crowd funding for creatives - thedesigntrust.co.uk · investors for tax breaks under the government...

Crowd Funding for Creatives

Presented by Alison Lewy MBE

mentoring | business support | access to fundingAuthor of Design Create Sell – a guide to starting up and running a successful fashion business

www.fashion-angel.co.uk

©Fashion Angel 2016 1

http://www.fashion-angel.co.uk/

Background

Over 15 years running my own labelWorked with high end designers including

Matthew Williamson & PreenCommercial Director of Fashion And Textile

MuseumFounder of Fashion Angel – mentoring, business

support & access to fundingDeliver Partner for Start Up Loan SchemeAuthor of Design Create Sell – guide to

starting and running a fashion business


Agenda

An overview of crowd funding

The benefits crowd funding can offer

A snapshot of some of the most popular platforms

Planning a campaign

The costs involved

Case studies of successful fashion campaigns

Tips on what it takes to succeed


What is Crowd Funding?


Crowdfunding - n. & v. /kroud/ - /fəndiNG/

The pooling of small contributions of funds from a large groupof people (the crowd) for the purpose of making somethinglarger happen

Crowdfunding Models

Donation/Rewards Based

People contribute money to a project or business with an understanding they will receive a reward or incentive in return.

Launched in 2009 - world’s largest reward based crowd funder, recently passed the milestone of $2billion pledged; over $75 million has come from the UK.


Crowd Funding Models

Equity/ Investment Style • People contribute funds to your crowdfunding campaign and in exchange become

an investor with shares

• First crowd funding site in the world to target investors prepared to take equity stakes in small businesses. Raised funding of more than £145 million since launch in 2010, with more than 264,000 investors registered

• Launched 2012. Focuses on start-ups, and has recently expanded into Europe/US.

• Both fully regulated by the FCA and the companies it supports usually qualify investors for tax breaks under the Government’s SEIS or EIS scheme


Why do people invest in crowd funding?

1. They care about the greater purpose of your business, your “why”.

2. They care about the physical rewards or perks that you’re offering.

3.They want chance to pre-order products and servicesbefore available to general public.

4. They connect to the creativity of your campaign and want to feel like part of a community in supporting you.

5. They think your idea is worth investing in and areinterested in profit or equity in your company.


Why should you use crowd funding?

• Suitable for raising small & large amounts• Gets validation of product/service• Helps raising funding without giving away any of your company• Help build your brand and gather loyal customers

Reward campaigns often for specific activity:-• The launch of a new collection• The organisation of a fashion event/exhibition/catwalk• A photo-shoot• The production of clothes, bags, jewellery…• Pre-order• A shop opening



KEY STEPS Decide how much you need Research and learn Put together a budget- there are costs! Write your campaign pitch – be clear on what you want and

why! Create your video pitch/campaign teasers Create your rewards Create your marketing plan Set up your website/social media pages Create content Start spreading the word!



DO YOUR RESEARCH

Identify 10-12 successful campaigns to similar target market – set up spreadsheet to compare:-

• Number of rewards offered

• How rewards were described/presented

• Most popular funding tiers by value• Look at their video pitch & info supplied

• How long did campaign run for?

• How long did it take to reach target?

• Look at social activity


The Rewards

Work out most popular & profitable tiers

• Ensure your costs are worked out to supply, fulfil & deliver.

• Price rewards fairly – donators must feel they are getting something special

• Make perk names and descriptions clear, & include images.

• Build excitement by offering limited editions/limited time – especially for larger tiers.


Case Study – Isolated Heroes


https://www.kickstarter.com/projects/1596330752/isolated-heroes-sassy-sequins-and-luxury-faux-furs/description

https://www.kickstarter.com/projects/1596330752/isolated-heroes-sassy-sequins-and-luxury-faux-furs/description

The Rewards

EXAMPLES• Thank you & Credit – on platforms, line sheets• Merchandise & Accessories – branded promo items• Tangible Product - pre-orders. Offer for a discount or a limited time

only to increase awareness and spark demand.• Early Access – chance to get product in advance of open market• Product Enhancements - personalisation or unique to the donator. • Offers with partners – team up with others!• Meet & Greet - grant exclusive access to you and team.• Participation- name product after backer?• Parties & Events- invitations ,back stage passes, tickets, exclusive

dinners…..


The Pitch

WRITE YOUR PITCH

• Make it personal! – tell a compelling story!

• Explain why you’re fundraising and what you need money for.

• Be transparent - give breakdown of your project costs

• Use video/images in your pitch

• Tell them about yourself and team

• Proof read!


The Video

• Create an emotional attachment – you should front it!

• Make it personal - take people on your journey in the spirit of collaboration.

• Study others. Look at other successful campaigns and watch their videos for inspiration.


The Video

Video and audio quality are important – if using smartphone use a tripod to keep stable & audio must be clear. Record in a well-lit room

Don’t try to wing it - write a script and make sure it hits all the key points of your crowd funding campaign

Mention only two or three rewards – you want to get them excited & going through an entire list of rewards is boring.

Keep it short and end with a bang! – no more than 3 mins

Don’t forget ‘the ask.’ - be sure to ask for a donation and for help spreading the project to the viewer’s friends and networks.


The Costs

CREATE A BUDGET

• Marketing/PR

• Video/Images

• Launch event

• Product costs

• Distribution

• Platform fees: 4 – 9% success fee + payment handling


Catalyse Your Network


The Crowd is King

• Important to engage ‘core’ supporters to get involved early – has a snowball effect

• Approx 44% projects are successful on Kickstarter – fashion lowest at 25%

• Kickstarter stats show likelihood of success in reaching goals are x 10 higher once half of their funding goal is reached

• Successful campaigns raise, on average, 49% of their goals during the first and last 10% of the campaign

• Successful Kickstarter projects are ones where the creator uses a combination of friends, family, extended networks and media to generate interest in project.

• 84% of Kickstarter pledges come from people via an external link; only 16% from people browsing Kickstarter and found project


Marketing Strategy

Create early momentum!• Campaign and create a buzz around your campaign

before you launch• Send direct emails explaining campaign and with pitch

link, to galvanize all your friends, family & contacts to contribute as soon as you go live

• Organise a campaign launch event• Promote on social media pages and consider setting up

separate Facebook one for campaign• Create Instagram account - behind the scenes,

products, press• Compile a list of relevant media contacts/key

influencers & send press release


Marketing Strategy

Create early momentum!• Add a pitch link to the bottom of your email signature

and embed widget • Get feedback on perks and campaign before you go

live! • Remember to thank contributors – make them feel

special. Ask them to post updates on their social pages• Post links to any press received • Draw up a social media marketing plan and share your

pitch link regularly on platforms - use scheduling tools eg Buffer, Hootsuite to post regular updates


Case Study - Carreducker


https://www.kickstarter.com/projects/590051348/new-winkers-resort-shoes/description

https://www.kickstarter.com/projects/590051348/new-winkers-resort-shoes/description

Social Media

Twitter • Use trending hashtags to raise awareness• Always include campaign link in every post on every

platform• Ask for RT’s• Target people that have a specific interest eg stylists• Promote the perksFacebook• Use personal and dedicated pages• Ask for feedback and engage• Include ‘sneak peak’ images/videos• Promote perks


Social Media

Instagram• Take pics as campaign grows – product, creating perks,

in studio.• Follow those that may be interested in your brand• Tag words & pictures that relate to campaign

Pinterest• Use to build campaign vision and brand• Pin pics of perks and anything visually interesting• Follow other pinners • Pin videos/images that lead back to campaign• Include campaign link to profile page


Crowdfunding

Post campaign• Keep contributors updated with perks – inform if

any delays• These are also your future customers – build a

database• You may run more campaigns – note what

worked or didn’t work.• If you meet your target – another opportunity to

shout about your brand and get press.• Give contributors a big thank you!


Key Considerations

• It’s not an easy or quick option – needs hard work and careful planning

• Be prepared to embrace the crowd.

• Research which platform right for your purpose.

• Have a realistic budget in place and you understand product & distribution costs

• Timing is crucial – aim for payday!

• Make sure you can supply on time – takes time to build a good reputation but it’s quick to get bad reputation

• Think carefully about funding target - most platforms operate Fixed Funding - you only get funded if you reach your target. Some do allow Flexible Funding eg Indiegogo

• Does the platform allow overfunding? Can be best to run multiple smaller campaigns

• Campaign length- on Indiegogo 40 days most successful – hard to keep momentum for long campaign

.

• Once campaign funded – find out how long to receive funds


Case study – Little Black Dress


https://www.kickstarter.com/projects/emmahuntlondon-lbd/the-little-black-dress-collection-by-emma-hunt-lon/description

https://www.kickstarter.com/projects/emmahuntlondon-lbd/the-little-black-dress-collection-by-emma-hunt-lon/description

Case study – Louise Korner


https://www.kickstarter.com/projects/louisekorner/l-o-u-i-s-e-k-o-r-n-e-r-contemporary-womenswear-la?ref=nav_search

https://www.kickstarter.com/projects/louisekorner/l-o-u-i-s-e-k-o-r-n-e-r-contemporary-womenswear-la?ref=nav_search

Case study – Strathberry


https://www.kickstarter.com/projects/1884938840/strathberry-luxury-bags-and-accessories?ref=category_location

https://www.kickstarter.com/projects/1884938840/strathberry-luxury-bags-and-accessories?ref=category_location

Case study – The Felted Duck


Thank You

Mentoring| Business Support |Networking

Access to Funding

for fashion industry entrepreneurs

www.fashion-angel.co.uk [email protected]

www.facebook.com/FashionAngelBusinessSupport

Follow us @FashionAngel1

www.fashion-angel.co.uk


http://www.fashion-angel.co.uk/

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crowd funding for creatives - thedesigntrust.co.uk · investors for tax breaks under the government...

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