Mattia Di Stasi Interview: Demystifying Crowdfunding With David Kim

Today's video is a wonderful interview made to me by David Kim in his podcast. I was able to tell the story of my career, what brought me where I am now and the projects I managed helping more than 400 clients. Thanks to its clever questions I managed to explain and solve some crowdfunding doubts!

Before reading the article...

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1. HOW DO YOU HELP ENTREPRENEURS WITH THEIR CROWDFUNDING?

This is a very simple and yet important question because many entrepreneurs just prepare a couple of nice videos and just launch the crowdfunding but in the end, they don't get anything back! That's because the campaign materials are the last steps to take care of, the main thing is to do a proper pre-launch phase in order to create a community of people ready to back you because they already know who you are and what's your project. Having a buzz of people around your campaign is going to give you more visibility and the possibility that random backers are going to pledge your campaign is higher! That's what happened to my client recently, they created a community, they launched and then they got funded in the first 2 hours of the campaign, which triggered the Kickstarter algorithm and attracted more people to my client's campaign.

2. HOW LONG DOES IT TAKE TO PREPARE A CROWDFUNDING?

It really depends on your funding goal, it's not good to start preparing if you don't know your goal and what are your expenses. Based on that, you should understand how big your community should be, large goal leads to large community. I don't recommend exceeding 6 months for the pre-launch phase, because people will start to forget about you and will become ''cold audience'', I would recommend to launch after 1 or 2 months, it really depends on what's your goal.

3. WHAT ARE THE COMMON MISTAKES OF FOUNDERS?

1. Launching the campaign without having a proper pre-launch phase.

2. Don't calculate the margin on the rewards, you will end up selling your product with a discount price and even if you're going to sell millions in pre-orders there is the risk of fail and bankrupt.

3. Not invest in video production, which is fundamental.

4. Not investing in the logistic organization.

5. Don't show their story and who they are and focus just on the product. (If you let the people see what's behind the project it's gonna be easier convincing them and letting them be part of the project, this is going to give it better credibility.)

4. AT WHAT STAGE OF THE BUSINESS DO YOU RECOMMEND CROWDFUNDING?

It depends on the kind of crowdfunding you are running, there are 3 kinds of crowdfunding the donation-based, equity-based and reward-based. The reward based is the most common one, like Kickstarter or IndieGoGo platforms, equity crowdfunding is when people receive equity in exchange for backing and donation crowdfunding is just donation to support a cause.

If you want to run an equity-based crowdfunding, I don't recommend running it at an early stage, without having a customer base or traction because it will not be appealing to investors. Instead, when you're an early-stage, it's better to run a reward base that is gonna get better credibility to the investor's eyes, once you're generating revenues investors are gonna be much more interested and ready to back.

5. WHAT ARE THE MOST FAMOUS CROWDFUNDING PLATFORMS?

Regarding the reward-based platforms we're talking about Indiegogo and Kickstarter. The difference between them is the category of the campaigns, for example, e-bikes are very popular on Indiegogo, while on Kickstarter board games are more popular. Gofundme is for donation-based crowdfunding, it is own by Kickstarter, but they have a different business model. For equity-based there is Start Engine in the USA which is the leader for equity crowdfunding, then we have Seedrs for European countries. There are minor crowdfunding platforms, but they are more like investor clubs, like Crowdcube, but those are the most famous and popular.

6. IS IT POSSIBLE TO LAUNCH A CROWDFUNDING ON EVERY COUNTRY?

No, unfortunately, there are some platforms that only allow launching crowdfunding project if the company is based on a specific country, for example Start Engine won't let you apply if you're not US based, also Indiegogo and Kickstarter have a list of countries that are allowed to run the campaign on their platforms. Recently Indiegogo opened its platform to the Japanese and Chinese markets.

7. WHAT SHOULD FUNDERS DO FOR SUCCESSFUL CROWDFUNDING?

The very first thing is to define the target, I'm not referring to who is going to use the final product but who is going to back you during the crowdfunding campaign, so it's not simple but you have to define it in your mind and based on the target you have to build all your strategy around it.

WRAPPING IT UP

This is it for today, I really hope this interview helped you to clear your thoughts about crowdfunding, be sure to watch the full interview on the video above!

It can be tough sometimes to get the right piece of information among tons of things we hear about crowdfunding, but the most important thing I always recommend to any funder is to prepare the pre-launch phase, that's the path that leads to a successful campaign!

Always remember to create a community of interested people around your new product, gather them and keep these people warm with special and detailed content about your new product, in order to make them want to support you and be part of your journey.

If you want to analyze and prepare your pre-launch phase to launch your first product I’ve got you covered with my crowdfunding pre-launch free e-book called ''3 steps to success on Kickstarter and Indiegogo''. 

As always make sure to subscribe to my channel to stay updated on fresh new content that I’m gonna drop there.

Ciao ciao! 

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