The March 3 Entrepreneurial Marketing panel discussion on marketing to investing and crowdfunding featured Seattle Angel Conference’s Josh Maher, Robot Turtle’s Dan Shapiro, and Curious Offices’ Kelly Smith. Read on for a summary of the conversation.
For Dan Shapiro: Robot Turtles was the best-selling board game in Kickstarter history. What do you believe was the secret to your success in your crowdfunding efforts?
Dan: The premise for the Robot Turtles board game is to teach programming concepts to kids as young as three, in a format that engages parents as well. The success of the Kickstarter campaign was a convergence of factors. Dan had friends running Kickstarter campaigns who provided tactical advice (e.g., it is imperative that the campaign raise 25-50% of goal in the first day or two), a high level of media interest, and a talented artist who assisted with high-quality video production. His goal was to raise $25K – the board game went on to raise $630K.
What do you need to have to launch a successful Kickstarter?
Kickstarter provides preorders on an investment. Successful campaigns involve either a thing people want or a cause they believe in. It’s a conversion funnel and nothing else – it creates an urgency. In the case of Robot Turtles, 20% of people who watched the video converted. A company cannot do Kickstarter without a thoughtful, robust marketing campaign. A conceptual hook that can be described in one sentence is needed. The video should be no longer than 90 seconds. The page should include lots of information about suppliers, researchers, prototypes, etc. Then be prepared to dedicate a huge part of your life to it.
What factors should an entrepreneur consider when determining which type of investment support is right for their idea?
The size of the deal needs to be big enough (what constitutes big enough depends to a degree on the investor). What the capital is being used for is also important – is it for growth, team, or marketing? If ready to scale, angel may not be right at this point. The horizons are long, but there is interest in near-term gains.
For Kelly Smith: What do you look for from companies you’re investing in?
I look for entrepreneurs who are hands-on, highly attentive to the product, tenacious, and willing to take it as far as it can go. I look for someone with certain “X factor”, a compelling vision and the ability to recruit as well as sell – sell the product, the company – to investors, to employees, and to the customer. Getting the cultural fit right is very important: What do they value? What are they looking for from me?
A strong lead investor is needed to make a funding round come together. It’s vital to have someone with strong connection to you who can pull in a broad network – someone who can say, “I believe in this person and you should too.” People investing at the $25K level fill in the empty space.
Where do you find these “X factor” people?
The typical angel investor is making a trade-off between an investment in a startup and an investment somewhere else. Successfully getting investment comes through two categories – a relationship with the investor prior to and outside of the context of this company OR that the investor saw the deal less than a month before closing. Either have the infrastructure in place based on the relationship OR have metrics in place for a successful close.
Learn how to fine-tune your personal brand is the first step forward. Start to learn the middle ground between being too charismatic and too data-driven. Don’t underestimate the importance of social proof.
How do you reach out to investors early on – in ideation?
First of all, bad timing can torpedo your opportunity. Go as far as you can toward a viable product before meeting with investors. Take your ideas and make them happen. It’s easy to raise money for something that’s already successful. Think about how you can leverage whatever assets you have.
What’s your take on valuation?
Either raise enough money to get to profitability or get to a scalable milestone where VCs will give you money. Tech startup valuations are rising while established company valuations are declining – there’s some discrepancy there. Non-tech valuations not rising at same pace.
Tips for approaching investors and influencers at events:
- Do your research ahead of time. Don’t take up time at event, give them the hook, but leave it at that.
- Find something to make yourself to stand out.
- Focus your skills and excel at one thing.
- Kelly: I look for people who I know can ship what they tell me they’re going to ship. Throw yourself in knee-deep and figure it out. I respect people who can actually do what they’re pitching. I taught myself how to design and code in order to have control over my destiny. How are you going to cultivate yourself in order to get what you want?