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Why Major Brands Are Heading to Crowdfunding Sites for Product Development Insights — MashTalk

Why Major Brands Are Heading to Crowdfunding Sites for Product Development Insights — MashTalk

(upbeat music) – Hello and welcome to MashTalk, the show where we catch up with the most interesting people in tech. I’m Mashable tech editor Pete Pachal. So it’s been ten years
since Indiegogo launched, changed crowdfunding forever. I am super excited to introduce our guest. Welcome to the show David
Mandelbrot, CEO of Indiegogo. How you doin’? – I’m doing great, Pete. Thanks a lot for having me. – Cool, can I call you Dave? – Yeah, Dave is great. – Is Dave alright? – Yeah, Dave is super. – Nice, so you’re the man in charge of the whole operation there. How did you get there? Tell me a little bit about yourself. Where did you start getting
involved in crowdfunding and then how did that sort of transition into Indiegogo and then the CEO gig. – Yeah it’s actually a nice story. So earlier in my career I spent about seven years at Yahoo, starting in the late 1990s, so I’ve been working in online
tech for over 20 years now, but the way I got
involved in Indiegogo was, I was at a start-up
before Indiegogo call Tynt and we had a board member
who was also on the board of Indiegogo and he was
based here in New York, we were based in San Francisco, Indiegogo was based in San Francisco, and every time he would come
to one our board meetings, his name was Lewis, I would say, “Hey Lewis, what else are you doing while you’re here in San Francisco?” And every time he would say, “Oh, I just had a meeting
over at Indiegogo. That is the most amazing business. So exciting what they’re doing, the way they’re empowering entrepreneurs.” – So he’s inspiring you? – Every time. – He was like damn I need
to get on board with this! – Every time he would
come he would be like, “Alright let’s talk about Tynt, but let me really tell you about what’s
going on at Indiegogo.” In the end Indiegogo
got acquired and then, I’m sorry, Tynt got acquired, and then Lewis introduced me
to the founder of Indiegogo and things just progressed
very rapidly from there. – Well one of the founders, wasn’t there like three people? I forget. – Yeah there was three
cofounders of Indiegogo, one is named Slava Rubin. He was at the time the CEO of Indiegogo. We also had two other cofounders, Danae Ringelmann and Eric Schell. Danae and Eric were both business students at the Haas School of
Business at UC Berkeley when they had the original
idea for Indiegogo. – Are any of them still involved? – Yes, actually both Slava and Danae are both still very active
members of the board and Eric Schell is our head
of product at Indiegogo, overseeing all of our product development. – So how did you get convinced? You keep hearing about how
what a great place this is and they’re just changing
the world or whatever, and you know what was it
that sort of persuaded you that this is the place
you wanna just like, “I got my stake in the ground here.” – Yeah you know it’s interesting for me it’s always been about
working with businesses that are doing something
that’s transformative. So when I went to Yahoo in the late 1990s I was actually really excited about how the internet was gonna change the way we consumed our media. – That was the place
to be in the late 90s. – It really was. – Maybe not a few years later. – It’s sort of sad, I know. I wonder if at some time
people will remember you know that there was a time when Yahoo was sort of at the center of
so much of what was happening. – Oh, that’s where you went. – It really was. – You know like I remember
first getting online in ’94, ’95 and stuff and wanted to go to that Yahoo homepage
with all the categories. That how people surfed the web back then. – Right that was the way you found the best places to go and
I’ll say it was actually a really interesting time
because it was the place to be and attracted an interesting
and diverse group of people. It was actually in that period, it was an incredibly exciting place to be. So many people that I worked with at that time at Yahoo are now doing such interesting things now. Jeff Weiner who is the CEO of LinkedIn was somebody I worked very
closely with at Yahoo. Rob Solomon who’s the CEO of GoFundMe was somebody I worked very
closely with at Yahoo that, Yahoo people have gone on to do really interesting things. – It sounds like you’ve got that taste of like wanna be around innovation and things changing at that time. – Absolutely, and I think that industries are most interesting at the moment when they’re going through
real transformation and what was so interesting
to me about Indiegogo that I could see from the very beginning was the potential that
Indiegogo had to really change the way entrepreneurs
launched their businesses. The typical way that entrepreneurs always launched their businesses, I’m going to overly
simplify ’cause of course each entrepreneur’s journey is different, but the typical way that entrepreneurs used to launch a business
is they would get an idea, maybe they would start
working on it a little bit, and then they would go
out and raise financing and then they would develop the product and then they would
hopefully get a distributor and get that product into retail stores and then at the very
end of this long process that could last years, that product would show up in a store and only at the very end of that process would you find out if
there was an actual market for that product, if there
were gonna be customers. – Right. – What was so interesting about Indiegogo was the way it was radically
transforming that model. The way an entrepreneur could determine extremely early in the life cycle of their product or their business, whether there was gonna be
a market for that product and I could see early
on what we’ve now come to see over the last ten years, which is it that it would have a really transformational impact
on the way entrepreneurs brought their products to market. – Yeah, definitely. There’s been a lot of
products that have been funded through crowdfunding and then become these massive success stories. Not just on the platform, but they go on to like get venture capital and maybe even get acquired
or their own company, you see that time and again, (laughs) not every single thing is that’s the story for everything but it’s
definitely very possible and I guess if you’re a
VC or a bigger company you can sort of have that confidence when you’re thinking about
what’s the next thing and when you look at these projects and like oh okay this thing
made 400% above its goal, that’s a good sign. – Absolutely, you know what’s interesting is almost every party that’s sort of part of the entrepreneurs journey, every third party that the
entrepreneurs engaging with whether it’s an investor, a
distributor of that product, if they’re a product entrepreneur, the retailer, they’re all
basically making a bet essentially on whether
there’s gonna be a market for that product in the end. You know the VC is anticipating there will be a big market for this device and the distributor is
thinking a lot of retailers will be interested in this device. The reason that crowdfunding and Indiegogo in particular is so transformative is it makes that part of
the analysis so much easier. So what’s exciting about Indiegogo is in part that so many
entrepreneurs on Indiegogo have been able to go on and raise venture capital financing. Entrepreneurs on Indiegogo have raised over a billion dollars in
venture capital financing after their Indiegogo campaigns. – Nice. – But what’s also exciting
is the way the entrepreneurs have a much easier time
getting their products into Target stores, into Amazon, into Brookstone, into many retailers that otherwise might have had more questions
about those products. They can look at the success on Indiegogo, say I can see that there’s
a market for that product, I wanna carry it in my store. – Nice, it’s definitely
from everything you’ve said, it’s very clear how like crowdfunding changed a lot in the entrepreneur process particularly with products, but how do you think
crowdfunding itself has changed since it started getting very popular about ten years ago? I know at the beginning there was no equity type of crowdfunding, still is usually very perk based, it’s like the PBS or NPR model where you get this level
and you get the bag, and at this level you get
the thing and whatever, but now I know recently, I think it was a couple of years ago, that certain laws changed or security laws and you can do equity crowdfunding? – Yeah, actually. – So that seems to be a big
change in what’s happened, but how else has crowdfunding evolved? What are the main ways
crowdfunding has evolved over the past ten years? – Yeah it’s a really good question. There’s a few ways it’s evolved. For one thing the landscape has changed a lot over the last ten years, so when Indiegogo launched a little bit over ten years ago, Indiegogo was actually the
first crowdfunding platform. There was no Kickstarter then, there was no GoFundMe then, if you count Patreon there
was no Patreon at that time. Indiegogo was the pioneer of crowdfunding and over time other companies started to focus on crowdfunding. Kickstarter jumped in I
think about a year later. GoFundMe a few years after that. The main evolution in the landscape has been that as crowdfunding has evolved, different companies have developed their own individual areas of focus. So for example GoFundMe
now is exclusively focused on personal causes and
non-profit fundraising, and in fact Indiegogo earlier this year, we actually sold off the
portion of our business that was focused on non-profit and personal cause
fundraising to a company called YouCaring that
was subsequently acquired by GoFundMe so that’s part
of GoFundMe’s business now. Kickstarter has really maintained a focus on what they call creators. So those are filmmakers, musicians, the fastest growing category
actually on Kickstarter over the last few years has been tabletop game developers. – Oh really? Like these kind of like handheld things? – No not handheld things, like actual tabletop games, like Monopoly. – Yeah, wow. – And then Indiegogo in particular over the last three years
has really developed a focus on product entrepreneurs and helping those product
entrepreneurs identify if there’s a market for their product, and really take their idea all the way from an idea in their head all the way to a manufactured product that’s getting into the hands of their backers. – Nice, so you mentioned Kickstarter and I feel like you know
you guys were first, and then they came in and
then they kind of swooped up all the attention and the
glory in a lot of ways. Why did that happen? Is that just my perception? But I did look at some stats before this and it seems like collectively
they raised more money, I think it was something like 2.8 billion to I think Indiegogo’s about a billion. – Yeah we’ve actually raised now over 1.6 billion dollars in our history. – Gotcha, but why was
there this perception for a long time that
Kickstarter was the place to be. – Yeah, it’s a really good question. You know things changed a lot around, I believe it was 2012. 2011 or 2012 was when
the people really started to notice Kickstarter and the main thing that transformed things
was that Kickstarter had a single campaign on Kickstarter that was very successful
which was a campaign for this product called the Pebble Watch. – Oh yeah. – You might remember that, and at that time that
became the most successful crowdfunding campaign of
all time as of 2011 or 2012. It raised over 10 million dollars and so what happened
was Kickstarter sort of opened up people’s eyes to the potential of crowdfunding and for a while their name was somewhat synonymous with crowdfunding. – So did they just get lucky then? Basically they got that
one super success story because I think in
addition to the perception of Kickstarter sort of being
the bigger brother here, that there was a perception
that like Kickstarter, the standards are different so that you know there’s a certain bar that needed to be met there that maybe
didn’t exist on Indiegogo and maybe the perception
that it’s Indiegogo, anything goes there. Is that wrong? Or is that actually a
strength perhaps of Indiegogo, that it’s like maybe your
dreams are a little more harder to see but you’re welcome here still. I mean what is the correct
way to interpret this? – Yeah that’s a really good question. Yes for a long time and
even now in some ways, Kickstarter has had and continues to have a very different approach to how they accept entrepreneurs
onto the platform. For, you know, Indiegogo has
not only tried to be as open as possible a platform but a
also very flexible platform. So on Kickstarter
there’s basically one way to offer crowdfunding campaign. You need to provide your
product to Kickstarter. Kickstarter actually evaluates who can be on their platform, and who can’t be on their platform. To Indiegogo, we take a different approach in part because when
the company was founded the goal was to essentially
eliminate the gatekeepers so rather than, our idea
was why should the VCs be the only people to determine what products get funded
and what products don’t, and it’s our feeling that if we evaluated each product for whether
it was acceptable or not to our platform we would just be inserting ourselves as the gatekeeper, and with Kickstarter doing that, in our mind they’re inserting themselves as the gatekeeper rather
than letting the public essentially decide what
products get funded. So Indiegogo has always
been a open platform where any entrepreneur can actually run a campaign on Indiegogo. What we have changed in the
last couple years though to make the opportunities
much more clear to backers is that we now require entrepreneurs to be very direct about which stage they’re in, in development. So if you just have a concept, but you haven’t actually developed a working prototype of your product yet, you need to disclose that
to backers on Indiegogo. If you have a prototype, we actually verify that you
have a working prototype. If you say that you’re in production we actually ask for a production version of the product so that we can validate it. So we’re actually a more open platform but also with a set of rules to make sure that backers
that back campaigns know what they’re in for. – So yeah, there’s more
nuance to it, I guess, but it’s more democratic
in that simple way like what you said about like oh if we simply wait
listed every single thing, then we’re throwing
our own biases in there and why not just let the people decide. – Absolutely and what’s
wonderful about Indiegogo is that because we have
this different set of rules it enables products that
might not have gotten the opportunity to
launch on other platforms or be successful on other
platforms to be successful. One example that comes to mind was a campaign that ran I
believe about three years ago on Indiegogo was for a
product called the Flow Hive, and the Flow Hive was a new
type of beehive actually and apparently there had
been no real innovations in beekeeping or beehive development in the last 50 years. – Don’t tell Apple. – (laughs) And a father and son team from Australia came up with an idea for a better beehive. They put in on Indiegogo, they needed $50,000 to be able to set up a manufacturing
facility in Australia to be able to manufacture
the first beehives. Now at that point when
they hadn’t quite gotten to real manufacturing of the product yet, they might’ve had a hard
time being able to launch on Kickstarter, they
launched on Indiegogo. They raised, within two months, they raised 13 million
dollars to make beehives from an evolving and
emerging beekeeping community all over the world, and at Indiegogo we’ve got
thousands of stories like that, of entrepreneurs who you
might never have thought would have been successful but the public actually got this democratic opportunity to identify what they
were really interested in and directly communicate
that to entrepreneurs. – 13 million, wow that’s a
market I didn’t know was there. That’s gotta be an impressive
size for beekeeping. So Dave, I gotta ask you. How do you guys make money? – (laughs) I’m glad you’re asking! You know we actually just
announced this morning, we just had our first
profitable quarter in Q3. – Nice. – Indiegogo makes money
in a few different ways. The first thing, and the primary way that we make money is that we get fees that are a percentage
of the amount of funds raised on our platform. So our standard fee is a 5% fee, and so 5% of whatever
the entrepreneur is able to raise on Indiegogo goes to Indiegogo. The entrepreneurs on Indiegogo, and we really like that fee structure because it means that we
have a shared interest in the success of those
entrepreneurs on Indiegogo. If they’re not successful on our platform then they don’t need to pay us and if they’re extraordinarily successful on our platform then they pay us more. So that’s the primary revenue stream. – So if it’s 5%, and you’ve
raised over the years 1.6 billion, what is that, 800 million? – That’s 80 million. But that’s just the primary way. In addition, as more
entrepreneurs are using Indiegogo as a platform to go direct to consumers, which is really the big movement that Indiegogo is a part of. Now entrepreneurs are
bypassing traditional retail, traditional distribution mechanism and they’re selling their products directly to consumers
online and as we do that, there are more and more services that those entrepreneurs need. If they’re marketing their
product on Indiegogo, the often need help with marketing. Critical to a successful
campaign on Indiegogo is having a really good
video that demonstrates the benefits of that product. Indiegogo now offers
solutions to entrepreneurs to develop a really good video. – Is that like you have an in-house staff of editors, shooters? – Yes it’s a combination of both expertise in house and in outside video… – Tara’s ears there are perking up. – It’s actually really an exiting time. It used to be that if you
were a product entrepreneur and you wanted to raise
interest in your product, you know say 15, 20 years ago, the only way to do it
was with brand marketing and by creating a television commercial. Most of the entrepreneurs on Indiegogo now are able to produce a video for somewhere in the
neighborhood of $20,000 or in a lot of cases less. The most most successful campaigns, those videos are watched
by millions of people. – Oh, they’re just fun to watch. I feel like the crowdfunding formula is almost like the reality
show thing plus cool gadgets. I mean it’s like this
sort of addictive format you can watch them one
after another for hours. – They actually really are fun to watch, and they’re fun to watch
because it’s fun to see the most innovative products
that are coming to life, it’s also really exciting to see the entrepreneurs behind those products. When we’re marketed to
during the Super Bowl, there’s paid models and actors that are demonstrating that product, there’s something actually
really rewarding about getting to see an entrepreneur
actually explain this product that they have dreamed of and how they are trying to
bring that product to life. You know part of why Flow
Hive was so successful is that the backers on
Indiegogo just fell in love with the founder and wanted the founder and his dad to be successful
with this campaign. Earlier this year we had
the most successful campaign on Indiegogo on any platform over the last two years for an electric bicycle called Mate X and the founder of that company
is a female entrepreneur. She is a mom with three kids and backers get excited about supporting an entrepreneur like that. So yes, there’s something about the videos that’s just fun to watch, in part because it creates
a better connection between the backers of those products and the entrepreneurs that
are building those products and providing them to users. – Well congrats on your first profitable quarter, by the way. – Thank you. – So I understand as going forward, first of all Indiegogo is international, in a lot of countries. How many countries now? – About 230 countries. People back projects and offer products from over 230 countries
and I’ll actually tell you one of the most exciting
things about Indiegogo is that last quarter 48%
of all of the transactions on Indiegogo were cross border. – Oh wow. – So what we’ve created is a
true world wide marketplace for entrepreneurs to be
able to reach new customers by going direct to consumer. – Why have you had so much success in terms of being
international so quickly? I think you’ve been in a lot of countries for a while now but it
feels like that’s sort of a weird tough nut to crack for
a lot of services and stuff, but do you use a middleman? Is there a secret to doing that? – It’s a really good question. You know you asked earlier about how the crowdfunding industry is changed over the last ten years. As we at Indiegogo got really focused on product entrepreneurs, people are recruiting new products and wanted to learn if there was market for those products and
go direct to consumers with those products. Our worldwide strategy
became much more clear, the most clear example is China actually, needless to say, not only is a lot of product manufacturing
happening in China but now there’s been manufacturing
in China for decades. There’s a lot of great product innovations that are coming out of China. – I bet you could go down
to the Shenzhen market, grab all the components you need and if you’re an inventor, you know, bam, see if something works and then all you need is
Indiegogo to help you out. – It’s absolutely true, and so what we did, part
of why it’s worldwide is that Indiegogo really invested in making Indiegogo a worldwide platform. In the beginning when I
first joined Indiegogo a little over five years, we used four different payment processors, in part to ensure that we could support transaction processing
in those 230 countries. We’ve since been able to
streamline it somewhat, but we have a real commitment to being a worldwide
platform from the beginning and then in markets like in China, where there’s a strong
base of entrepreneurs, we’ve actually hired
people that are dedicated to that Chinese market and
so you mentioned Shenzhen, we have dedicated people
working for Indiegogo, there’s a little bit of a
complicated legal structure to be able to do this in China, but that are based in Shenzhen to create a streamline way
for China-based entrepreneurs to be able to reach a US
market with their products. – Well it’s huge. I think that could open up
a lot of stuff for you guys, but the thing is that we’ve seen this before a little bit, not exactly this, but I know Amazon has done a
lot in the last couple years to sort of open up its market place to international sellers,
a lot of them out of Asia, and they’ve received a
lot of backlash for it because some of these
are knockoffs of American or just other products and
they’re either not as good, or even if they are as good, they’re really undercutting
the innovation happening here because of the rapid
commoditization I guess of some of this stuff. Do you see a similar backlash
possibly on your side and are you doing anything
to guard against that? – Yeah that’s a great question also, Pete. We did see that. One of the things that’s still so exciting about working with a
relatively early stage company is that we can be really flexible, so we did see that. We started to see a lot
of knockoffs on Indiegogo, we also started seeing
a lot of distributors or resellers that were using Indiegogo as a way to just distribute products… – I feel like this is
your fake news problem. It’s nice to be democratic
and be hands off but at the same time you have to take some kind of active roll in
ensuring some quality control. – Absolutely, and yes we’re democratic but part of being democratic is also being hands on to ensure that we don’t have fake news so it’s a policy on
Indiegogo that you need to be the original
entrepreneur of the product and we have a dedicated
trust and safety team that reviews the successful
projects on Indiegogo and ensures that is
the actual entrepreneur that is running that campaign. We don’t allow distributors
or resellers on Indiegogo and of course if we get
notice of copyright violation or patent infringement
we’re fully compliant with the DMCA rules and in a lot of cases we’ll take campaigns
down if there’s any type of IP infringement
happening on our platform. So we did start to see that, we responded very quickly
and there shouldn’t be any products on Indiegogo
that are not products that are being offered by
the original entrepreneur behind that project. – So this may be old news, but I do remember there was a big story, it was probably like five years ago now but it was like I remember
the Kickstarter guys came out and basically wrote a blog
that went pretty viral, like this isn’t a store. I think they were getting
a lot of bad press for various things not really living up to snuff at the time, but I feel like obviously it is a store, in your case in some ways with the marketplace
and direct to consumer. Was that an overreaction do you think? Has it gone into more this
is a store with caveats or how should people look
at these today in 2018 and going to a crowdfunding thing, what is my expectation
or do I just have to be really sophisticated about it? – Yeah that’s a really good question. So it’s interesting, we’ve
done plenty of research with the backers of projects on Indiegogo and while people have many reasons for backing a campaign, maybe they know the entrepreneur, maybe they wanna make sure
that product gets built, what we learned from engaging
directly with our backers is that the primary reason
that backers back campaigns is because they want to get the product. That’s why they’re doing it. So when you’re in a situation like Kickstarter had a few years ago where they had this project
called the Coolest Cooler… – Oh yeah, infamous. – Yeah it raised 13 million dollars and even with the 13 million dollars was not able to deliver
that product to the backers. That’s a bad experience for users. You know frankly Kickstarter can say we’re not a store but when people spend 13 million dollars on a product that they don’t get, they’re
going to be very unhappy, regardless of what you say. So what Indiegogo, you
know, recognizing that this is a risk with entrepreneurs, we started working closely with companies that could help the entrepreneurs that the most successful entrepreneurs on Indiegogo manufacture
and ship those products, so a lot of entrepreneurs
went into trouble because, and I think this was the
case for Coolest Cooler, because they haven’t
really thought through all of the components that
they need for that product or how much manufacturing is gonna cost, so on components, Indiegogo has formed a partnership with Arrow Electronics, one of the largest component
distributors in this country. Arrow, for free, will actually
review your bill of materials if you’re an entrepreneur on Indiegogo and make sure that you thought through every single component that you need to manufacture that product. They will make sure that those components are not close to the end of life, requiring you to re-engineer the product. We formed partnership, if you’re a successful
entrepreneur on Indiegogo and say you sell 10,000 of your product or you get 10,000
backers for your project, you’ve gotta figure out how
to ship to 10,000 backers, so we formed a partnership
with Ingram Micro to make sure that
entrepreneurs have a solution for doing the logistics
of literally shipping 10,000 products. – That’s a lot of stamps. – (laughs) It is a lot of stamps! And as a result now backers
are much more likely to get their product than ever before because we know that for backers to be truly thrilled with
the experience that they have on Indiegogo they need
to get their products, regardless of what we say. So whether they receive the products that’ll make them most happy and I’ll add on that, in our marketplace we do guarantee fulfillment of the product, and of course the customer
satisfaction level is much higher in our marketplace than it is for overall crowdfunding. – ‘Cause that’s stuff
that’s already been created and gone through these
difficult humps I guess. – Exactly, for now those are projects that are further along and where we can have
much higher confidence that the backer will
ultimately get the product. – So one of the things that I think has changed a lot in crowdfunding, it’s not that new anymore, but is the established companies coming in and like oh this is actually a great place to sort of try out new, like part of their development process, I’m thinking specifically
most recent thing I can think of is Bose
with their sleep buds… – Yes. – Had a campaign, I think
it was early this year or late last year. – Late last year. – ‘Cause I went to their launch event, I think was summer or the spring, and they told me all about
the Indiegogo experience and it was really interesting because it always a very
different product for them, they’re usually speakers
and headphones and stuff, and this is like a sleep masking thing and it was a different experience and they were like well
we could develop this on our own and just put it out there and hope for the best, but given the nature of the product which wasn’t a giant thing, it was a very personal product too, it’s like they concluded
we should do crowdfunding and they partnered with you guys and I tried it out, it’s a nice product, but that whole idea seems
to have really caught on and has it exploded lately
or has it held steady? – It has, yeah, within
Indiegogo we refer to this as our enterprise business but we’re really talking
about really well established companies that are using Indiegogo as a platform for product validation. My favorite example most recently, just last quarter was Gillette. So Gillette as I’m sure most people know, you know Gillette of course
is in a competitive business in the razor business, and particular with some recent direct to consumer brands
that have come along, and Gillette is of course
always innovating with razors and Gillette developed a new heated razor, and the old model would have been to get all the way through development and then do a big marketing campaign for their new razor. What Gillette is realizing, which is what most great
direct to consumer brands now are doing that it’d be worthwhile to get out to consumers earlier. So Gillette actually launched their heated razor on Indiegogo, they launched a project
actually for their heated razor and they’re doing it in part
to get their first customers, but of course Gillette has a very robust distribution system, drug stores and all kinds of
stores all over the world. What the enterprises are
really using Indiegogo for is similar to what Bose, like Bose launched a
campaign on Indiegogo, is to connect with consumers early, and get their feed back and figure out if the price point works for consumers, to figure out which features are most important to consumers, to get consumers to test that product. That Bose campaign, Bose did
something pretty amazing. Bose actually sent an early prototype to all of the backers of that campaign that bought the headphones
to get feedback. They collected that feedback and then after they got that feedback and they made some
modifications to the headphones, they then sent all the backers the actual commercial
version of those headphones. – Right, that was pretty sweet. Like a big company can sort
of afford to do that too. I don’t know if every start-up can model their campaigns
after that, but… – Exactly, but for them it was a great way to connect with customers. – Oh, and establish so much goodwill. – Absolutely, and if I’m Bose, or Whirlpool has run two
campaigns on Indiegogo, I love the Whirlpool example. Whirlpool, known for
their washers and dryers, launched a kitchen appliance that was a composting machine
on Indiegogo actually, and they did it primarily
so they could connect with early adopters and
get feedback on the product and I asked when I was in
meetings with Whirlpool, I asked them how would
you connect directly with consumers before Indiegogo, what would you do if you
couldn’t do it on Indiegogo? If they’re selling
products through Best Buy, Best Buy doesn’t tell them
who the customers are. If they’re selling, for any
of the other enterprises that are selling through
Amazon or Walmart, they hold that information
very close to the vest. So what Whirlpool told
me is that the primary, before Indiegogo, the primary way that they would find out who
their actual customers were, was from people sending
back those warranty cards. – We’re not doing it online now. It’s all about data. – It is, so the enterprises on Indiegogo, they not only get their
first few thousand customers but those first few thousand customers become their focus group
and the benefit to backers is that they get to have
a voice in those products that are created by those great companies. – I have to ask though, I know with this idea there’s
been a bit of a backlash from sort of the true Indies, like oh wow this is supposed to be, like you’re letting these guys in. This is supposed to be
our place for start-ups and people just starting out and how do we stand out when there’s these bigger fish swimming in our pool. Now I remember, I think
this was Kickstarter, but it was again years ago, but when the big films
or stars started asking, like Veronica Mars and
there was Zach Braff had this thing, I think it was Zach Braff that got the most heat for it, but they’re like hey this is, get out of here established people, this is not your pool. What has been the reaction on Indiegogo to some of this enterprise stuff? – You know honestly, directly
we’ve heard very little negative backlash from the entrepreneurs on our platform and you know we’ve had over 800,000 people that have raised money for different things on Indiegogo and we’ve had almost no
negative feedback directly, and the main reason is
that the entrepreneurs recognize that these established brands bring a lot of new users to the platform and while they may come to see that big enterprise campaign from Bose or Whirlpool or General Electric or Lego or some of the other big brands that have used Indiegogo, while they’re there they
tend to browse around. – I was looking at some stats. There’s something like 22% of your users back more than one campaigns? – Absolutely and if they back one of these large enterprise campaigns
then they often elect to join our email lists and they’re getting notified regularly of the latest and greatest
innovations on Indiegogo. So what those large
enterprises do actually is they really help build the community of early adopters on Indiegogo that then get turned on
to innovative projects from small and large entrepreneurs alike. – Nice. So what’s next for you guys? – So a lot of things. You know the big things
that are coming up for us is continuing our worldwide expansion. We’ve been thrilled to
see the tremendous growth that we’ve had in China and we’ll continue to explore how we enable entrepreneurs
from all over the world to reach audiences elsewhere in the world. We’re also continuing to implement to form new partnerships to help entrepreneurs be more successful in
manufacturing their products and shipping those products so you’ll see over the next
year more announcements of partnerships to enable entrepreneurs once they’ve raised a lot of
money to be more successful. You’ll also see us rolling
out even more services to make the whole crowdfunding experience easier for entrepreneurs. You know the entrepreneurs on Indiegogo are often great at having
innovative ideas for products, at developing products, they may not have great experience in running a digital marketing campaign to make that project successful and building a large community, that may not be their strength, so you’ll see us doing more there, and you’ll start to see us in the beginning of next year exploring more and more
with guaranteed shipment of products as we have more established entrepreneurs using Indiegogo, they’re less reliant on the funds that they raised in their campaigns to be able to ship their products and they’re able to
actually guarantee that that product will ship. For example Lego launched their first toy aimed at adults on Indiegogo
a couple months ago and of course Lego… – Aimed. – What’s that? – (laughs) There’s a lot of adults I know that are into Lego. I’m asking for a friend. – The reason I say that
is that I’ve learned from experience not to say that Lego is launching their first
adult toy on Indiegogo. – That would be really off brand for them. – Exactly and at Indiegogo we’re actually in awe of Lego the way that
they inspire innovation and creativity from young people. There’s so many entrepreneurs on Indiegogo that have told us about how
they started developing things actually playing with Legos as children, but Lego knows that they’re
gonna ship their product. Gillette knows that they’re
gonna ship their product. Indiegogo’s having a lot of repeat entrepreneurs on our platform. Mate X, which I mentioned earlier, which was the most successful
campaign on Indiegogo, this was their second
campaign on Indiegogo. They know how to manufacture
an electric bike, and while we didn’t do
it for this campaign, they’re in a position to guarantee that that product will ultimately ship. So you’ll see more guaranteed shipping as a way to build back our
confidence in our platform and ensure that we have
a really happy community. – Sounds great! So if you don’t mind I
would love to transition into some fun time questions. – Fun time! Okay, let’s do it. – Fun questions, okay. So it’s a bit of game. – Uh oh. – Now we have five questions and the first three are
part of a guessing game and the other two are, well they’re are kind of a guessing game. – Uh oh, okay. – But the first three
are you have to guess whether this project is
funded or not funded. These are all Indiegogo campaigns. – Oh really? Okay. I’ve got a little bit over
800,000 to think through. – I know you have to scan real quick. – Okay, let’s do it. – Okay so the first one… – Sorry just one clarifying question, is it whether the campaign existed or whether it got funded? – Whether it got funded. The first three are all real campaigns. Did they reach their funding goal or not. – Okay. – Alright, the first one is the Candwich. ‘A pocket sandwich in a self-heating can.’ – I’m guessing yes it
reached its funding goal. – It did, you got the first one. – Yes, okay. – It was funded. Alright second one, Bug-A-Salt. ‘A miniaturized shotgun
effect is generated through this ingenious
design for killing flies and other pesky insects using
only ordinary table salt.’ Was that funded or not funded? – Yes, funded. – Oh wow, the great confidence. And it was, it was in fact funded, so two out of three so far. – Okay. First of all isn’t this a testament to the Indiegogo platform? That these amazingly unique projects could actually get fully funded. – Especially the amazingly unique names. – Imagine the Bug-A-Salt people showing up at Andreessen Horowitz
and trying to get funding for the Bug-A-Salt. – Bug-A-Salt, it’s like the guy that would leave dejected from Shark Tank. Like I didn’t get a vote, what? Alright third one, Aliens and UFOs. A small business ‘making gray alien dolls and selling UFO/alien related products.’ Started by a retired grandmother. – Oh, did it get funded? On that one I’m gonna guess no. – It was not, you are correct. – Wow. – I feel bad for the grandmother. – Yeah. – But what are you gonna do? – It’s okay, she was able to
do early product validation, I’m sure she moved on to something. – You did great, you got
three out of three so far. – Okay. – We’re going into
advanced stuff now though. – Oh boy. – So this next question, I’m gonna read three campaigns to you, one of them is fake. The other two are real Indiegogo campaigns that were on the site. So you’re not choosing
funded or not funded, these are just three
campaigns, which one’s fake. First one, a new tooth. A YouTuber raised money
for his broken tooth. He broke his front tooth
in half one weekend. He said it was ‘gross’ and that it was ‘nearly
impossible to eat sandwiches.’ He has no dental insurance and it’s gonna cost him ‘an
insane amount of money,’ so of course he turned to Indiegogo. Second one, or do you wanna
make a judgment right now on whether that’s true. – No I’d like to hear all three. One is not true of the three, correct? – Correct. Second one, a self-declared
lifelong introvert got a notification that
it was the birthday of a high school classmate who he hated. He set out to create an app that would help you mute
all birthday notifications. Where the app couldn’t
just mute them for you, it would recommend turning
off certain notifications in apps or deleting certain calendars. Birthday notification muting. – Okay. – And the last one is the Audiopill. You swallow this pill
and it starts beating at a certain number of beats per minute. It’s a techno party in your stomach that you can’t escape. The creator says that ‘the beating within your abdomen
induces a unique feeling of restlessness, amazement, and elation.’ The battery lasts for only ten hours but it can be switched
off after you swallow it. – Wow. – One, two, three. So those are three campaigns. Which one’s the fake? – Which one’s fake? – Is it the new tooth, the birthday muting
idea, or the Audiopill? – I’m gonna go out on a limb, I’m gonna guess the birthday
muting is the fake one. – And you would be correct. That is the fake campaign. – Wow. – Very confident. Did you know the other two? Have you even heard of those? I feel like the Audiopill
might have gotten around. – I vaguely remember the Audiopill. There may have been Food
and Drug Administration concerns (laughs) played into that one. – I believe that, I could see how that could happen. – Yes. – Okay so you got four out of five. – Wow. – We’re going to the bonus round. This is it, the last question. So this is the tough one. – We can’t just stop right now. I can’t just take my money… – (laughs) You can bank it. No we gotta go, we gotta do this. – Alright. – We’re on this journey together now. – Okay. – Okay, which Indiegogo campaign, of these three that I’m going to mention. Which Indiegogo campaign did I back? – Oh, that’s a great one! – Me, which one did Pete Pachal, host of MashTalk, back? Was it the Banana Phone? A yellow, ‘banana shaped,
Bluetooth enabled, mobile hand set that connects
to your smart phone.’ It’s ‘a phone with appeal.’ Was it the Morpher folding bicycle helmet? It is said to be the ‘world’s
first fold-flat helmet. Morpher folds and unfolds
quickly and simply so it’s perfect for
cyclists who wanna carry a helmet more easily,’ or was it Super Troopers 2? The 2018 sequel to the
2001 film Super Troopers. A cult comedy from the
Broken Lizard comedy troupe. It’s all about the high jinks of the Vermont State Troopers. Which campaign did I back? Was it the Banana Phone, was it the Morpher folding bicycle helmet, or was it Super Troopers 2, which came out early this year. – Oh, Pete I’m gonna go with a testament to you on this one. I’m gonna guess, you look
like a fairly fit guy to me, I’m gonna guess that you are somebody that travels to work by bicycle and you went with the
Morpher foldable bike helmet. – And it was the Morpher! – Wow. – Dave, you got five out of five! You nailed it, you aced our test. – This is amazing. Where do I claim my prizes? Is that somewhere just outside the studio? Or do they have to be shipped to me? – Yeah we’re gonna need some
help with that shipping, I think you guys… – Alright, so I leave my address? – Exactly, maybe we need to get plugged into your marketing and all that stuff. – I can do that, I’ll leave our address so our whole team can share. – Yeah we’re gonna need some help on that, but congratulations. Thanks again for coming in and answering all our questions, including the silly ones, and letting us know about
what the future’s in store for Indiegogo in crowdfunding. – Okay, sounds wonderful
Pete, this was great. Thank you. – Alright, thank you.

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