Every week, founders come to the Munich Chamber of Industry and Commerce to learn about crowdfunding and get advice. For many, financing their idea is the main focus, but often the marketing impact a good crowdfunding campaign can also generate. The question quickly arises: How do I win the crowd for my project, and which channels can I use to reach them?
Which brings me directly to the topic of this article: Founding with the crowd. I was recently able to talk about this in Innovation Café of the Strascheg Center for Entrepreneurship I listened to a fascinating presentation by crowd expert Michael Gebert, and he hit the nail on the head. The central message: The potential of the crowd—this heterogeneous group of unknown people, spread across time and space—isn't limited to raising money. Quite the opposite! Anyone who only thinks about the crowd when it comes to money will have a hard time winning them over. I try to convey this again and again in my crowdfunding consultations. Because the crowd can be so much more: a source of ideas, a pool of knowledge, a co-creator, a product tester, employees, promoters, a fan community, and ultimately, a source of capital. And founders waste a lot of potential if they don't recognize this early on.
From consumer to presumer
Crowdsourcing is made possible by something that each of us has in our hands at least once a day: the mobile internet. Whether it's a smartphone, tablet, or laptop, the constant opportunity to participate has also changed the way we see ourselves as consumers and with it our fundamental attitude towards companies. The internet influences how people get information (anytime and anywhere), how they share experiences (not just with friends, but with thousands of others around the world), and how they communicate (directly, promptly, and publicly). This is transforming the passive consumer more and more into an active "presumer," i.e., a customer who wants to be involved in the design of "their" product even before it is actually launched on the market. Admittedly, this insight is not brand new. Some companies have been using community platforms, such as Tchibo Ideas, to leverage the crowdsourcing principle to design new products for years. The key advantages are lower failure rates, long-term customer loyalty, and rapid feedback from the community.
Perfection does not arise in a quiet room
So why shouldn't founders seek support from the crowd instead of tinkering away to perfection in the infamous startup garage? – The idea of the "lean startup" is a nod (see also our article "One Hundred and One Business Ideas" – Starting a Business with Crowdsourcing). There are now a multitude of platforms that enable every sole proprietor and startup to do what the big players with large marketing budgets are doing. For example, the Austrian startup Luma Active They relied on the "wisdom of the crowd." They developed their LED headlamp for outdoor enthusiasts together with a user group of 130 potential customers until it was ready for market. With feedback and suggestions from the crowd, they were able to tailor the product precisely to customer needs. The prototype was put through its paces by volunteer testers. Until Luma Active finally successfully raised the seed money for the first production run through a crowdfunding campaign. What made it different from other campaigns: The product already had a crowd of 130 Active Luma fans behind it, who in turn activated their network for "their product."
Creating something unique together
The real opportunity lies in creating a community around your product and giving people the feeling that they have played a part in creating something unique. This doesn't always have to involve a large-scale, all-encompassing, and expensive crowdsourcing campaign. Often, simply engaging actively with existing communities is enough, for example in forums, blogs, Facebook groups, and so on. Anywhere where the people who will later become your customers are, and who enjoy developing and advancing your idea together with you. Listening and allowing people to participate is crucial. Without these moments, a crowdfunding campaign ultimately remains pure one-to-many marketing. And that is anything but innovative, even if it has a new name like crowdfunding.
Research tip: The Crowdsourcing Blog provides a good overview of all types of crowdsourcing service providers and platforms.
