Around 6 months ago, I wrote a post on this subreddit that resonated with a lot of people here. I’m typically not a huge content creator, but that last post created a bit of value for people just starting out on their journey as entrepreneurs. Since then, I have had the most significant and impactful few months in my life as an entrepreneur as a direct result of my experience successfully raising over $360,000 on Indiegogo (around 1000% of our funding goal)

But first, here is a bit about my history as an entrepreneur. (Sorry for being redundant, as I am copying and pasting this mini-bio from my last post) I have been the founder of 3 companies, and a partner (but not a founder) of one.

• An 8-figure business
• 2 x 7-figure businesses
• 1 x 6-figure business

First Company: BizMedia Digital Video Agency did 60k in revenue in the first year, 600k in the second year, and by the third year was a 7-figure business from there on out.

Second Company: dbrand Vinyl skins for smartphones, laptops, gaming consoles etc. Grew this business to almost an 8-figure business within 3 years before being bought out by the founder (and one of my best friends).

Third Company: Hitsu Socks Online and retail manufacturers of funky socks designed by street artists. An epic journey that had me cycle through 4 different partners until I found my current partner who is an entrepreneur far beyond me who has taken this from a struggling, money losing (but fulfilling) side project into a real business with real legs which is finally a business doing 6-figures. But it was a real grind to find the path with this one. Happy to say it's on the path to real growth.

And my fourth (and now full-time focus) business: Unbound Merino This is the subject of this post and we on track to reach 7 figure in our first year in business (if including the crowdfunding revenue)

I wanted to write this post to share everything I learned in the process of launching a successful crowdfunding campaign.

I wrote this post to gather my thoughts like I did in my last post. It is a list of my reflections on every aspect of our campaign from the initial idea, to execution and right through to fulfillment. Before launching, my partners and I read everything we could find online about crowdfunding. If you are thinking about launching your own campaign - I advise you to do the same. What I have written below is mainly the stuff I couldn’t find online and learned from experience. There is a lot more to creating and running the campaign that isn’t included, but this is a compilation of the lessons I learned that the internet didn’t prepare me for. Hopefully my experience adds some additional perspective to the many great articles / blog posts / guide books that are floating around on the web already. I tend to ramble and am sure I’ll miss some details – so please let me know if you have any questions. Happy to answer them!

How We Found Our Manufacturer:

Finding a manufacturer is no easy task and was by far the most nerve-racking and worrying part of our whole launch. We needed to prove that we had potential to be a great buyer (even though we weren’t sure if we would even put in a single order), but also hold them to a high standard. We chose to manufacture in China because in my previous experience manufacturing in Canada, the US and China with my sock brand - China consistently housed the best manufacturers we worked with, hands down. The stigma of Made in China meaning it’s made cheaply or poorly or that the factories are sweatshops full of underpaid children is complete and utter nonsense. Manufacturing in China CAN be cheap and shoddy (if low cost manufacturing is what your goal is) - but they also have the most advanced production facilities on the planet. To us, finding the right partner in China was a no brainer.

Of course - we turned to Alibaba to find our manufacturer. If you have a strong network in the world of manufacturing, you may not need Alibaba. But we needed it. We had no connections to any manufacturers who work with merino wool or who make shirts / underwear. Socks we had covered from our other business. And so the digging began. Our goal was to find a manufacturer who didn’t require minimum order quantities that were unrealistic to us. Between 1000-3000 units per style was on the low end, and that’s the ballpark we were playing in. We really assumed we would need to be closer to 500, but we figured we could always ask whoever our manufacturer would be to start with only 500 units if we were already ready to order. We would just tell them that later.

Here is how we started.

We searched through as many different manufacturers as we could. Searching for ‘merino wool shirts’ to start. We would click open a new tab for every manufacturer who looked even remotely fitting. Browser window after browser window was opened until we had way too many tabs in each browser to count. We must have opened a few hundred tabs of potential good fits. And then, one by one we looked through their page to see if we liked their photos, pricing, believed they were established enough and let our gut feeling guide us a bit. After closing the tabs of those who were clearly not a fit, we reduced our list to around 80-90 manufacturer pages. Now it was time to start reaching out. We created the following questionnaire which we sent out to every single manufacturer that still had an open tab in our browser. Obviously this questionnaire is unique to our production needs. We just tried to write it so it appeared we were thorough and were willing to fly to China to meet in person.

Quantity Need: 3000 - 5000 Piece/Pieces (this was bullshit, but we had to look like a worthy buyer)

My name is Dan Demsky.

I am an entrepreneur from Toronto, Canada. I am the founder / partner in 3 businesses (1 recently sold): Hitsu Socks (www.hitsusocks.com) bizmedia (www.bizmedia.com) dbrand (www.dbrand.com) --Exited

I am looking to start a new business retailing Merino wool underwear and came across your page.

I have a few questions.

1) Do you have different styles / fits / colours for your shirts that aren’t shown on the Alibaba page?

2) Are they 100% Merino Wool?

3) Do you have any Merino Wool blends with other materials?

4) How much are they at your lowest minimum order quantity?

5) What's the cheapest price you can offer and what quantity would need to be reached to get that price?

6) How long does it take from the moment an order is placed to fully complete production and to have it on a shipping container on it’s way to Canada?

7) Can I visit your factory if we decide to do business with your company? Where exactly is it located?

8) What are the options for branding our shirts? Heat transferred logo? Stitched label? Please provide pictures of all the readily available options.

9) Where is the wool sourced from? Can you let me know all the details about your wool supplier and the certifications of the wool quality?

10) Can we order samples? If so, what would the cost be for 10-20 sample pairs?

I believe that's everything for now.

Please provide us with a quotation and let me know if you’re available next month for us to visit and inspect the factory should we decide to do business together. We are flexible on dates but do require a factory if possible.

I look forward to hearing back from you. Thank you!

Almost immediately the responses started to come back. Some within a couple hours. We waited a few days and started to read through them. And we put aside those that responded with the best English (after all, we need to be able to communicate effectively), those who seemed the most honest, the most eager and of course - those who were very welcoming to have us visit. It’s very important for me to meet people i do business with, and to see the environments in which our products are made. The eagerness to host us in China meant something to us. Even though we weren’t really sure if we ever really would meet these people, we needed to know that the door was open to their offices and factories.

Out of 80ish questionnaires sent, we liked around 10 of the suppliers that responded (a bunch were the same manufacturer with multiple profiles). So the conversation with those 10 continued. We got on skype calls, explained what we were looking to make (telling them we were self funded and this was a new business). And started to ask questions about costs to produce samples. A few refused to make samples without a deposit. And around 5 of them we continued to be impressed by, were willing to make samples to our exact specs. Once we confirmed that they would make our prototypes we asked them to send samples of their clothing (not made to our spec) but made with the exact wool that they would be able to provide us. Of course a lot of these styles were pretty ugly and weird fitting - but we needed to test the quality of the material itself. All 5 provided samples and we started to try them out and see if the material could be pushed to the limits. We set up an exhaustive testing period where we ended up nixing a couple of manufacturers due to unsatisfactory fabric performance and ended up choosing 2 manufacturers who just hit the bullseye on all marks.

We began to work with both of the manufacturers we loved to develop prototypes, which included a self funded visit to China to go over the design and to meet in person. Meeting in person makes the world of difference. I believe you should know your manufacturers to observe their facility, to assure that they run an ethical operation, and to know where to find them if they screw you! That may sound cryptic, but it helps me sleep at night! If we were to be successful in crowdfunding, we would have many many people counting on us to deliver a high quality product. Having an in person relationship changes the level of accountability in my mind.

I’m not going to elaborate more on the design and prototyping process because it’s only relevant to clothing and will change drastically if doing a product made of metal or plastic or something. But for clarity's sake the whole process I just described above seems pretty straight forward, and it is. But from the time we first sent out messages on Alibaba to the day we launched our campaign was over a year. Prototyping (and sending samples overseas back and forth) and relationship building is not a quick process. It takes time, patience and commitment. We are proud to say that we have been back to visit our manufacturers 3 times and have a truly great, trusting and meaningful relationship with them. You can’t create a bond this strong in a month. We’ve earned each other's trust and respect and understand each other's goals. Put the time in. It’s important and it’s rewarding. It also doesn’t hurt that we’ve now purchased hundred’s of thousands of dollars of inventory from our suppliers in less than a year. That helps cement a relationship that started on nothing but our good word and bit of trust / hope.

Fast forward past our prototyping stage to having our own product in our possession (only a few pieces of each SKU) - we were ready to move ahead and try to bring the product to market. We knew we had an amazing product on our hands, but that’s only half the battle. We had to convince a bunch of strangers that we had something special.

Kickstarter vs Indiegogo:

This is a question we get asked very often. Why did we pick Indiegogo over Kickstarter if Kickstarter is bigger and more well known? Truth be told - the only reason we did choose Indiegogo is because we had our good friend help mentor and guide us in our early stages of the campaign and he just outright said “you’re doing this on Indiegogo. I know people there and it’s going to be better if you have people on your side”. OK… Whatever. I couldn’t find a compelling reason to reject that so we went with Indiegogo. That’s the only reason we chose them over Kickstarter. But that ended up really working in our favor.

Working with Indiegogo was an absolute pleasure. Perhaps because they are smaller than Kickstarter. It’s often the case that those in 2nd place have to work harder, and Indiegogo definitely works hard for their campaigners. They took my phone calls, they provide insights, they visited us in Toronto (they were in town but made a pitstop to say hello and shake hands) and most importantly they cut a deal with us that if we got a certain amount of backing, they committed to feature us in their marketing email. This may not seem like much, but at the end of the campaign, their promotion was easily worth over $100,000 to us. Their email list is big and it’s full of people who are into crowdfunding campaigns. To this date they’ve featured us 4 times and it’s made a dramatic impact. I sometimes wonder if we decided to go on Kickstarter, would we even be a blip on their radar? Maybe… Maybe it would have been twice as big of an outcome. But I don’t even care at all. Indiegogo gave us the attention and support we needed and a marketing boost we couldn’t have ever known was coming our way. I’m very grateful to them for all they’ve done for us and no - they have no idea I’m writing this. I’m not paid to write this. But I genuinely think that there is a serious advantage to working with Indiegogo if you want to be supported by a company that cares.

Forget Stretch Goals

Just a quick word on stretch goals. For those who don’t know what stretch goals are, they are perks that effectively get ‘unlocked’ when certain campaign goals are hit. For example, you may have 5 perks available in your campaign, but if you hit $100,000 you unlock the 6th perk. Some campaigns have many stretch goals that get unlocked as the campaign reaches many milestones. We had many people tell us we should create stretch goals like little tchotchkes that travellers may like. Like a travel clothing hanger or a laundry bag (someone actually suggested this to us which is likely the worst idea for a campaign centered around not having to do laundry). People also suggested simply adding new colour t-shirts as stretch goals beyond our 2 colours available in the campaign.

This is just my opinion, so take it with a grain of salt. But I have no clue why anyone would ever have a stretch goal. If a backer backed your campaign because they want the product available to them at the time they backed - why do they need a stretch goal? And if you think people will share your campaign and force their friends to buy so that the campaign can ‘unlock’ a stretch goal - you’re kidding yourself.

Again, assuming you’re selling a physical product -adding more SKU’s as a stretch goal just adds costs, chops up your bottom line, adds complexity to your initial inventory order and pretty much makes no business sense whatsoever. I am yet to hear a good reason why anyone would have a stretch goal. The reason I’m mentioning this is 1) to hopefully stop someone from thinking they should have a stretch goal, because they don’t need them. And 2) because I’m curious if anyone out there can give me a good reason why stretch goals are even a thing. Makes no sense to me.

Having a fake campaign goal

In our campaign we said we needed to raise $30,000 to launch the business and get to manufacturing. The reality is, if we raised less than $75,000 it would be near impossible for us to launch. And if all we made was $75,000 we would likely just squeeze by and not be set up well to transition into a real business after the campaign.

But we made our campaign goal much smaller for a reason. And that is because Indiegogo gives preferential treatment to those campaigns who can raise 30% of their campaign goal within the first few days of their campaign. We wanted that treatment, and the easiest way to do that was to make 30% of our goal a lot smaller, and therefore easier to achieve. If you are using Indiegogo, talk to people from Indiegogo about what it takes to become a trending campaign and what it takes to get featured in their newsletter. I’m not the only person they cut a deal with saying 30% raised will get you a newsletter feature. I believe it’s a deal (or reward) commonly given to campaigns who have quick growth. In our case, we knew $10,000 as FAST AS POSSIBLE was the goal. After that, we would have a bit more support from the platform, and we focused all our energy on that step. Another reason we wanted to lower our funding goal from our true goal of $75k was for the optics of being close to or fully funded. When we got to $30k, we were now a ‘funded’ campaign. This made us look successful and success breeds success. All of a sudden we became newsworthy to various travel and business blogs, even though we were actually still short of what we needed to even be able to place an order with our manufacturers. We were featured on TV, in magazines, blogs, etc. All of this just helped us blow past our real (but secret) goal and then some. We ended the campaign having raised almost 1000% of our funding goal. In reality it was around 400%... But still an amazing achievement. We do strongly believe pretending to be successful earlier on helped us really end successfully.

The First $10,000 should be the easiest

As I mentioned above, we were doing whatever we could to appear like our campaign was killing it right from the get go. And to lock in our newsletter feature with Indiegogo we needed to get $10k in the coffers as fast as possible.

We had no idea if people browsing Indiegogo would care enough to back our campaign, so we made sure that we could raise $10k without relying on Indiegogo’s regular web traffic. We had to get our own traffic to the campaign, and it had to be people who we could count on to support us. And who better to lean on than friends and family? The answer is nobody!

Now, getting your mom, siblings and best friends to back your campaign is easy, but that alone won’t get you $10,000. You need to be able to get friends and acquaintances to back you as well if you want to really get momentum. The challenge is that there is so much noise on social media, that posting about your campaign, or even individually messaging friends may just be drowned out by everything else going on on their newsfeeds and in their inboxes. What we did is we created around 200-300 videos where we individually asked our friends (each friend gets a video) to go check out our campaign and asked them to support us. The thinking here was that a Facebook or Twitter post can easily be ignored or missed. And that a mass message that is copied and pasted and sent to a bunch of friends can also easily be read and ignored. But there is something different about receiving a video that is custom made for you named YourName.mp4. And I don’t mean a complicated, edited video. I mean you turn your webcam on, hit record, one take, done. Export, upload to YouTube as an unlisted video and send to the person you made the video for. Here is an example of a video we made. Again, this is one of a few hundred that was made in the days leading up to and the first few days of the campaign:

Click to watch video pitch I sent to a buddy

If you made it through the whole video, I’m sure you were bored. Looking back I was a little dull, but it was hard to do a lot of those. My partners and I ended up staying up all night drinking beer pumping these out which made it more fun, but those videos became a bit belligerent and will remain private haha. The key takeaway here, is people watched these. They’re hard to avoid. And people enjoyed seeing a video made for them. Especially ones with inside jokes, and some silliness. Our batting average was HUGE with this initiative. Most people who watched the video were happy to help us by backing the campaign.

One last detail about the friends and family blitz we did in the first couple days. Don’t have a ‘thank you’ perk for $5 that gives people an opportunity to help support without them actually receiving product. It’s a really nice thing for people to do, but if you give people the opportunity to kick your campaign $5, many may do that instead of buying one of your actual perks. That won’t help you. Don’t offer that. Sell your actual product. Our cheapest perk was $50. If people didn’t want the product or didn’t want to spend $50 or more - no problem at all. A few people didn’t respond. A few people said they just don’t have the money to be spending on wool shirts… We had no expectations of anyone. But we decided we would rather ask, and have some people not contribute at all to the campaign, than have an easy $5 thank you option that potentially would take away from lots of $50, $100, $200 backers. We are very proud of the product and were happy to sell it to anyone (family included). The benefit to them is that we had all sorts of super early bird prices in our first days, and most of them actually just want to help out. And we made sure to express gratitude to each and every single one of our friends / family members individually for their generous support. We wouldn’t have gotten off the ground without them.

For the record, we raised over $20,000 in the first 48 hours. This was 95% friends, family and acquaintances. After the first few days the orders started trickling in from all over the world because we were a fast growth, trending campaign.

Advertising - turns out it’s worth it!

At first we were reluctant to approach a crowdfunding advertising partner, but when all was said and done - I think it’s a really worthwhile investment. Throughout our campaign we spent $10,000 on ads which was around $9000 more than we initially budgeted. But once we got a taste for it, saw that it worked pretty well, we decided to pump more money into the campaign since we saw a clear and direct ROI.

For those of you who don’t have $10,000 to put into ads, we didn’t really either. We ended up putting a couple thousand dollars of our own money in (around $3000 total) to start, then agreed to pay the other $7000 to our advertising partner and they were gracious enough to put a bit in trust in us since they saw the campaign was clearly making money. Not sure if that’s normal practice from them - but they were really cool and helpful. They also helped negotiate and early release of funds from Indiegogo (halfway through the campaign) so that we had the budget to put into more ads as needed. It was an easy decision to put more into ads because we had a weekly report on the ROI. The way our advertising partner worked is they took a $500 set-up fee, then they worked entirely on commission. They create the ads (with our photos / assets) and they spend our budget for us to try and get the most return for their spend. Since they are working entirely on commission - they obviously want to see us succeed. The best part about working with an ad partner is not just the help with creating and deploying ads (something we would have no clue how to do effectively) but more importantly, it’s the access to their lists of people that they target with their ads. Their lists are ripe with people who truly love to back crowdfunding campaigns. Below is a look at what a weekly report looked like from our ad company. As you can see, most of the backers came from their ‘Master Custom List’ which is their exclusive list of people they’ve built over years of doing ads in the crowdfunding space. Another thing you’ll notice is the weekly metrics at the bottom of the spreadsheet. We specifically asked for these numbers so we could paint a picture of our true ROI. This is what we required of them which they happily provided:

*Total revenue for the week: Obviously we had to compare the revenue generated to make sure it was more than our cost. *Total Costs: This wasn’t just for the cost of the ads, we had to pay the ad company a 10% commission for sales they directly drove to our campaign so we asked them to give us the true cost of our ad spend including their share. *Margin: Because I was too lazy to use a calculator myself, asked them to add it. *Average Customer Value: Self explanatory, the average revenue generated per backer that they drove. *Average Customer Value After Fees: That same average but factoring in the fees that will come from Indiegogo as well as bank/PayPal fees. *True Take Home Value: All things considered, this is what a transaction would net out to once everyone is paid. This is the number that I had to really dwell on, because the next number that mattered in the equation was the cost of goods sold. Something that I would have to consider importing fees on, duties, shipping, insurance, etc etc.

All things considered, the money we were left with wasn’t insanely profitable, but week by week we got to decide if it was worth continuing. Week after week we decided that continuing with them was a ‘hell yes!’ because we still made a bit of profit at the end of the day, but also acquired a new customer who may be a customer for years. We are yet to determine what the lifetime value of these customers are, but we figured the more the merrier. The other sweet part of the deal was knowing that they were driving much more traffic to our campaign page than we would be able to alone. This helped us sustain our campaign in the ‘trending’ category which resulted in lots of other backers that they didn’t take commission on because we can’t know for sure if they directly caused the sale. They are fully aware of this, and were happy either way. Although impossible to measure, if you factor in the trending and the lifetime values of these backers - this was a no brainer decision. I highly recommend saving money to invest in advertising. This is not a paid endorsement and they don’t know I’m writing this. They did a good job and I would recommend them happily. If you want to know who we worked with DM me. Happy to make an intro.

Ciick to see screenshot of weekly sales report

Early Bird Prices

Early bird prices are another good way to keep momentum going at the early stage. In our case we used them to get a little bit closer to our (real) fundraising goal. Our ‘super early bird’ pricing was so cheap that the profit we made on these sales was negligible. The fact of the matter is we needed to reach a minimum order quantity to go into production, and having a one time, limited deal helped us get those impulse buys that got the money in so we could get moving on our manufacturing. Once we were past the minimum order quantity, we moved the campaign to our regular price. Use the early birds to get the money in, but then focus on profit. At one point we went from a pitch to a real business, and real businesses make profits. We didn’t have many flash sales (I think just 1) and we sold product at regular price for the large majority of the campaign.

The Harsh Reality of Fulfillment

This is meant to be a cautionary tale.

I wish I read what I’m about to write before starting our campaign.

But if you’re launching a crowdfunding campaign (and obviously assuming / hoping it’s a huge success) - you’re going to have a lot of orders to fill. In our case we had over 2000 orders to send to almost 90 countries. We had our sleeves rolled way up and were ready to burn the midnight oil to make it happen. We knew it would be a monstrous workload - but really… We had no idea.

Have you ever browsed through all the kickstarter and indiegogo campaigns that made many times their funding goal and looked at the comments from backers? It’s actually pretty amazing how many campaigns that were complete home runs have a long stretch of time where they’re having to deal with angry backers who have been waiting for their product and whose patience is running thin. We strategized on how to fulfill orders and had a bunch of solutions that we ended up scrapping last minute for various reasons. And when our inventory finally came in, we had a storage warehouse full of boxes, a packing table, 2 DYMO printers connected to our stamps.com account, 1 hired helper and a massive list orders to start sending out.

The big mistake we made is we had no freaking idea how long it takes to package and ship a SINGLE order. And the main reason for that is because we didn’t have the ability to practice until we actually had our product to pick, pack, label and ship. Now our packaging is pretty nice and meticulous and maybe it’s a bit more elaborate than the average product shipment (we have a nice box, we assemble shirts, socks and underwear in the box, wrap in a paper and sticker shut… it’s nice and it takes a bit of time to put together) but nothing could prepare us for the reality of it taking 12-15 minutes to fully pack and ship a box. We’re faster now, but our n00b fingers couldn’t do it fast for the first couple weeks. Not to mention issues with stamps.com, wifi issues in our storage locker, not having phone numbers for certain international orders (which are required). As people were now starting to expect their orders - we just couldn’t get them out fast enough. There’s no good way to deal with angry, impatient backers. They spent good money on your product and already have waited a long time. They have every right to be upset - but there comes a point when you have to balance fulfilling orders and responding to backer queries. And it’s painful and brutal as all hell!

Here’s what I will do differently in my next campaign.

For starters - I will set completely different expectations for delivery. We anticipated getting our product in late August and said we would ship through September and October…. If I could do it again, I would say shipping would be between January - February. Perhaps we would lose some Christmas gift orders, but we weren’t able to ship a lot of them in time any way. Our shipping ran well past December. If we said Jan/Feb is the shipping timeframe (and asked for 4-6 weeks for international orders) and started shipping October, we would surprise people in the good way. Under promise / over deliver is not a new concept. It’s rarely executed in crowdfunding campaigns.

Also, I would practice shipping orders until we were pro’s way before we had our product. Throw a few hundred bucks into a stamps.com account (if that’s what you’re using) and play pretend fulfilment. This is what I wish I did:

*Got mock packaging that is similar to what our packaging we were ordering was like in a quantity of at least 20 and put it on shelves (the same ones I would use to stores the real packaging) *Got mock product (in our case took a pile of shirts, socks and underwear from my dresser) *Got our packing table set up. *Got stickers, label printers, all the software set up, poly mailers… Anything needed that would be exactly like our real shipment process. *Set a timer and packaged 20 orders wrapped, boxed, labelled and ready to send out to the post office. I would then take all the packaging drive it to the post office and when I got there, turn around and drive back. (or do whatever you need to do to exactly replicate shipping)

I promise you’ll learn a lot about shipping. And you’ll be surprised at how involved this is. Once it’s all done, you can cancel and refund all the stamps.com labels to get your money back. But you need to really get a handle on what’s really involved.

Fulfillment was hard. And it was a rude awakening for me (and apparently most other campaigns).

take a mock package that is close to what your actual package will look like as well as mock product which is the same size and weight as your actual product will be

Post Campaign Surveys / Backerkit

So one of the dumbest things about Indiegogo (and I think kickstarter) is that when someone backs a campaign, they can’t customize their order if the product they are getting has options. For example, if a backer pledged to get 1 T-Shirt from us, they didn’t get to choose whether it was black or grey, a crewneck or a v-neck or pick their size. They can just select and pay for a ‘t-shirt’. At the end of the campaign you can set up a service to process all the these surveys for you so you know what everyone wants for their order. Most campaigners use backerkit. Backerkit does a good job.

It may sound stupid not to be able to customize your order when actual placing your order... It’s worse than you think. It’s beyond insanely frustrating.

Mainly because Indiegogo won’t give your backers info to backerkit until the campaign is finished so surveys can’t go out until a week after the campaign finishes. And then you have to wait for people to fill them out. Let’s just imagine all backers filled the surveys out within 30 seconds just to paint a really unrealistic best case scenario. This means you don’t know what people are actually buying off you until around a week and 30 seconds AFTER your campaign is finished. And really - they take weeks to do the surveys.

Now remember that you still need to get the product manufactured. In many cases, lead times can be 4 months to go from placing an order to production completion. So because our campaign ended in July, we didn’t know what our real order was until August. If we placed the order then, we likely wouldn’t see the good until January. And then we would probably be shipping into April. This is just one of the reasons why so many brands ship so far beyond their ‘estimated ship date’ You can’t know this stuff until you start to actually experience it.

About 2 weeks into our campaign we took matters into our own hands and sent a survey that we created ourselves (in Google forms) to get a feel for what people wanted to order. We got a snapshot of what people wanted, and did some guessing on what 8 weeks of a campaign may look like. We placed an order with our manufacture then and there based on a wild guess of what our inventory should be for the campaign and a bit beyond. In order to do this we needed to borrow $60,000 USD to make a deposit. We understand how lucky we are to have been in a position to have someone lend us that kind of money. But if it weren’t for that - we would need to wait for Indiegogo to release funds to us which happened 4 weeks later after we made our deposit. We paid our debt back right away, and focused on getting ourselves over to Shanghai to meet our manufacturers (more on this later).

Not being able to get your inventory specs from your backers in real time may be one of the most nonsensical things about crowdfunding. It makes the lives of the campaigners way more difficult and it makes so many backers have to wait senselessly long for their order. It’s often not the campaigners faults. It’s a hard system to work with - and I hope someone at Indiegogo is reading this. For you future campaigners, remember this detail. If you can’t make a huge down payment yourself, factor in that you may not know what your manufacturing will look like until more than a month after your campaign ends.

What if your manufacturer screws you over?

I live in fear of this. It happens. You need to trust your manufacturer - but real trust comes with time. I have heard many horror stories of people getting screwed over in the manufacturing process. It happens. You should fear this.

We found a few manufacturers we really like and did our initial order with one of them. We knew the prototypes we made with them were incredibly high quality. We had saved unworn samples for comparison purposes and we left nothing to chance. When production started, we boarded a plane to Shanghai. Got a hotel room for 2 weeks and moved our lives there to oversee production. This cost us a ton of money obviously, but we budgeted for it from our campaign earnings. Even if we made our bare minimum to meet our production minimum order quantities, we factored in extra money to fly to Shanghai and stay for 2 weeks. We told our manufacturer that we would be coming to inspect production well in advance. Our thinking was that they wouldn’t screw up our order if they knew we were there to see it being made in real time. I can’t know for sure if this made a difference, but maybe it did. All i know is that the quality of our mass production was on par (if not, better) than our prototypes. This insurance is priceless. I left China knowing our product was of the highest quality and on it’s way to Canada for fulfillment. We have since restocked our inventory a couple times and still make the trip to inspect every time. Until we have a trusted inspection team in China, we plan on visiting every time we do a production run. The cost is too high and the risk is too unsettling not to.

Oh, and going to shanghai is fun as hell! The life experience of travelling to be with and eat with locals is the greatest bonus I could ever imagine.

Now to answer the question ‘what if your manufacturer screws you over?’ … I have no clue. You may be screwed. Get on a plane and make sure it doesn’t happen.

Budgeting

Make a budget for the entire business for 6 months after the campaign ends. Bucket money for marketing (SEO / ads / etc), hiring help, taxes, duties, legal fees, influencers, contingency. Just start listing what 6 months of costs are for the business and allocate the money as it comes in. We did 6 months, it’s just our approach. But it’s a meaningful exercise that opens your eyes to how fast you can spread large sums of money. By doing it in advance you give yourself a really nice runway to focus after your campaign ends.

Trademarking / Incorporating

We waited to be funded before dishing out money and energy in this stuff. But I’ve been burned before and it’s not worth messing around. If your side project turns into a business because of crowdfunding - get all this boring stuff out of the way. In my sock business HItsu, we got a cease and desist for our previous brand name 1 year into running the business. After spending $10k on packaging. It was awful and nearly sunk the business. The company that sent us the cease and desist is a multi-billion dollar company and the name was hardly similar. Nothing we could do. Just not worth messing around. Take care of this shit when things get real. Immediately.

THANK YOU!

If you actually read all of this, thank you. I hope some stuff in here made a difference. If venturing into crowdfunding scares you - good. It should. It’s not easy. But it’s fun, exciting and incredibly rewarding.

Work your hardest, put your all into it, and give it a go. The best part about crowdfunding is that the worst outcome possible is people don’t back your campaign. In previous era’s people would lose their homes trying to dive into a new business like this. You don’t need to anymore. For us, Indiegogo proved product / market fit without us having to dish out large sums of money. Our ideas and hard work were enough to give us our start. If I can help you in our journey - I would be thrilled. Happy to answer any questions if any of your reach out. All the best!!

Dan Demsky Co-Founder Unbound Merino

TL;DR - well imagine how much time it took to write! Basically, I just wrote about a bunch of crowdfunding shit. Good stuff.