Thanks for having me on.  I’m excited to talk about crowdfunding and let your audience know how to crowdfund successfully.

Yeah, I’ll squeeze 25 years into a minute! As you said, I grew up in the ice business.  My dad sold it for a living and yeah, you can actually make a living selling frozen water – a lot of people laugh at that.  He started that in 1986 and I grew up just being in the business.  I was born an entrepreneur and I saw what it was like – he failed and he succeeded and he went through all of it and I got to take that all in, so I guess I had an advantage early on.

So what I did is I went off to college and it didn’t go so well for me, I almost dropped out. I got a 1.68 GPA but I turned it around and got my degree, but I learned how to get extra credit and just do whatever I had to to pass my classes.

It wasn’t until one day my life changed when I was introduced to a book called “Think & Grow Rich” by Napoleon Hill.  It’s a great book, anyone listening, read the book – it will change your life.  It changed mine.  What it came down to is I realized in life I wanted to do something great, I wanted to do something just spectacular that people would never forget.

One day I was on an ice route and I had a warm beverage and I wanted to keep in cold longer.  Obviously I had a truck full of ice, but it’s time consuming putting ice in a bottle and I wanted something that would fit inside easily to cool my drink.  Not only that, flavor it as well.  That day, I came up with the idea and invented a product called the Arctic Stick, the only product on the market that both cools and flavors your drink.

I went to Iowa State with it, won a class competition and fast forward, I partnered with a product development company and went on a couple pilot episodes of TV shows.  I had a lot of success – patent, trademark, the whole nine yards.  I even got a Shark Tank casting call which is quite the experience that led me to get on USA Today.  I finally had the Arctic Stick hit market, it went on Amazon where you can actually buy it right now in a six-pack.

What it led me to do is a crowdfunding campaign.  I had hit a brick wall – I had funded this on my own doing real estate on the weekends, selling real estate, working odd jobs, you name it.  I did it without giving up any equity.  I saw what Kickstarter was doing and did some research on how to crowdfund and decided to do a Kickstarter campaign because I needed $25K to pay for the machinery and tooling to mass produce this product.  I did a Kickstarter campaign that was 33 days long and we raised over $26K.

I thought I knew what I was doing going into it, but in reality I didn’t know squat.  I mean, I had a lot of things go wrong.  I did get national media attention and I did get backers from 25 states, 10 countries and I even had investors offer to invest in my company just based on the campaign.

I saw the power of crowdfunding, but I also saw how many people were failing at it and it frustrated me because as an entrepreneur, learning how to crowdfund successfully is a way to really help you make your dream come true.

So I went on a mission on New Year’s Eve, which is also my birthday.  It was December 31, 2014 and my New Year’s resolution was this: I wanted to become the most knowledgeable person of my time in product development and crowdfunding.  So I set out to do that.  I studied the industry, I even studied the guys that created the “Coolest Cooler” that raised $13.2 MILLION on Kickstarter.

I went all over the country. I created the podcast that was rated one of the 50 most influential in the country. I ended up writing a book on how to crowdfund, and the weird thing that shows how unique my fame is, I’m the only person in the world who goes on TV across the country and gives my crowdfunding pitch and promotes crowdfunding campaigns in that city.  I don’t charge for it, I just promote the campaign and help them raise money and it’s one of my ways of giving back and I really enjoy doing it.  So I became part of the crowdfunding industry and let me tell you, for anyone out there who doesn’t know crowdfunding, you better get to know it.

People sometimes look at crowdfunding as a way of getting donations, but no, it’s someone going out there and getting money for their business and for some you can basically pre-order a product but for others (and I’ve worked with celebrities on this) it’s a great way to promote a product like a book to get national media attention.  It’s the cheapest way to make a product go to market, it’s a no brainer.  Why wouldn’t you use crowdfunding?

So today I hope to share with your audience everything I’ve got to succeed with crowdfunding and hopefully they can use it in their own business or whatever else they want to do in life.

The main crowdfunding platforms people would know are Kickstarter, Indiegogo and GoFundMe:

• Kickstarter is all or nothing – you set a goal and you either raise it or you don’t and if you don’t reach your goal you don’t get any money.
• Indiegogo lets you raise money for just about anything.
• GoFundMe is used more to help support people if they have medical bills or anything else.

What it is is an online platform where you add your idea in what is almost like your own webpage with information, with pledge levels, with your product and with a video.  You put up a campaign, typically for about 30 days and you raise money for your idea.  You say “Hey, this is what I’m trying to do and I’d love to have you be a part of it.  If you can help me raise this money I’ll create it and you’ll get first dibs on the product.”

And that’s what crowdfunding is, it’s a way to raise money from the crowd without having to give up equity, for your company or idea.

Crowdfunding even increases the value of your company – let’s say you do raise money through crowdfunding and you have proof of concept but you still need to go the investor route later – you have a higher valuation on your company.  It also gives you national media attention and real life feedback.  Crowdfunding is a great way to launch a product, start a business or fund a cool idea you have.  That’s what it’s all about.

This is one of the reasons I wanted to help increase success rates – a lot of people fail.  I can’t tell you off the top of my head but the failure rate is very high.  What people do is throw up a campaign and just assume they’re going to succeed and be an overnight sensation but it doesn’t happen that way.  The majority of campaigns that get funded have a goal of $10K or less.  I will say this, there are the top three mistakes you must never make (and this is across the board) from everything I’ve ever studied.

• Number one, the boy scout mistake – lack of preparation.  Like a boy scout you need to prepare ahead of time for things but a lot of people don’t prepare.  They put up a site and think they’re going to just drive traffic there and get a lot of money but that’s not how to crowdfund your startup, you have to prepare ahead of time.
• The second one is what I call “Steve Jobs stupidity” – expecting it to happen without any promotion.  What was Steve Jobs known for?  Obviously the iPod and iPhone, but when a new product came out people lined up for blocks to get it.  It’s the same with your crowdfunding campaign, you need people lined up to back it on day one so you can get a lot of hype.
• The third one is the value meal.  Not giving enough value for the dollar the way a value meal does.  Putting different reward or pledge levels on that are a no-brainer in adding value.  People won’t just give you money without getting something.  When’s the last time you were on the street and a homeless person asked you for $20 and you gave it to him?

 That’s my point.  You can’t believe that people are just going to give you money.  I’ve been a director of a non-profit and seen what it’s like to raise money for sympathy and it’s hard.  So those are the three mistakes that people make and I can go through my FUND Formula that I’ve come up with and written a whole book on, for crowdfunding success.  If you follow the FUND Formula, that’s literally all you’ve got to do to learn how to crowdfund.  It’s simple, follow it and you’ll succeed.

 I bet it will answer all of them, and if not I’ll answer them.  So the formula is simple to remember:  FUND Formula.

F – Forethought

U – Utilize marketing plan

N – Narrative

D – Deliver value

Forethought – You need to prepare your marketing campaign 45 – 60 days ahead of time. Put in a lot of work, you may have up to 200 hours into your campaign before you even launch.  Put up a landing page or website that you direct people to when you promote your campaign.  Have an opt-in to build up your email list and promote to these people. Give them exclusive offers for day 1.  Promote on social media and get your audience ready for the big launch day.

Also put in all of the content.  You need to put in the graphics, the text, the copy. Put your story together and put together the pledge levels.  You have to create an awesome video.  There’s just so much work involved with it.  The plan is on day one, you’re ready to launch.

Your goal is to hit 40% of your total funding goal in the first 48 hours. If you do that, not only is your chance of success higher, but your chance of getting featured on the first page of Indiegogo or Kickstarter is higher.  Your chances of getting organic and going viral are so much higher.

So how do you get 40% of your funding goal in the first 48 hours?  You get people committed to pledging – family and friends.  If you have a product, you find a wholesale distributor and offer a discount if they pledge on day one.  That allows you to get a lot of sales early on and then you go organic.  So that’s the whole forethought process – there’s a lot involved.  Like I said, I wrote a book on it that goes into detail about everything.

Yes, you’re basically using a landing page or website to build the hype, as well as social media.  You’re building a following, sending emails out and making sure people are aware of what’s to come.  You can do a soft launch and send a preview link of your campaign before it goes live and get feedback, which I suggest.  Getting feedback from the audience helps you customize it to how they want it because once it’s launched you want it speaking the language of your specific target market.

So, Kickstarter picks their features but obviously if you get a lot of traction they’re going to probably feature you.  For Indiegogo it’s called the “GoGo Factor.”  It factors in the number of pledges, the amount of money per pledge and the amount of time it’s done in.  Also a combination of comments and shares.  That combination of different things is the “GoGo Factor’ so if you excel at all of them and raise a lot of money in a short period of time and get a lot of shares and a lot of comments on your campaign, that allows you to trend.  I’ve had campaigns trend on Indiegogo that way.  It also gets you a better chance of being featured.

I just interviewed someone for my podcast and their campaign was called “Thin Ice” and they got featured on Indiegogo because they really excelled at the GoGo Factor and in 24 hours they did over $150K in sales.

Yeah.  That’s because they got featured by hitting that GoGo Factor.  So that’s your formula.  The more traction you get with something, you build momentum and it just snowballs from there.  But you have to get that initial momentum so it’s all the work you put in ahead of time to get that big hit, that big hype right out of the gate.

This is a very good point, I’m glad you’re asking these questions.  So when you think about it, Indiegogo and Kickstarter are businesses.  They want to raise a lot of money, so if they see that you’re having a good chance of success, they obviously want you to get more views and raise more money because then they make more money.

Kickstarter and Indiegogo both take 5% of your total raise.  So you have 5% from Indiegogo or Kickstarter, but you also have payment processing fees from Paypal or Stripe (for Kickstarter).  The payment processing fee is 2 – 3% plus i believe 20 cents per transaction.  So figure 8 – 10% of your total raise will go to expenses.  The rest obviously goes to you but you still have to pay the expense of the campaign and for the pledge levels and to actually make your product.

They need to take all of them into consideration and they need to put a budget together for the launch.  You’re going to be spending money on marketing and on your video.  The best way to bootstrap for any business including a crowdfunding campaign is to take the campaign on with multiple people and have them get a percentage of the total raise and just have them do their sweat equity work.  So do a budget and understand your expenses and figure them into your campaign funding goal.

The thing that drives me nuts is for anything, one person can give a whole industry a bad name.  There are campaigns out there that have raised the money and once they get it they just don’t create the product and they just run.  I saw one that was a pretty cool idea – this shirt technology for lifters that the fabric would emphasize where your muscles were working by changing color.  This did over a million dollars, this product. But it turns out they really had no intention of creating this product and they took the money and ran.  Stuff like that gives people a bad name and it’s not fun.

When I did Arctic Stick I was delayed by a year because we had a lot of things go wrong. My story for my manufacturing process was featured on the cover of Inventors Digest because of what went wrong.  I delivered, but I saw what it was like to see a crowd that gave you money get frustrated.  You just need to send updates to keep them in the loop, at the end of the day there’s nothing you can do.

Sadly, some campaigns don’t raise enough money because they underestimate the costs and they had no intentions of not delivering the product, but they can’t because they just don’t have enough money but they do still have the money they got so they’re thinking “What do I do now?”  That’s why we make sure people don’t have that happen because that is a nightmare that nobody wants.  Nobody.

…to U for utilize marketing plan.  You gotta promote to the MAX.  You’ve got to be like Steve Jobs, that’s the best example – when a product came out the whole world knew about it.  The best ads, everything.  Just like your campaign, you need to promote to the max.  I wrote this in my book, you get to the point of your social media when people start dreaming about what you’re doing, that’s when you’re getting in their heads and you’re really getting your point across.

Social media, beyond just doing tweets and posts, do targeted ads – spend money on Facebook.  It’s a great way to get a lot of traction and good conversion rates.  Beyond that, get on TV, get on radio.  Podcasting’s a big one – last month during our campaign I got on 15 podcasts, it’s a simple and great way to draw traction to your campaign. Blogs, send out to bloggers.

Get ambassadors, this is a big one when you’re figuring how to crowdfund.  If you’re listening, this is one of the biggest things for succeeding with your campaign.  What is an ambassador?  An ambassador is someone who’s willing to spread the word about your campaign and share with their audience.  A good ambassador would be an influencer, maybe Seth Godin or John Lee Dumas or anyone with a big name and a big audience.

This is what you do, you contact them and let them know what you’re doing and that you would like them to be an ambassador.  In return, you can offer something like this:  if they do one email blast to their audience and 2 – 3 tweets and social media shares on Facebook during the campaign timeframe you can offer an exclusive pledge level free of charge.  Some people will even pay a percentage of what they direct.  Give them something they can’t resist and they help spread the word.

If you get enough influencers…some of the big campaigns out there that raise millions, the reason for their success is because they either had a celebrity or they had a huge email list or something that they leveraged.  People don’t understand that you have to have a big audience, a following.  A celebrity makes life a lot easier for your campaign.  So ambassadors, and promote to the max.

Yes, they can be affiliates and you can, for example, offer them 25% of what they direct.  Indiegogo specifically shows you what people direct to you with their referral program. For some people, just offer to let them be part of it.  In a recent campaign, we had a picture of our ambassador on our site and a link to their site and we labelled them an ambassador and sometimes it can be enough to be recognized as that, and it doesn’t cost you anything.

You can do exclusive pledge levels like things that have a limited amount.  This is a good thing to get a lot of traction on day one, you can say to your audience “We’re going to limit this to only 100 people.”  Let’s say it’s a really sweetheart deal where it’s almost a giveaway, but that allows you to get a lot of backers right away.

You can offer your ambassadors an exclusive offer for no cost or you can offer them some other thing.  Just be creative when figuring out how to crowdfund.  Think of different resources that you can give them for adding value that doesn’t cost you a thing.  And when you’re looking for your ambassadors the ones that are more likely to help you are the ones that it makes sense because your campaign is in their field of business so for them it adds value to their audience.

 N…Narrative.  You’ve got to tell a great story.  I mean, for hundreds of thousands of years, the best way to inspire people, to move them or anything is through telling a great story. You need to be able to tell a great story through your campaign page.  People buy into stories.  The best way to tell a good story is through a great quality video.

Do a video that is 2 – 3.5 minutes at most that tells your story, shows people that you’re credible and that you can actually back what you’re saying.  If you have a product, focus on 3 – 4 main features of your product.At the end have a strong call to action that says “Hey! Pledge my campaign and in return you’re going to get this.”  It’s as simple as that, but I always say you need to have Hollywood quality video.  And this is where some people go wrong.Audio is everything, I mean don’t use the video camera audio, use a lav mic.  You can get a lav mic for $80 that can plug into your iPhone and in your Sounds App you can just record and then you do the camera after.  Then you just put both into iMovie, line up the audio and video and you have a great quality video that you can use.So I can’t emphasize enough if you’re just learning how to crowdfund, if I were you I would get a videographer to do it.  You can get a pretty good videographer and get the work done for about $2500.  You can get it done for less, but I’ve found a great one and it’s worth the $2500 because the video can make or break you.Beyond that video, below it tell more of your story.  Show pictures, have 15 – 20 high quality pictures of your product or what you’re doing.  Have text explaining it.  The best way to explain it is this…if you’re go into Walmart to buy a computer or buy anything, you’re going to look at the directions, you’re going to look at the front of the box and the back.  You’re going to look at every feature it has to offer and before you make an investment to buy that product you want to see everything there is.  On your sale page, give them everything they need to make a desicion to pledge for what you’re offering them.

D for deliver value.  Why are people going there in the first place?  They’re going there because they want something in return.  What value can they get from you?  What are you going to offer them?  So you’ve got to offer them high quality, great pledge levels.  Pledge levels where they’re willing to put their hard earned money into your campaign with no questions asked.

For a product I always say give it a discounted price level.  If it’s going to retail at $20, offer it to your audience for $15.  Show that value, offer customized swag, if you know any celebrity friends get them to hang out with the people for a day, just be creative.

Here’s a good example: You know John Lee Dumas, right?  He has a podcast called Entrepreneur On Fire and I’m working with him and we’re launching a book called The Freedom Journal.  It’s different when you have someone with that kind of authority on board.  He’s offering that for one of the pledge levels you can get on his podcast show.

You buy his book The Freedom Journal which helps you set and accomplish goals and one of the levels is you buy the book and you also get on his podcast show which has 1.2 million listeners, so you can get on his show for x amount of dollars.  That’s a unique thing that most people would pay for.  Or he’ll go on your show, or he’ll come speak to your audience.  He also has bundled packages for the book.

So you can see that you can be creative.  You can offer things that don’t cost you money, but basically just take your time.  Use the resources and knowledge you have to create products and pledge levels that support your main product.

So I can’t say it enough for those of you just figuring out how to crowdfund – offer great pledge levels.  15 – 20 of them, I’ve seen as high as 60.  35 is a good number, but i would say at least 15 – 20.  You don’t know how the market is going to react, they may like one pledge level but not another, and one could be a huge hit.  Have some where there are limited amounts, there may be only 100 or 1,000 available at that amount so there’s scarcity for people.

It depends…if you’re going to do Kickstarter, they’re very critical.  You have to fit into one of 13 categories.  Publishing is one of the big ones for them, and so is inventions.

So you can raise money for an invention, that’s a great one.  You have to have at least a functional prototype and drawings of your product before you can even use it for your campaign.  I spent $75K – $100K on Arctic Stick and the whole process is expensive because I didn’t know how to crowdfund a startup, but if I had known earlier that what you do is use your prototype and CAD drawings and your progress and put that on the campaign and it can help you raise money for the tooling which can be $25K, $50K to $100K.  So inventions is a great one.

You can launch a book, Eric Ries and Seth Godin did this.  They basically said “Hey, here’s a book we’re looking to create.  We already have a track record but we only want to create this if you’re going to buy it, so if we reach x amount of dollars we’ll create the book.”  One of them raised $200K – $300K and the other raised $600K.  These are authority figures and celebrities, they’re millionaires and don’t need the money but it’s a great way to launch a product.

Indiegogo, they literally let you raise money for just about anything. It can be non-profit or it can be for putting on an event.  We just did one called Young Entrepreneurs Convention where we pre-sold tickets to an event and used the money to pay for a venue and speakers and then we had extension goals we could reach that would add more features to the event.  It helped us build an audience and get a lot of media attention.  It built a lot of hype and attracted sponsors.  We raised $16K in 30 days, but it’s already helped attract $10K in sponsorship and it will probably help us attract another $50K – $60K beyond what you see in the pledge page.  That’s a great lesson in how to crowdfund successfully.

You have to look at it like this – learning how to crowdfund helps you beyond the money you raise.  It’s there for life, so that helps you attract more success.

So you have to look beyond what you do in the campaign in the timeframe, you have to look at the future effect.  I look at the crowdfunding campaign for my invention 16 months ago and I look at the power it still has today.  So this is something you’ll have forever – your own platform and audience to use.

So on Kickstarter and Indiegogo you can do updates, and once they pledge you get their email address.  I still do updates to old campaigns, and as you do updates you can direct them to your other platforms like your social media or your website.  Once they’re on that page you have that marketing outlet forever and when people go look at that page in the future even after the campaign is done you can have a button directing them to your site.

This makes crowdfunding a unique field because it’s a whole new audience you’re capturing.  So you can always maintain that crowdfunding platform and you can continue to direct that to your own platforms.

A great database.  And you can export this whole data file.  You have your amount per clicks, your conversion, where it’s coming from (Facebook, website, etc) and it gives you detail.  Every little detail about your campaign, it gives you the data you need for your idea.  You even get real life feedback, it’s like having a focus group from the crowd on your product which helps you.  A lot of people start a campaign and then change direction based on the feedback from the audience.

I’ve gotten well over $100K worth of publicity for free.  I’ve been on TV all over the country, I’ve been on the cover of Inventors Digest, USA Today, I’ve been in newspapers, blogs, podcasts, all of it.

It comes down to this: be entertaining and give them a great story.  Give the audience what they want and give the producer or journalist what they want, speak to their audience and they will give you what you want.  So don’t just ask someone to do a story on your campaign.  Provide value for them – I would talk about how to crowdfund and suggest crowdfunding for Christmas, or crowdfunding for keeping your New Year’s Resolution.

Give ways that the audience would be interested and a great story, and that story in return gives you credibility and traction when you get featured somewhere.  People see that and love your story and then they’re more likely to check out your campaign, check out your page and everything else.

I can speak for hours about this because there’s differences – if you’re getting on TV you’re pitching to producers, give them a great story, give them a segment which usually on TV is anywhere from 2.5 – 6 minutes long.  You don’t have much time but it can be great, I’ve been on a show before with a quarter million people watching – it’s dynamite.  It just comes down to giving a great story, give the audience what they want and make it entertaining.

This is beyond publicity and beyond learning how to crowdfund, whatever you do in business you need to make it fun, exciting and entertaining so people will care. Whatever it is, you can make anything fun.  So I try to make crowdfunding really exciting and entertaining so they want to work with me.  If it’s boring nobody cares.

I always tell journalists, “Any time you’re looking for a great story, this is what I offer.  I have credibility to talk about inventing, I have credibility to talk about crowdfunding, about how to crowdfund successfully, about entrepreneurship, publicity. This is value that your audience would love, so if there’s ever a time during the year when there’s a topic going on and you want an expert to come in, call me and I’ll be happy to give you value.”

For them, if you do the job for them it makes life easier because as a producer they have to find great stories and if you can throw one in their lap and do it for them, they love it.

Now they’re coming to me.  It took three months of hardcore work in the field to get to that point.  If you get two, three, four TV appearances, the rest will come.

In the last months I’ve had three write-ups in articles in main newspaper outlets, I’ve been on 15 podcast shows, I’ve been on TV and been on different blogs.  Success breeds success and publicity breeds publicity.  Take that credibility from your last work and use it.  But in the beginning you just have to sell.

Here’s one thing – if you want to be an expert in your industry write a book on it, and producers of a show love that.  They love when you’re an author and you can show your book.  They love that stuff and that makes it so much easier for you.  For me, my FUND Formula is what I give out in my segment.  It’s simple, I go through the three mistakes you must never make: the boy scout mistake, the value meal and Steve Jobs.  I have props for every one of them that you’ll never forget.  One guy said he’ll never look at a value meal the same way again.  And for the FUND Formula I use visuals that people can relate to and I’m energetic and loud and entertaining because if you do that, people watch.  If they’re entertained by you they’re more likely to watch and obviously that’s what TV stations want – they want more viewers.

 It’s free promotion.

The power of TV blows my mind.  Now that I’ve done enough of it it’s just an everyday thing.  It’s just like going to speak on stage about how to crowdfund or whatever else. But in other people’s eyes, they’re thinking “Wow, if that guy is on TV he’s obviously an expert and obviously I guy that I want to contact to work with me.”

You can find everything about me at brandontadams.com.  We do a weekly podcast, blog and my book is listed on there.  You can find my book on Amazon and even Arctic Stick is on Amazon selling like crazy right now.  If anybody out there wants any kind of advice or support on how to crowdfund just go to keystothecrowd.com.  We have all kinds of packages and support for you and I’d be happy to do a call with you and find if there’s any way I can help you succeed with crowdfunding.

Thank you so much.  I hope you enjoyed it and I really appreciate coming on the show.