Vance Lee started his eCommerce career on 2015 – at first just launching brands on Amazon with no hiccup. As luck would have it, in 2016, Amazon updated its TOS by banning initial reviews on newly-launched product listings. And since this was a big part of Vance’s launch strategy, he had to look for alternative solutions.
It turns out – the alternative he discovered is a gold mine. It was around this time that Vance discovered crowdfunding. He started exploring Kickstarter and figured – why not use it for eCommerce marketing? If you didn’t know, Kickstarter isn’t exactly an eCommerce website. Kickstarter is where people in the initial stages of a startup business introduce ideas to the ‘crowd’ and see if they can solicit funding for the launch. Kickstarter does not require inventory or initial capital – just an idea and a prototype.
By using Kickstarter as a launching platform, Vance was able to raise millions of dollars for launch funding and was also able to create buzz for his clients. The buzz led audiences to buy whatever Vance was selling – with pre-order sales reaching as much as $200K.
Does all of this sound too good to be true? Wait ’til you hear Vance tell the story on our featured Partner Spotlight episode with Amy below:
Vance’s Stroke of Genius Explained
If you think about it – Vance had accomplished the seemingly impossible. Whereas the normal startup incoming cash flow situation had always been at the negative side – Vance and his partners at Playground Theory have figured out a way to tip the scale through crowdfunding and pre-orders. Watch Vance explain his team’s clever ideas and learn:
- What is Kickstarter and how does it work?
- What products do well on Kickstarter?
- How to create an engaging Kickstarter page
- How to protect your ideas from lurking copycats
Vance’s Solution to the Age-Old Startup Dilemma
If you’ve had experience launching, owning, or managing a startup – then you already know that startups are, essentially, money drainers. Starting a business involves spending cash, LOTS OF IT – and most startups don’t make it through the first few years mainly because of lack of funding. So if you want to start a business, you better make sure you’ve got sufficient capital support for at least the first 5 years. Yes, business is risky. So if there are ways you could bring down risk, the least you can do is explore them.
Vance and his partners at Playground Theory are coming to us with a 2-pronged strategy that could minimize risk: 1) increase capital funding without spending a dime out-of-pocket, and 2) generate buzz for your product even before you launch. Have you ever noticed how before a new iPhone comes out, people already know all about its specs? And on the day of the launch, fans line up at the Apple store ready to part with their $2000 in exchange for their new iPhone. That’s the magic of great marketing – and Vance’s solution revolves around this idea.
Crowdfunding platforms such as Kickstarter and Indiegogo are already used as testing grounds by aspiring entrepreneurs. Creative (sometimes bordering crazy) product ideas are welcomed into their platform to test how well they would be received by the ‘crowd’. Vance and his team studied how some prototypes on Kickstarter become actual products on Amazon and thought – why not?
So that’s what they did – testing the theory first on their new product idea: a new cold brew coffee maker invention called The Arctic. Vance had intended to launch The Arctic first on Amazon, but shifted gears and decided to do a pre-launch on Kickstarter and Indiegogo first. The Arctic’s crowdfunding page was received positively and Vance was able to solicit a generous amount of funds from people who believed in their product. Not only that – but the more substantial result that happened was that it got people truly interested to buy the product for their own use. Vance ended up earning more than $650K on pre-orders from customers influenced by his product’s Kickstarter page. Vance was already making money on The Arctic even before he started selling it on Amazon.
To date, Vance and his team have helped their clients earn millions of dollars just on their launch campaigns alone – proving that not only is their Kickstarter launch strategy effective – it has the potential to be highly lucrative, with the right moves.
We’re sure you have questions. Here are some of Vance’s answers to the FAQs:
- Don’t you need to have a crazy and extremely unique product idea to get noticed on Kickstarter? – Not necessarily crazy, but your product does need to stand out – just like how to get noticed on Amazon. This is where a well-researched marketing strategy comes into play.
- What are some proven ways that will help a product do well on Kickstarter? – Apart from a compelling unique selling proposition (USP), people gravitate toward a great back story. Having an audience involved from the beginning stages of brand building creates a connection that can grow into brand loyalty over time.
- How do we deal with product copycats? – There’s no denying that people go to Kickstarter for research on product ideas and that using the platform may put you at risk for knockoffs – just as any other platform. There’s no surefire way to stop knockoffs from happening – we’ve seen it happen to bigger brands all the time. But again, if you’re able to build a strong brand presence that connects with your audience and encourages loyalty – then your audience will naturally gravitate towards your brand.
Don’t you just love the vast expanse of marketing and how ideas are welcomed, no matter how far they have gone out of the box? Vance’s success is a testament to the unlimited number of solutions available if we just broadened our minds and tapped into our creativity.
Moral of the story: explore your crazy ideas – you never know which one might work.
Transcript:
Amy Wees: We are live and hanging out here for another partner spotlight and I’m here with my friend Vance Lee. And Vance has a pretty cool story. First of all, he recently sent me some really cool coffee cups. And at first I thought these things were super weird. And then I became kind of obsessed with them. I’m imagining that that happens with a lot of these people that you send these coffee cups to. But anyway, we’ll talk a little bit about coffee, and how you invented this really interesting coffee thing. But before that, Vance promised to tell us how he has gotten over $200,000 in pre-orders before he even made an order with his supplier. So I want to know all the secrets, we’re going to pull all of Vance’s secrets out today.
Before we get into that, though, Vance, why don’t you tell everybody a little bit about you and who you are?
Vance Lee: Sure, yeah. Well, thank you for having me. This is really exciting. Excited to jam with you again. So well, I’m Vance. And I started ecommerce back in 2015. And this is when this was when FBA… was I mean, obviously, you had a lot more experience than that. But back then FBA was like core prime, where everybody was super excited to get into FBA. And that’s when I jumped in around that time. And I’d first started with Amazon FBA. My first product was product research. Practice. Okay, let’s sell this. And that first product did really, really well.
And in 2016, I said, Hey, I’m going to, I want to launch 12 to 15 products that year with my business partner, and we just went off into it. And at the end, near the middle to end of this year was, for those of you that have been around since then. That’s when Amazon changed their terms of service from being able to allow honest, unbiased reviews, and they cut that off. So that was my first shock from having a specific launch strategy. And going into Amazon and saying, Well, Amazon is not gonna allow this anymore. So that’s kind of what allowed me to kind of explore outside of Amazon. So that led me to Shopify. And eventually, that led me to doing pre-orders on crowdfunding and Kickstarter, which we’re going to talk about today.
I launched my very, very first Kickstarter campaign near the end of 2016, with a product that I intended to launch originally on Amazon. So it was already very, very much in the development process, we had the prototypes, and it was almost ready for production. And it was going to be a big, big investment. And we had this very clear strategy to how we would want to launch this on Amazon. But because that didn’t work, we got scared, and we had no idea what to do to launch this product.
So that brought me to crowdfunding. And I launched this product on crowdfunding, and it was a cold brew coffeemaker. We call this the Arctic. And it was, at the time were a little bit of ahead for coffee products, and specifically cold brew. We launched this product and ended up doing about $650,000 on Kickstarter, and another $300k plus on Indiegogo, which is another crowdfunding platform that we’ll talk a little bit about later on. And that was my first entry point. So seeing that it’s possible to do pre-orders. And it’s possible to launch product off Amazon that could eventually scale to Amazon, or scale to Shopify or wherever else on ecommerce, it became an alternative shot launch strategy that allowed me to get cash flow. And since then, I’ve launched a handful of products on Amazon. And I’ve supported a lot of people launching products on Kickstarter as well.
So we’ve made about $7 million of successful launches from our own campaigns and the people that we’ve worked with, and two of my own campaigns have raised over $1.2 milion and we’ve had a lot of a lot of success with those products afterwards. So that’s kind of my from ecommerce to to crowdfunding.
Amy: I love it. Okay, I have a ton of questions for you that I know that everybody wants to know, because I’ve been asked all these questions before, I have clients who come to me all the time, they’re like, I want to do Kickstarter. And I’m like, No.
So my first question for you is, isn’t Kickstarter hard? Like, you need a marketing plan, you need to have some of your own leads, you need to be pretty good at marketing. And oh, by the way, what about the product? Doesn’t the product have to be something special? Like if people can just go buy it on Amazon or a similar product on Amazon? Why would they give to a crowdfunding campaign? So those are my questions like, Why kickstarter and isn’t it hard and what products do you need for that?
Vance: Great question. I want to mention to just three main FAQs that come up generally right? Before anybody even ask these questions you’re asking, which are awesome questions, by the way.
So the first thing is, what is Kickstarter? And is it a platform that replaces Amazon or Shopify? The answer is that Kickstarter is not a platform, like walmart.com. It’s not another platform that you’re gonna be selling on long-term. It doesn’t replace Amazon. The idea here is Kickstarter is a launch platform. The idea here is we’re using Kickstarter as kind of like addition to our strategy to launch. And then after we get the success from that, and the results and the cash flow and the proof, then we move into Amazon.
But before we do that, and we’ll talk about it in a few minutes, but that’s the first question that I usually get, what is Kickstarter? How does it really work? Is it just another platform that I had to figure out and put a lot of work into, to? If Amazon’s intimidating enough, then nobody wants to go Kickstarter.
And then the next question, which I kind of answered already, is can you launch on Amazon, or Shopify or wherever else you want to launch on afterwards? And the answer is yes. This is just a peripheral launch platform that you can use to move into other platforms after or if you want to do retail, or whatever it is that you want to do. The idea here is you can go from Kickstarter to wherever else you want to go.
And the last question, actually, is do you need to have a crazy innovative idea and launch it nationwide? And the high-level answer is that you don’t need anything extremely crazy innovative, it needs to stand out. And we’ll talk about what that’s going to look like in a in a second. But the idea here is it needs to be different enough for people to be interested in wanting to support that and wait a little bit rather than buying it directly on Amazon. And it works for all sorts of categories. And we’ll go into some examples of what this might look like for certain categories we’ve worked with, and the super interesting ones that have done well, which you wouldn’t expect.
Amy: Vance? Some of your internet is breaking up quite a bit. It’s like it’s connected. And then it’s not connected. So it’s, it’s some some of your stuff is breaking up. But usually it catches up a little bit. Now it seems to be back again. So I caught nearly all of that, except for the last part.
So the the idea is lots of different products work on Kickstarter, as you’re explaining not just like brand new products, because people there’s the way I’m understanding is there’s like fans of Kickstarter. So they like would rather kind of support and follow a brand and follow a story. And I know from teaching marketing and branding, that people love a background story, they like to be involved. So that would be a reason why they might buy from Kickstarter and support a brand, even if they can find a similar product on Amazon. Right? So that’s a really good argument. And it makes sense. And I love that you’re gonna give us some ideas.
But if I do have a more unique product, I know one of the biggest concerns for Amazon sellers. In fact, this technique is caught all over the place. One of the biggest concerns is copycats. What about copycats? So I put my unique product on Kickstarter. And now all of a sudden, I’ve got all these knock offs, because people use Kickstarter for product research all the time. So what do you say about that?
Vance: Yeah, that’s a really good question. We get this question a lot as well. And I think the answer to this is that the biggest company in the world, Apple produces these headphones, I don’t have those headphones right now. But the corded headphones, or even the ones that go into your ear, and they have dozens of Chinese counterfeits for those types of products. So the reason I say this is that, if you have a good product, and you have a good product idea, and it’s something that people like whether you’re launching on Kickstarter, or on Amazon or Shopify – if it becomes successful, and people find it, and they really want to copy it, that’s not really … even the biggest company in the world can’t stop people from copying their products.
So in this situation, our goal here is to use Kickstarter as a way to start building a real brand and building a community and building an audience that support your product. So that when it actually comes, when there’s a situation like with us, we actually had some Chinese manufacturers copy us and start trying to sell on AliExpress. And it was actually our customers that brought this to our attention said hey, we came across some somebody trying to steal your product idea. And you know that that product didn’t end up doing well for this person that tried to copy us. The idea here is when you start building an audience in the community, these people kind of become the moat and people really care about the brand when they’re supporting products. So at the end of the day, they were really excited to support our product. And so they really cared about the experience when it comes to interacting with our brands. So that’s something that really is your first offense, having people that really care about, that’s gonna be a massive, massive thing that allows us (an advantage) for over some random copy product.
Amy: I love it. Okay, so we have to always deal with copycats, honestly, like whether you’re, you know, I will never forget, I launched my patented product on Amazon. And like, within a month, I had people selling it on eBay drop shipping it in Canada, you know, all these issues all over the place. And it was just not a fun situation. So I’m just like, not, I’m very, I was very nervous about that. But at the end of the day, I was the holder of the patent, I was the holder of the trademark. So I use my normal legal methods to at least shut down the people that could have caused harm. And then the rest of them just kind of like left be like the ones that were just being copycats, because they were popping up all over. They were selling my product. So it was like, Okay, you got to pick your battles sometimes. Right. So yeah, that makes sense. I like it. Okay. Tell me about some of the most, you know, popular products that you could do on Kickstarter, were really like, how do you even How do you even decide whether or not your product idea is a good thing to consider for Kickstarter?
Vance: So this is a great question, I show an example. So people watching might not necessarily know what Kickstarter looks like, or what the how the platform works. So I want to use this as an opportunity to answer your question and also show an example of a campaign that we had supported to launch and show you kind of what the Kickstarter platform looks like. So I’m gonna share my screen if that’s okay.
Amy: Yeah, sounds good. Third, your internet is like, in and out and in and out. So I’m really, really hoping that this works. I’m so sorry. You’re watching us right now. If you can comment on whether or not you’re you can hear everything. Okay. That’d be really great.
Vance: Let me see if this works. If I could pop something about that. Okay, perfect. So this perfect, so we’ll just we’ll just do that for now. Okay, so this is one of my favorite examples of kind of a category that you don’t really expect to do well. So like I mentioned earlier, there’s a lot of different categories of products that can can do well on Kickstarter. And we’ll talk about kind of how to one of the most important things, which me you hinted at was, how can we get a product to stand out? And what’s what, how can we make that work. So I’m going to walk through a framework later on. And that’s, that’s going to show us how to actually position or decide if a product is going to be something that’s going to be appealing to, to to, to run on Kickstarter. So this is a really good example of an interesting campaign that we we helped launch and this one was essentially she was a solo female entrepreneur who was a chef and she’d never launched anything on E commerce before and she had this idea for hot sauce and she came to us and we had a conversation and we said why not try launching this on Kickstarter and and see if you can get some support to get some funding and get some cash before you start rolling this out and and kind of going about like a traditional way of rolling out this product to retail and all those other channels. So she ended up launching this product on Kickstarter did about $120,000 here on a funders the funds raised over a campaign. And that led to about 1600 backers. So 1600 people supported her Kickstarter campaign. So what you’re looking at here is the Kickstarter campaign page. So this is this would be equivalent to your Amazon product listing page where you tell people about your product. And this is where they look at it, they decide, hey, I’m interested, and I want to support you. And they, they jump in, and they support you. So since then, this is this is the crazy part of the story. So since then, she had this successful campaign, and she took this success. And not only was she able to build a massive brand from it, she was able to continue building your community. So what she did was, she decided to expand on this by creating a lot of different types of content. She has about 100,000 followers on on Instagram right now, which is really, really massive for hot sauce. This isn’t like a clothing brand. This isn’t like a, you know, a funny meme account. This is literally a hot sauce brand. And these are not, you know, these are not paid followers, she actually has a lot of engagement like this is 2000 likes on her boiling dumplings in this like hot pot. So really, really interesting to be able to kind of do that. She least about going on at the moment. And me can you see this? Hello.
Amy: Yeah, we You said she is only selling products on Amazon at the moment you mentioned.
Vance: Oh, she from that’s what ended up happening was she actually took this. And because she had success with with this campaign, she actually took this not everybody has to go through this path. But she took the successful results of this campaign. And she actually got some funding from it from a strategic investor. And from that she was able to take this and launch this on Amazon. She launched this on her own website as well, and
followers are there’s every single every single month on our on our website. And we’ll wonder if we’ll see if this loads. Oh, yeah, so she has 100,000 monthly visits on a regular basis. This is a hot sauce, right? This is not like a, this is not a clothing brand. It’s nothing that you think is super. And in fact, hot sauces. I mean, if you buy this at a Chinese grocery store at the bottom shelf at the grocery store, it’s like $2. And you can see that she’s selling this for 20. Close to $20 $18 for for a can of hot sauce. And since then the coolest thing is this. She actually was able to launch this on not only on e Commerce on her website and Amazon, but she brought this to target. Costco and the hardest one of all she got into
Amy: Whole Foods Wow. Yeah. Okay, that’s
Vance: It’s something that there’s something to show for that. Because if you can, when you’re trying to get backers, when you can say like, Hey, I was backed by, you know, I raised over $200,000 on Kickstarter, I raised half a million dollars on Kickstarter. I have a friend who just invented a portable the day like, and he he was able to raise over $200,000 on Kickstarter in pre orders. And you know, that is something to show for it. Like then when you go for investors, you can show them like, hey, we already proved this. Like before we even delivered the orders. People gave us money, like they want this product. And so it’s just really exciting. I used GoFundMe when I was launching my product and I was able to get 61 preorders. And for me that was perfect. Like that was exactly what I needed to like really boost my my Amazon sales from the very beginning get that feedback where I had their email address and I could do all of that. I wish I would have done it on Kickstarter, because I think the I would have had more orders because people kept asking, they’re like, I don’t understand why you went with GoFundMe. I don’t get the GoFundMe thing like they didn’t they didn’t really understand even though GoFundMe has that platform for raising pre orders. They didn’t understand it. So it was like me doing a lot of sellings had that on Kickstarter and did the same marketing efforts that I did with GoFundMe, I probably would have doubled at least doubled my pre orders.
I think so yeah. And because Kickstarter has its own audience as well. product
Amy: Okay, so um, yeah, I think those were really, really great examples. I think your back. So for now, we could hide it and see if we can if we can keep you here for a moment to answer a few questions. So I get it, you don’t have to have a special product, you really can grow a following simply by using this, this method. And in you, you, if you are worried about copycats, you’re gonna have copycats, no matter where you go, when you have something successful, and people are backing you. But the difference is people aren’t backing the copycats so. So you’re gonna have a better opportunity than the copycats because you’re going to be better at marketing, and you’re actually going to develop a following using this process. So I think that’s, that’s really, really great. And something to consider. So what are those key questions that people should be asking to decide whether or not they should try a pre launch? Should they? Should they ever just try a pre launch? I guess, is a really easy, quick question. Like, should I ever just throw it up on Kickstarter and see what happens? Or do I really need to prepare and be answering some questions before doing that?
Vance: Sure. And I think it’s an like with any other business venture and any other project that you take on, it’s pretty important to ask some good questions before you jump into it. And I think the the biggest idea is, is when when you’re looking at consider a pre launch are going to procedure business. Dive into that right after I answer this question, which is what are the benefits of Kickstarter? And what could you potentially gain from Kickstarter and see if that’s something that makes sense for people watching this to consider if that’s for them? But at the same time, I think the biggest most important question in asking this question and asking this is that, when it comes to the product itself, I’m actually going to dive into the framework that we use for how we can, how we can assess and how we can create a product that’s going to stand out. But the idea here is we want to understand specifically related to the product, is this going to be something that people have any desire to want to support? Or wait a little bit before they can purchase something that’s equivalent on Amazon? So the idea here is can you make your product interesting enough and standout enough, or something that’s relatable enough when you create the product and the campaign to connect with the audience so that they’re going to be interested in supporting us specifically? And also waiting? Before? To see if it’s something that they would they would actually support? So if share? Want to kind of back screen sharing?Vance: Let’s talk about why this is an interesting model, and why a lot of sellers have been considering this two launches, but at the same time, launching the product in in a way that allows them to be successful. So why is this favorable for seller so this is the traditional model, a traditional launch model, whether it’s on Amazon, or whether it’s on on Shopify, we know this model very well, first, we placed the manufacturing order, then we pay for the order. And then once we have our inventory available, we begin to start selling specifically with something like Amazon, we invest in our launch strategy, and we start selling, you know, we start trying to get get momentum so we can start ranking and then start being successful within the platform. And the idea here is that we hope that at some point we can be successful with with with his products. So that’s what the traditional launch model looks like. And so why is Kickstarter appealing? And why is this been so interesting to a lot of sellers? Well, to understand that, it’s important to understand how Kickstarter works. So with Kickstarter, it’s going to be a little bit different with Kickstarter. The idea here is that we’re going to launch a limited time campaign of up to 60 days. So once we launch this campaign, it’s important to note that we can actually launch this campaign without actually having the inventory. So we’re going to explain that in a second. But the idea here is we launch a limited time campaign. Customers that are on on Kickstarter or customers that you’re building in your community will place pre orders and once they place pre orders and your campaign is successful. You’re gonna get paid from Kickstarter, within 15 days of the campaign closing. So let’s say you’re running the campaign for 60 days, at the end of that 15 days afterwards, you’re gonna get paid by Kickstarter the cash in full that you’ve raised. So here’s an example of a VAT trial that raised about 330,000. On Kickstarter, they had some interesting materials, and a really cool story. But so that’s, that’s what they ended up doing there. But the idea is, once you get the, once you get the funds, then you can place your order with your manufacturer. And from there, once you receive the inventory, you can fulfill that to your customers. And, and, and kind of, and just kind of close off the Kickstarter campaign. And then from there, like we mentioned earlier, you can then take this and launch to your preferred channel of choice, you can either launch on Amazon, Shopify, or wholesale, or wherever else kind of makes sense for you. So canAmy: I ask, Can I ask about on Kickstarter? If you don’t raise your goal? Don’t you forfeit all of the money?
Vance: Yeah, so with Kickstarter, specifically, if you don’t hit your campaign goal, then you won’t get any of the funds. So let’s say you your goal is 10,000. And you don’t hit 10,000. You You won’t get released to you the other, the other, the other platform called Indiegogo, they allow for let’s say you raise $1,000, not $10,000, they’ll still release the funds to you and hopes that you can execute the, you know, the production so that you can do what happens with
Amy: So let’s say you raised 1000, but your goal was 10,000 on Kickstarter, and you didn’t get you know everything. Well, what happens with that? All that $8,000 You raised? Does it go back to the backers? Oh, yeah,
Vance: It just gets returned to everyone. So they Well, what Kickstarter is doing is they have this model called All or nothing funding. So if you don’t hit your goal, they assume that because you don’t hit your goal, you’re not able to fulfill to your, you know, fulfill the obligation of manufacturing and filling to your, your your backers. So that’s why they just returned it to everybody with Indiegogo. Yeah, it was a little
Amy: So when you’re starting, you should probably start with a little bit of a lower goal and then over raise, if you can,
Vance: exactly, yeah, that’s your your way. That’s that’s generally the strategy that we have when it comes to making sure that we’re able to at least hit the funds, and hit the funding goal, and then to be able to exceed the funding goal once we hit that.
Amy: Cool. Yeah, so please continue. I was just curious about that. Yeah,
Vance: No, that’s a great question. So what do we need to launch and this is, this is where it gets really interesting. And we touched on this briefly earlier, all you need to launch a Kickstarter campaign is a prototype, a working prototype, so in this case, it was it was tell, or if you’re doing something, you know, whatever it is, you just need a prototype that shows the product exists, that it’s that it’s working. And then the second thing that you need is the the campaign page. So this is like we mentioned, equivalent to the product, Amazon product listing page. And so the interesting thing about this is that we we really see this as a strategy as long as your product is a fit. And this is what you want. In terms of the benefits for running a Kickstarter campaign, we really see this as almost like a no risk strategy, because the idea here is that you would have to create the photos, you’d have to create the copy. A lot of people would argue that you don’t have to create video nowadays for Amazon. But I would think that, you know, if you want to have a competitive Amazon listing, or you want to do video ads, and you want to do something really cool for your brand, that video is going to be something that’s required. So the idea here is you’re going to be creating assets that it’s going to be usable for when you choose to launch on Amazon, when you choose to launch your brand later on, and run ads or whatever it might be. So you’re not doing anything extra that you wouldn’t do otherwise. But the only thing that you don’t need is you don’t need inventory that you would need to launch on Amazon or on your website. So this is an extremely appealing way to launch in order to in order to get validation for your product idea. But also some of these other things we’re gonna mention. So you don’t need inventory in stock to do this. And all you need is that that campaign page that we showed earlier, we looked at the hot sauce example, that page is all you need to launch and a working prototype to get approved. So because of that, this has led to a lot of really interesting benefits that we can talk about really briefly. But there’s, there’s probably a list of 15 or 20 of these. But the top five, I’ve kind of isolated down to what most people why most people find this, this model and this pre order model really appealing for for their lunches. So I’m gonna go into these one by one and just kind of give a quick overview. So this is this is the project that we first launched I mentioned to you earlier, Amy, and I might have sent this to you another time where you would have seen it. But the the Arctic was our first our first campaign and we ended up doing about 650 on Kickstarter, another 200 ish on on IndieGoGo and about 90k in back end upsells so close to a million dollars on that campaign launch. So why is this a better model and why is this really appealing? Well, the traditional Amazon launch model requires a lot of inventory, initial inventory investment upfront and for a lot of people this might be challenging, even for the people that are even for sellers that are more advanced and have existing this As it says, that are pretty big, this can, this can suck up a lot of cash. So the challenge is that this may or may not necessarily be successful. And you know, if it isn’t, then you’re you’ve kind of taken on a lot of risk. With the launch model that we do for Kickstarter. The idea here is that we all we need is a prototype. And because of this, we’re able to invest a little bit, and that amount would have gone into getting invested into the assets for launch on Amazon anyways, we eliminate the risks when we get the pre orders first. And this allows us to do this without actually spending $1 on inventory and events. So this is really appealing for a lot of people, whether you’re a new seller, and you’re you’re just trying to hedge risk, or you’re an experienced seller. And the idea here is to is to also hedge risk, but at the same time, we’ll talk about what that looks like when you actually are able to optimize cash flow, because that’s gonna allow you to do a lot more in your business. And I’m sure you know,
Amy: This is back to your previous slide that you had where you talked about what you need, right? And you said, you just need a prototype, and a campaign page. But you do need a marketing plan, right? Like, I mean, Kickstarter is not you need to be able you need a plan to reach out to people you need a plan for, like, how are you going to get traffic to your Kickstarter page? So that’s, that’s a consideration as well, isn’t it?
Vance: For sure, yeah. And in terms of the strategy, and what you do in terms of outreach, those types of things are important. But in terms of actual assets and things that you need to invest funds in, it’s going to be the prototype and to to have that as your your approval process for Kickstarter. And to actually launch the campaign itself, you will need the campaign page essentially, that’s what we mean by that.
Amy: Got it. And so you shouldn’t plan for any marketing dollars to
Vance: Yeah, we’ll definitely need to plan for marketing dollars. When we go through this process. We we like to do a lot of the free methods. And I will talk a little bit about this when we talk about the process. But the the idea here is that we want to focus on things that are kind of a little bit more grassroots, but also allow us to build stronger relationships with with our, you know, our potential future community and in the list that we’re building. So,
Amy: got it. Okay, so sorry. Sorry to interrupt. Please continue. Yeah,
Vance: great question. So you’re way ahead. So. So this, this is one of the benefits is to be able to flip the E commerce model upside down and eliminate kind of the initial inventory risk that’s necessary to to do traditional launches. And then associated with this is is cashflow. So when it comes to launches, you know, we when we I still sell on Amazon, so this is nothing against Amazon at all, like I’m still an Amazon seller. But when it comes to Amazon launches, you know, often Well, the way that we look at launches is that the the launch itself is more of a sunk marketing cost. And that’s, that’s okay. And the idea here is, but the challenge here is that it often sets us back in terms of cash flow, and we kind of, we have this kind of thing that we need to do to keep catching up on on cash, the next order cash next order, it becomes a cycle that’s really challenging. And the bigger that you are often this is a bigger challenge. So this is for newer sellers, that are thinking, hey, you know, once I reach a certain volume of sales are a certain income level that this goes away, you know, this, this doesn’t necessarily go away, this is something that actually becomes a bigger challenge as you as you deal with higher and higher levels of wanting to grow. So with, with the Kickstarter launch model, this is really important because the idea of launching and be able to get cash flow, get to get the cash in advance and get paid right away by Kickstarter allows you to have that cash flow up front. And if you raise in most situations, a lot of people raise more than they need. And what they do is they’re able to take this and maybe if they want to invest in more inventory so that they have more inventory available for their Amazon launch. Or if they have other initiatives that they want to take this, take this cash and invest in, they can do that as well. So the idea here is that you’re able to, you’re able to become more cashflow positive immediately. And this is going to be able to help you invest in whatever makes sense for your business at that stage in time. And often, it’s just a matter of investing in extra inventory. So you get ahead in terms of making sure that you have inventory available. And then once you go through your first cycle, then you have a little bit more cash to work with. So you’re a little bit ahead when it comes to cash flow. And so those are the two main reasons financially why people will find this model extremely appealing. And the second one. The third one is that this is something that we don’t really think about much on Amazon. And it kind of leads to the question of why is it so difficult to build build brands on Amazon. And the main reason is that we don’t necessarily have access to these customers because they’re Amazon’s customers, so we have to go all these roundabout ways to to get some insert cards and get people opting in to our mailing list two different ways with the products and or you know, do some retargeting stuff on on our website, lots of different strategies that are that are allowing us to get the goal of being able to connect with our with our, with our eventual customer. So and you know, it’s really difficult. We noticed this when we had our own challenges with launching products. When I was in the second year of my business, launching multiple products in the kitchen category didn’t make it any easier because I didn’t really people didn’t know that I was launching my second product. I didn’t have access to these people. So the fact that I launched product and it was, you know, it was it was doing okay didn’t mean that other product launches would become any easier. So in this in this goal with with the Kickstarter launch, what we’re trying to accomplish is allowing us to be able to build an audience that allows launching future products much more easy or launching accessories much more easily whatever it is, that’s gonna allow us to do this over time. And the idea here is that once we build that audience, we can, anytime we want to launch something new, we our goal is to launch it to them again, and to be able to say, hey, we’re launching a new product are you interested. And that’s exactly what we did with our second product, which was the glasses that you mentioned. And with, with this project, we had about didn’t seem like a very large number, we had about 5% of our original customers from the first campaign return. But what that led to was about $40,000 in sales. So initially from the first, from that launch, we saw about $40,000 worth of sales, specifically, from customers that were from our first our first Kickstarter launch. So that was really valuable. And then this is really brief, I won’t go into too much detail. But if you have a successful Kickstarter campaign, or a successful launch, often people want to share about this, if it’s, if it’s interesting to that niche. So we have a lot of coffee publications, and a lot of a lot of different types of coffee blogs want to feature us. And that led to a lot of buzz off of Kickstarter and off platform. So that’s something that’s that that’s super, super helpful when you’re looking to build a brand that’s going to be interesting to, you know, to a specific niche or specific audience that you want to reach target or market to in the future. And finally, when you’re successful on Amazon, often it doesn’t necessarily lead to success off Amazon. So the other benefit for for launching on Kickstarter is it allows you to start setting yourself up for potentially diversifying, or scaling on other platforms. So with us, when we became successful from these campaigns, specifically with the coffee products, we were able to start selling on our own e commerce Store, we had third party websites reach out to us and wanted to carry our web or product on their own websites, we were able to start actually, we had a whole bunch of people reach out as distributors that wanted to connect with us and, and carry our product. So right now we have, we have distributors in about 17 different countries, from Korea to, you know, to Dubai to to Japan, where these people are actually buying products from us in bulk wholesale. And they sell it to distributors or coffee shops within their own countries. So all these are things that actually came up as a part of, of being able to launch on Kickstarter. So those are the reasons why a lot of people have been an interesting Kickstarter. And that’s one of the biggest considerations when it comes to potential of why you might be interested in using this model.
Amy: I love it. I think it’s great. I think it’s a in if you take your time and actually consider all of these things, and you prep for it, you’re able to really make a sound decision about whether or not Kickstarter and launching this way is the right way for you. So I love this thought and, you know, speaking of the things that I love, there are the events see coffee cups that You sent Me, I absolutely love them. My favorite is the one that’s shaped. Like it’s like the medium size. It’s shaped like a wineglass on top of the larger room. I haven’t tried the smallest room one yet, but it is absolutely my favorite. And I thought it was so silly to drink coffee out of a glass instead of a mug. But oh my gosh, does it taste different? It really tastes different as a whole thing. So I thought it was so cool. I had to post about it on social media. So well done with those coffee cups. Cool.
Vance: I’m glad you like it. Yeah, that’s awesome.
Amy: Yeah, you guys did such a good job of building that Kickstarter page, too. I mean, you know. So I mean, definitely a reason for people to reach out to you for help on these things. Because, you know, you’re really good at doing those organic things that that mattered, not just pouring a bunch of money into ads. But really thinking about the foundation. Your foundation is your Kickstarter page, your offer, the way you communicate what you’re doing to your audience. If you do all that, write that stuff that doesn’t cost you much except for some thought and you know, some good copy and some good photos. You did such a good job with that on all of your pages. It costs you a lot less less than an extra marketing dollars, because you’re not having to sell more except for to bring people to that page to check it out.
Vance: Sure. Yeah. Yeah. Thank you. I appreciate that. Appreciate that.
Amy: Yeah. So you mentioned what are the best organic ways for people to grow their audience once they do something like this?
Vance: Well, so we like to see the process the entire launch process as not necessarily just the, the launch itself. So our goal isn’t just to have a launch. But as we’re going through this process, the whole point here is to start building that audience and building that community that really care about what we’re working on and care about supporting us. And that’s what actually creates that desire to support us over buying any other products. So a lot of the actual launch process itself, is, is geared towards building that relationship and building relationships with people that care about our niche. And then eventually, the idea is we get them to care about our product launch, and then our brand. So that’s gonna be really important. So there’s lots of different ways to do that. But I think what you’re asking about is how to take advantage of this, you know, this campaign to be able to, to kind of take advantage of that to to build further reach. Is that the idea?
Amy: Yeah, so that you’re not spending so much like in the beginning, you know, I talked about wow, like, what I know of Kickstarter is that we need a lot of marketing dollars, we need Oh, gotcha. So you said, you know, there’s a lot of organic ways that you can grow your marketing without having to buy a bunch of, you know, Instagram ads and video ads and stuff like that. Yeah. What are some of the best organic ways that you’ve seen to grow?
Vance: Yeah, so these are the ways that we love the most, a lot of people aren’t talking about these, because they like to use the paid ways because they’re actually just easier or they’re, they’re just quicker, right? So ads to a landing page opt in, that that works. So that’s something that definitely is something that I don’t want to rag on because we do do this, but we do this later on. One of the early things we like to do is we actually like to start building and doing organic outreach to the main question we like to ask is, where does our Where do our customers hang out? Or where do i Our ideal customers hanging out. So in a lot of situations, we might be able to find them, for example, in, in Facebook groups, or in Reddit communities, or specific forums that are nice to, you know, let’s say it’s like a running or tennis club or something like that, it could be something like that. And we might even look at things that are in Live community. So like regular meetups, where, you know, there might be a meetup that has like 3000 3000 members, and we get in touch with like, the person that is the leader of that group to be able to reach out to their audience and send out a survey to them. So lots of different ways. But the idea that the question to ask is, where does my Where does my ideal future customer hang out? And what what is the way that I can connect with them directly. So we like to use Facebook groups a lot, because within Facebook, there’s lots of different types of groups that have really specific niche interests. So with our lunch, we reached out to a lot of Facebook groups that had, you know, audiences of home barista, so people that made they were nerdy, and they made coffee at home, or people that were actually nerdy about coffee that were baristas. And we we started engaging within these groups to be able to what we like to call a community development, not only in terms of building lists, but the idea is how can we get some feedback from these people, as we’re developing this process? So this leads to one of the questions you asked earlier, you know, how do we know this product is a good idea? Well, we can do this with actually not a lot of money at all. And it’s actually free to be able to start reaching out to people in the audience in the target audience that we’re going to be, we’re going to want in our, in our future customer base, to ask for feedback about the product. And this gives us two benefits. The first one is it gives us real feedback from real customers, rather than necessarily, for example, using something like to pick foo, like, do you like this? Or do you like this? Or do you like this design? Or do you like this design? I’d rather much as I’d much rather ask customers that are going to be within our niche that would care about our product in the future, to be able to offer that type of feedback. So so we like to do that. And that in doing this, not only are we building relationships that eventually say, Well, you know, we’re going to do a beta round, or we’re going to do you know, we’re going to do we’re going to send out samples, would you be interested? So there’s a lot of stuff that you this can lead to, but the idea is, where are your customers hanging out? And how what is the what is the smallest thing that you can do to engage them that makes them feel that makes them feel interested in participating? So we’re not trying to sell them, we’re just trying to get them to be interested in the concept. And from there, that’s how we build that relationship over time to to have them eventually support our product launch, and then our brand as we launch more products in the future.
Amy: All right, awesome. Well, I think that we’ve pretty much covered everything today. The last thing that we have to ask is dance, how do people find you and learn more about the services that you offer to help people if they want to try a launch on Kickstarter?
Vance: Sure, yeah. So you can definitely find me on our website, live my paragon.com I think it’s up there right now. And if you’re interested in exploring Kickstarter, or the pre launch model as a way to launch an upcoming product, there’s some free web resources on our website, all you need to do is just go there, enter your email, you’re gonna you’re gonna get sent some some checklists and a video training series. And we also offer a masterclass that we’re, you know, that we’ve been, we’ve been getting a lot of positive response for. And that’s the idea here is we’re going to take you from just idea concept all the way to launching and getting funding and what it takes to prepare you so that you’re able to eventually scale to the next platform of your choice. So for most people, that’s gonna be Amazon, or Amazon and Shopify. So the idea here is it’s going to take you from product concept all the way to launch getting funded and preparing you For where you’re going to be scaling on ECOM eventually.
Amy: Amazing. Well, Lance, thank you so much for being here today. Thank you everybody for watching and tuning in and putting up with our internet glitches today that we had. I’m so glad that it came through at the end it was nice and solid for the rest of answers presentation. So that just thank you, internet gods. Thank you fans for being here today. And thanks, everybody for watching. We’ll see you guys next time and check out his website live my playground.com It’s pretty cool. He’s got some great free resources for you there and some paid resources too. So check them out. And thanks fans for teaching us all about launching with pre orders. It’s awesome.
Vance: Thanks, Amy. All right. Bye, everybody.
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