When news broke last week that the crowdfunding campaign for the Ubuntu Edge phone had set a new record, raising $12 million in pledges, it looked like a big win for Indiegogo, the crowdfunding platform often considered a runner up to Kickstarter.
But when the campaign failed to meet its "crazy" goal of $32 million, the public was as quick to deem the campaign a failure as it had been to deem it a success.
Indiegogo co-founder and CEO Slava Rubin, however, insists the five-year-old company, which actually preceded Kickstarter, has a different definition of success. "They've learned from the market that people are interested, so it's been a massive success for them regardless," says Rubin of Canonical, the company behind the Ubuntu Edge. "I don't think we've heard the last from them."
Fresh off the Ubuntu Edge roller coaster, I spoke with Rubin about Indiegogo's history, its competition, and how it's eked out a space for itself in the increasingly crowded crowdfunding market.
When you guys launched, you were one of the only crowdfunding platforms around. Now, you're one of hundreds. How have you changed your strategy to deal with competition?
My co-founders [Danae Ringelmann and Eric Schell] and I came up with idea in fall 2006. We met up overlooking the Golden Gate Bridge for dinner, and we were talking about why access to capital is run by VCs or grant-writing organizations or banks. We had a naïve idea, which was: why not create a marketplace where anyone can fund any idea they believe in? We launched in 2008, and we didn't have the luxury of copying anybody. Everyone likes to talk about the word "pivot" these days, but Indiegogo really has stayed true to its vision from the beginning.
So what is that vision and how is it unique from other crowdfunding sites?
The thing that makes us unique is we're completely open. We're in any country in the world, and you can fund any idea. We have no judgment about your campaign. We believe that sort of openness is how you disrupt access to capital. We don't want to focus on niches. We want to become the funding utility for the world. We're putting the "crowd" in "crowdfunding."
And what does that mean exactly?
It's shocking how many people get denied or get put into an endless queue of being told their project's not good enough. A massive percentage of campaigns don't make it to the platform. As soon as you have a gatekeeper, you're eliminating the crowd. It becomes just like banks telling you you can't have a loan. There are very few platforms that try to do what Indiegogo is doing by letting only the crowd, and not a curator, decide.
The Verge recently reported that only about 9 percent of Indiegogo projects get fully funded, while 44 percent of Kickstarter projects get fully funded. You've said those numbers are inaccurate. Care to comment?
That information isn't accurate, but we don't share exact numbers for competitive reasons. The fact is, the majority of folks who raise money on IndieGogo are receiving money into their pockets. On Indiegogo, you can choose to have fixed funding, which means you have to hit your target to get paid, or flexible funding, which means you get your money no matter what you raise. So the word "success" to us is completely different than it is on other platforms.
And what about Kickstarter? How do you continue to grow with such a large incumbent on your back?
To say we have no competition would be silly and naïve. But we have a global reach no one else in the world can even come close to. We distribute money in 70 to 100 countries a week and do over one third of our volume globally. We also have a lot of firsts. We have the first crowdfunded baby, where a Florida couple used Indiegogo to raise money for in vitro fertilization. We have Oscar Award winning films. We helped people in Turkey get a full page ad in The New York Times. We're in virtually every country in the world. We have more campaigns, we've been around longer, and we have the largest backed campaign in the history of the world now. So, I'm pretty happy about our position.