I want to start off with a huge tip of the hat to the 300+ backers who supported our IndieGoGo crowdfunding campaign. While the data and source breakdown below in many ways focuses on the marketing side of the crowdfunding project, it is fact that at the end of the day all the credit goes to those who backed the campaign.
This post is the first in a new series I’ll be working on focusing on crowdfunding. There will be a substantial crowdfunding guide included in the upcoming book titled EPIC Digital Nomad, a book written by myself, Shane Snyder and Audrey Callahan with an expected release later this year.
We’ll touch on the subject a few times here on the blog as well. There are a lot of things we’ve learned over the years with regards to crowdfunding and we want to share the ups and downs of raising funds this way here on the blog.
THE RV NOMADS $25,000 CROWDFUNDING CAMPAIGN
To kick things off… yes we just had a successful $25,000+ crowdfunding campaign. In fact, as of the time of this post the campaign still has 24 hours to go and sits at 109% funded. The amount raised is $27,149.
This is now the third crowdfunding campaign that I’ve advised for, helped launch or personally managed. The first campaign I consulted for exceeded its $10,000 goal with ease. It was a huge success. The second one failed and didn’t come close to its goal. The third, the RV Nomads campaign, was arguably a tremendous accomplishment. 2 out of 3 is a pretty good record and I’ve learned a lot about what works and what doesn’t.
Only about 1 out of every 4 crowdfunding campaigns are successful. According to some stat trackers around a half of those with success are campaigns with goals of less than $10,000. And most of the successful campaigns involve technology, products or inventions. Most are not content related (in our case it is a documentary project).
This means our $25,000+ successful campaign is a rare success. So how did we do it?
In short… most of the activity came via email.
This was the distinctive deciding factor on the success and failure of the first two campaigns I advised for. The successful campaign had a targeted opt-in email list while the one that failed didn’t. For the one that failed we had a large social media following and assumed this would do the trick. It didn’t. For all the buzz around the alleged power of social media, use of attentive and targeted social media campaigns proved insufficient to build momentum for a crowdfunding campaign. Sure, social media can help (it did in the RV Nomads campaign), but at the end of the day email is still where it’s at.
Let’s look at the numbers for the RV Nomads campaign.
There were 4,033 unique visits to the RV Nomads landing page. 301 converted to backers.
Here’s the breakdown of some interesting stats:
- IndieGoGo – $495 ($168 from IndieGoGo search and $327 from IndieGoGo newsletter)
- Facebook – $2,274
- YouTube – $1,244
- Google Search – $1,140
- Email – $20,441
There were some smaller numbers and I excluded those. I highlighted IndieGoGo and Email for a reason.
IndieGoGo – First, many campaign managers believe the platform itself will help generate significant backer support if/when a campaign begins to move up in particular categories. This didn’t really turn out to be the case for us. We were featured in the Film category through half of the 30 day campaign period, but this resulted in just 3% of the total amount raised. Granted, 3% is a big deal, no doubt. But it goes to show you can’t really rely on the existing Kickstarter or IndieGoGo community to elevate your project in a significant way. At least not for content projects. I would imagine this number would be higher for tech products or wearable creations, but for content/film there isn’t going to be any massive boost by the platform itself.
E-mail – As you can see, e-mail brought in the lion’s share of backers. By leaps and bounds. Facebook and YouTube brought in roughly $3,500. We did share the campaign through various Pinterest and Twitter accounts, but the total generated between the two was less than $100.
Our email list played an extraordinary role in the success of the campaign. So if you ever hear a marketer tell you email is dead and social media is where it’s at, leave that conversation immediately. Email is not dead. It’s alive and well. And it was the reason this campaign was successful.
Email represented about 75% of the backers supporting the campaign.
HOW MUCH EMAIL ARE WE TALKING HERE?
We have about 7,500 subscribers. Nearly 3,000 are members of EPIC Nomad Life and the rest signed up for updates about the RV Nomads movie. These 7,500 emails generated some $20,000 in funds for the campaign. This in a 4 week period.
The emails are broken up into 3 lists. 2,700+ are a part of the ENTV/EPIC Nomad Life segment, 3,500+ for RV Nomads updates and 1,200 or so who subscribe for ENTV updates. Each list saw about 7 newsletters during the month we ran the campaign. In total there were 20 newsletters sent to the three lists that make up the 7,500 strong database.
Averaged out this means each newsletter generated about $1,000 for the campaign.
PATIENCE & TIMING ARE KEY ELEMENTS
Several of our crew had doubts about the campaign’s ability to exceed its goal. The sense of urgency began to build at the 3 week mark, but we held our ground, were patient and knew there was a process involved. We knew that the bulk of funds come at both the beginning and end of a campaign.
At the beginning because that’s when your entire audience first gets notified. It’s the moment when all of those who would support the cause from day 1 jump on board. At the end because, well because subscribers tend to want to see success and be a part of it.
This is exactly what happened.
In the graph above the pink bars represent the total amount raised each day. Nearly $7,000 was raised on the first day. With the same amount raised on the last day we did a big push through email. As you can imagine it took a lot of patience and calm during the last week. We knew we were $7,000 shy of the goal and knew we needed to push hard to cross the finish line, but we couldn’t do it too early. If we hit the list too hard, too early, we wouldn’t be able to go back and do it again in the final hours of the campaign.
We didn’t want to beat up our subscribers and 20 newsletters in a month was already extreme. So we waited.
And it worked.
Timing is key. We needed the initial burst of activity and support, we needed to let the campaign do its thing for nearly a month, and then we needed to work quick under a sense of urgency to get across the finish line at the end.
THE TIERS & AVERAGES
One thing we noticed is our average donation appears to be higher than most. For most campaigns the average donation amount is $25. In our case the average was closer to $50, or double the general average across all crowdfunding campaigns.
Our belief is that we have an ongoing relationship with the bulk of our backers. We aren’t strangers to them and they aren’t to us. We’re all nomads. We all understand the story, the vision and the mission to share it with the world.
With our project our backers weren’t just saying “yeah, I’ll throw in a few bucks because this is a neat product.” No, our backers wanted to invest and see this project be a huge success.
This makes it incredibly important to not only have organically built email lists, but to have actual connections with these subscribers as well. Actual relationships.
PRE-PLANNING & BUDGETING
So we raised $27,000+, right? Well, yes but no. Yes we raised that amount, but no we won’t actually see that amount applied to our post-production budget. There are hard costs that have to be taken into account long before a campaign is ever launched. In the case of IndieGoGo the platform takes a 5% transaction fee and Stripe takes 3% + $0.30 per transaction. That works out to be just over 8% in transaction fees.
In addition to transaction fees we have fulfillment to manage and pay for. We have the following to fulfill in November:
- 296 RV Nomads Stickers
- 257 Signed DVDs
- 174 T-Shirts
- 83 Books
- 84 Rv Nomads Flags
- 83 Post Cards
We have several more tangible products but we already have those in inventory and only have to be concerned about shipping. Our fulfillment costs are going to be in the $4,000 range with shipping and handling all factored in. Meaning that with transaction fees and everything included we’ll be at about $7,000 down in hard costs for the campaign.
Leaving $20,000 to apply to our post-production budget.
Many crowdfunding campaign managers grossly underestimate these costs up front and get way over their heads in the process. This leads to successful campaigns that can’t fulfill promises made during the campaign. And ultimately a lot of very unhappy backers.
Do not make this mistake.
We knew we needed $10,000 for cast/production travel costs, $6,000 for editing costs and $4,000 for additional equipment, licensing and legal fees. We needed $20,000 and had to raise at least $25,000 to get it.
This is how we determined $25,000 to be our goal. So if you need $3,000 for a project, for example, you probably need to raise $5,000 to cover your transaction and fulfillment costs. You need to know what these hard costs will be and plan for them accordingly.
This is more of an introductory post on the basics of our crowdfunding campaign. In the next update we’ll get into the details of building out the campaign itself.
This is not easy. No matter what you read out there, successfully crowdfunding a project is very, very difficult. It requires a lot of time, management and attention. It requires a built in audience from day one and a well thought out plan.
You can do it, though, and we hope our guides on the subject will help.
Stay tuned for more!
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