This week saw a new crowdfunding record broken. $12.8 Million was pledged to support the development of a new mobile phone. Indiegogo hosted a campaign for the Ubuntu Edge, the first phone from the makers of the open source Ubuntu operating system. Over 27,000 people contributed between $20 and $80,000 (that was Bloomberg). 5,600 people pledged $695 each to get a phone next spring. While this broke through the records for crowdfunding, Ubuntu ended up pocketing $0. They didn’t reach their ask of $32 Million and so all the pledged money was returned to contributors. So the question is, did they fail?
Although they do not have money to show for it, they have proved an audience. Not only did these 27,000 people contribute, a number of others created indiegogo campaigns asking for funds so they could contribute to Ubuntu. Those people are saving up now and are hoping to get one if the phone launches in the spring. This is compelling data for an investor. Plus, Ubuntu has received massive press coverage since launching. Keep in mind, this is a computer operating system entering the space against Apple, Microsoft and Linux.
Even though Ubuntu lost the money, the campaign was wildly successful because they fulfilled on the key elements of a great croundfunding campaign.
1) Great videos
The video is the first impression that a small business makes on its potential donors. A great video is fun and informative, explaining the business without being boring. In a sense, it has to be an entertaining business pitch. The Ubuntu campaign had three videos and countless photos. It was absolutely clear what you were going to be a part of. They did a terrific job of explaining the offering and why you want to be involved.
2) Great products/services
Even if you have a great video, potential donors will not want to donate if your project is not inspiring. Donors on crowdfunding sites do not expect monetary gain from investing in the projects. Thus your project must actually be relevant to them in a spiritual or artistic way. Enroll your audience in how exciting the world will be once your product or service becomes a reality.
If people are not donating to your project, it may be because you have not put enough of your own emotional energy into it. This is usually the missing link that creates a connection between a project creator and its potential donors.
3) Great perks
Although the investors in crowdfunding projects do not receive any equity in the project, project creators usually have some kind of awesome perk for donors that hit a certain donation limit. This can be anything from a thank you Tweet all the way to a listing as an executive producer on the project. The more creative these perks are, the better. Many times, perks will actually be the part of the project that tips the attention of the donor in your favor. Physical perks always outshine virtual or “soft” goods. Ubuntu was offering the phone itself. Certainly exciting. This was also key for Pebble (shown above) the smart watch that raised over $10 Million on Kickstarter. For $99 you could buy one of the coolest watches on the market.
Ubuntu was a great success and should be paid attention to. The next news we will hear about them and the phone will be how much money they’ve raised from another channel.