in the background for my video to be successful? Oh, God, no.

00:27:23 Khierstyn Ross: You want to be relatable to the masses.

00:27:26 Filip Valica: So if you have a weight loss product, why don't you just get someone who's not like a zero, blonde hair, nice California tan. You need to have someone who's actually struggling with that. Maybe it's the office worker that's 10 or 15 pounds overweight, average looking. When someone's

00:27:41 Khierstyn Ross: watching your video, they need to save them in that scene. They need to connect with that. So I think unless if you have a product specifically targeted at perfection, you should relate it to the customer. That's good. So I have a chance is what you're saying. Okay.

00:27:57 Khierstyn Ross: But you're cute. You can do this. I'm not a millennial.

00:28:00 Khierstyn Ross: that's a good point regarding video do you release just one video in the beginning and hope that you can ride that train out or are you trickling content as you would in other

00:28:09 Khierstyn Ross: types of online marketing that depends on the team but the newest project i'm on right now we're heavily doing video because it's a very visual product and so what we have

00:28:21 Khierstyn Ross: done i got this idea from eraz rubinstein who was one of the main members of the right cup and they needed to to get this press to start their campaign, but they didn't have a working prototype.

00:28:33 Khierstyn Ross: So what they did is they created a teaser video, which is like a 30 second clip, 15 minutes of showing how the product would work, and then 15 seconds of showing people using the prototype and getting their reactions. That's cool.

00:28:47 Khierstyn Ross: And so they use this to market and pitch press and get all that lined up before they could develop the final beautiful prototype. So they use video that way. And they got a bunch of press. they raised over half a million dollars. That's really awesome.

00:29:02 Khierstyn Ross: That you're able to do that even before starting your Kickstarter. What we're doing with Jamstack is video one that we released, because we've done two or three videos we've released now, and the first one was a teaser video, but we had this really ugly prototype, and it's an accessory that sits at the base of a guitar.

00:29:17 Khierstyn Ross: And so we showed someone playing the guitar with this cardboard box around the bottom with like a bunch of question marks, just to show it. And then we showed people playing it. So we kind of copied that idea and got a bunch of views. and then we saw that people love the video.

00:29:31 Khierstyn Ross: So why don't we try different content with what are the top two features that this product is going to do? And then we created a video around how quick and easy this thing is to set up apart from

00:29:41 Filip Valica: current solutions. So we use that and then get thousands of views on that and then use that as a lead gen for our email list. So we're going to be doing like we haven't done too much content, but we've done like

00:29:53 Khierstyn Ross: two or three videos total. And we're going to be doing like a Reddit AMA closer to. launch once we have that list because we're pumping money into Facebook ads using those videos.

00:30:03 Khierstyn Ross: So we've like, we tested the videos to see what people were receptive to. And now we know what we need to be doing to push that with advertising. That's great. What will the topic on the Reddit

00:30:14 Khierstyn Ross: AMA that asked me anything post be? Is it, hey, I'm launching a Kickstarter or I've developed

00:30:19 Filip Valica: this product. Ask me about it. So I don't know Reddit too well. I'm working with my business partner, who's social media expert, and she's going to be getting into the Reddit forums to

00:30:28 Khierstyn Ross: spike up that conversation over about a week or two. And then we will say, hey, by the way, we're releasing a new thing for guitars. I think you guys really like it, but I want to answer

00:30:38 Filip Valica: any of your questions. So I think we're going that angle, because it's more of a we want to put the product out there and do a demo and see what questions people are asking, right? That makes sense. And Reddit is a bit fickle. And that's why I ask you that question is because it's really

00:30:51 Filip Valica: hard to promote things on Reddit. Reddit encourages discussion, less promotion, and so you have to

00:30:56 Khierstyn Ross: come in with that right angle. Yeah, I'm not good with Reddit. I've gotten kicked off, I think, once or twice. I'm like, I wasn't being spammy, but. So anyways, I leave that to our social media girl. No, that's a good tip. If someone is struggling with taking their product to market and

00:31:11 Khierstyn Ross: they want to do a crowdfunding campaign, what are the top three tips or the 80-20 that they need to keep in mind to be successful. Maybe they don't have the budget of hiring somebody like you

00:31:23 Khierstyn Ross: or maybe they're not asking for a whole lot of money and they just want to prove a smaller product. I just feel like crowdfunding, people think it's the unicorn and the answer to all their

00:31:33 Khierstyn Ross: problems and it's not. Half of my job is screening out products and saying this is not right for crowdfunding. I think honestly with crowdfunding, you need to have a budget of around $10,000,

00:31:44 Khierstyn Ross: give or take, five or 10K, depending on your budget, to launch properly and build that audience and whatever. And if you don't have that, then maybe you should be looking to get government

00:31:55 Khierstyn Ross: grants or take out a small business loan to develop this privately and just put your product on Amazon. Right. Crab funding is great, but you need to have a budget. You need to have something that's

00:32:05 Khierstyn Ross: good or else it's not going to sell. So if it's a money thing, I would strongly just understand

00:32:11 Filip Valica: what you need to do to pull off a launch like this. If you can't do that, then maybe there's a longer approach you could take and even look at other e-commerce solutions to see if, you know, that's going to sell. If it's because you don't know

00:32:24 Khierstyn Ross: whether people want to buy your product, you can't just assume that because you think it's the best

00:32:29 Filip Valica: thing ever that people actually want it. Like I would strongly suggest actually identifying who

00:32:34 Khierstyn Ross: would buy your product and start talking to them and validate it enough so that you know that if you do have the cash to put in it, that it's going to sell. I'm really excited to hear you say, especially that last part, is because we've been preaching

00:32:47 Khierstyn Ross: that on this show just from a design perspective. So I'm glad at least we're in agreement. And we didn't prepare before the show and agree on our answers. So, um, no, we don't. I love this.

00:32:57 Khierstyn Ross: Like it just jump into it. Thanks again for being so transparent. Where can people go and hire you

00:33:03 Filip Valica: if they want to use you on their next campaign and get some help? Well, I have a full website of resources and there will be information on how to contact me. You can go to.

00:33:13 Filip Valica: crowdfunding uncut.com. I do have a podcast specifically for crowdfunding campaigns. And I've just released crowdfunding physical product launch checklist. It's just a free be on site. And it's

00:33:24 Filip Valica: will break down the timelines before you launch like three to six months out what you need to be focusing on. So you could do that. And then I do have like information on how to contact me. If you do have any specific questions about your campaign. Perfect. And it will definitely link to all

00:33:37 Filip Valica: of that in the show notes. So everyone can get that guide. Thanks again, Kirsten, for coming on the show. You've been a huge help, and especially for sharing some of the things that didn't work out because I personally learn from tests. I don't look at failures, failure. I look at it as a test that gave me some data.

00:33:52 Filip Valica: I love that. Thanks again for coming on the show. No, thanks so much for having me. And that wraps up our interview with Kirsten. Here are three takeaways that I think we can all apply to our businesses.

00:34:05 Filip Valica: Number one, get feedback early. So it doesn't matter if we're going to take this product or service to manufacture our or if we're going to crowd fund it, we must get feedback early in the process.

00:34:17 Filip Valica: If you go on the product startup.com, you can see that this is step five in the DIY product development blueprint. Do this before you finalize the design before you seek funding.

00:34:29 Filip Valica: Check out episode 12 to hear how the first seven founders that we had on this show did that. Many of the product launch failures that I have seen can be attributed to either the wrong product or the wrong audience. So one of the ways of getting quality feedback,

00:34:42 Filip Valica: back is to not ask leading questions. Ask why. Ask four or five times to really dive into that problem before you show that person a solution. Ask what they would pay for that. There's no sense

00:34:55 Filip Valica: in creating a product for an audience that will not pull out their wallet for you. But it certainly happens a lot and it's definitely happened to me, especially some of the companies that I've worked for. Get the person's information so you can follow up with them later. Build an audience that you

00:35:08 Filip Valica: can eventually tap into if you do decide to launch. Number two, crowdfunding is not the solution to all problems. I hear from many people who don't know their audience or who may have not worked out all the details of their product.

00:35:22 Filip Valica: Many automatically jump to crowdfunding as a solution for these. Yes, there are unicorn products that get funded on Kickstarter and people really rally behind and support them. But that is not the norm.

00:35:34 Filip Valica: Remember that these platforms are in the business of making money for themselves. They will not hesitate to bury an underperforming campaign. You have to bring the audience. You have to do the marketing.

00:35:45 Filip Valica: And above all, you need to know that your product, and I mean how it works, how it will be manufacturers, how it competes with others on the market, you need to know all of that is better than other existing products on the market.

00:35:59 Filip Valica: I look at crowdfunding as just a giant cash register. It's a way for people to give you money. It certainly does not solve any of the other things that lead up to that.

00:36:09 Filip Valica: 0.3. Reduce the perceived risk for backers, investors,

00:36:15 Filip Valica: customers. I emphasize perceived here because it's not about you or your product. It's about what others think of it and your pitch. Get in their head. Be proactive about addressing their concerns even

00:36:26 Filip Valica: if you don't agree that it's a risk. Reduce that friction for backers and early adopters to sign up. Show them why your product solves the problem better than anyone else and why you are the one that can deliver the solution. Give them a

00:36:39 Filip Valica: discount you will never run again detail what you will do with their money and speak their language and make sure that the photos videos and text resonate with your audience so how do you know that this is all connecting how do you know that

00:36:54 Filip Valica: people are agreeing with a message that you're throwing out there let's go back to take away number one ask them get feedback early so if you've got questions or comments I've put all the links that we've covered under the show notes

00:37:07 Filip Valica: posted on the product startup.com slash episode 33. Join me next time as I speak with myself. That's right. I'm going to kick off the new year with a solo show addressing some of the emails I get

00:37:21 Filip Valica: about motivation, procrastination, fear, limiting beliefs like lack of money, time, or skills. So if you sat on your idea for a while and you haven't done anything with it or if you've lost your momentum, this episode will be for you.

00:37:35 Filip Valica: So tune in next week to hear you. that.

00:37:39 Filip Valica: Lastly, I'd like to thank everyone listening who shared this show with their friends, their makerspace, their coworkers. I really appreciate your support. Many of the guests that we've

00:37:48 Filip Valica: had on this show have been as a result of the referrals and friends of friends reaching out. Thanks again for giving me your feedback. I'll see you guys next week.

00:38:08 Filip Valica: Thanks for tuning into this episode of the Product Startup Podcast. The show that teaches you what it really takes to bring your product to market and turn it into a big success. This podcast series is brought to you by Mako Design + Invent,

00:38:21 Filip Valica: the first firm in North America to provide global caliber end-to-end physical consumer product development to startups, inventors, and small product businesses. If you're looking for product development help on your invention, head over to Mako-design.com.

00:38:34 Filip Valica: That's M-A-K-O-Dign.com for a free consultation from one of Mako-Design for design studios from coast to coast. Thanks for listening, and see you next time.