Crowdfunding's creating an enormous shift in the startup community. Where once only angel and VC backed companies could possibly go forth and attempt to innovate, a new player is emerging and exploding onto the scene. The effects of these waves are being felt across the world as small yet sophisticated startups are emerging and creating the high tech, future focused products that will define tomorrow.
The Origins of Crowdfunding
Kickstarter and Indiegogo, the monoliths of modern crowdfunding have advanced at unparalleled rates since their inception. Launched in 2009 and 2008 respectively to help the little guys to raise funding for creative projects and passions, they've both grown to become billion dollar businesses. They're revolutionizing the way we build startup, launch products and even contemplate commerce.
But Why is Crowdfunding Crushing It?
Crowdfunding's early and explosive success could be the subject of entire economics dissertations. Instead I'd argue for simplicity. The pure and easily accessible nature allows individuals everywhere the freedom to create and innovate.
Access to information, means to manufacture, manpower and even capital are quickly becoming mainstream options for inventors everywhere. Ideas guys who would once have bawked at the incredibly long and painful process of pitching VC's are finding themselves with an alternative option...the crowd.
Herein lies the true power of Kickstarter. Imagine instant access to hundreds, thousands, heck millions of potential customers without an ounce of ad spend. This outlandish idea a mere decade ago is a reality for creatives today as early adopting backers and inspired forward thinkers peruse the popular pages and seek out the latest and greatest.
The New Lean Startup
After the internet bubble burst and DotCom crash crushed the hopes and dreams of entrepreneurs, inventors and VCs everywhere certain steps were taken to improve the odds of success.
We're all familiar with Eric Ries. His book, the Lean Startup, stands as one of the pillars of modern money making. The principles of efficiency, iteration and rapid customer discovery drastically altered the software and startup scene.
Hardware however remained unfortunately unchanged. The incredibly prohibitive startup costs for manufacturing and product design have always artificially excluded small startups and founders. This dynamic is changing as the crowd controlled capital comes into play.
This evolution of hardware startup is bringing makers, hackers and DIYers everywhere out of the wood works and into the limelight. These handy, hands-on individuals have worked tirelessly perfecting, prototyping and testing their passion projects in the garage, basement and wherever else their spouse sought fit to allow.
Suddenly with crowdfunding their creations are now feasible. The businesses they never dreamt of building are within reach and it's resulting in unprecendented innovation in the hardware space.
The Innovator's Era
Now is the time of change. Inventive entrepreneurs everywhere are attacking the stagnant sectors of corporate and unveiling inventions as we've never before experienced. The examples truly speak for themselves. The Pebble Smartwatch raising in excess of $10 million. Oculus' $2.5 million before a $2 billion acquisition two years later.
The startup landscape is changing. The time is now for product creators to shine. Funding, building business or even exploring incredible other opportunities the campaign creators of today are turning the business world on it's head. From Google, Nike, Amazon and Shark Tank I've seen past podcast guests and consulting clients frequently receiving orders, offers and unexpected campaign assistance as they work to innovate.
And in the age of acquisitions where big businesses are turning away from risky ventures and costly product development, startups and crowdfunding campaigners are stepping up to fill the void.
How this will play out is anyone's guess but everyone from VC's to Fortune 500 execs are caught in a whirlwind they could never fully anticipate or understand. Not sure how it'll all shake out but believe me folks we're in for a wild ride.