Crowdfunding platforms like Indiegogo or Kickstarter can sometimes be the perfect place for inventors looking to launch their products. They can fall well short, however, for entrepreneurs looking to build their businesses.
That truth is all too common for creators who generated plenty of hype through crowdfunding but eventually found that life beyond Indiegogo or Kickstarter can be hard when you have to form a company, manufacture goods and ship products. It's easy to promise the next great wearable or drone, but forming a business plan around those ideas is another matter.
On Tuesday, San Francisco-based Indiegogo announced that it would try to make that process a little easier by launching "InDemand," a service that will allow campaign owners who reach their fundraising goals to continue using the site to take pre-orders, market their wares and track customer data. The company has been piloting the program for more than two months with selected projects, and with the move, becomes something of a niche e-commerce platform that moves beyond just crowdfunding.
"InDemand gives our customers the turn-key solution they have been asking for to reach a larger audience and move into the next phase of their company’s lifecycle,” said Indiegogo CEO Slava Rubin in a statement. "Results from the pilot are strong and we are excited to roll out InDemand globally."
While there have been third-party solutions like Shopify and Shopstarter that have allowed crowdfunded companies to build online shops following Kickstarter or Indiegogo campaigns, InDemand will be handled in-house, allowing successful projects to transition easily into a central place for taking and maintaining orders. InDemand projects will be able to take pre-orders globally, though it's unclear how much Indiegogo will be taking as part of its fees. The company currently takes 4% of all money raised from campaigns that reach their goals.
Indiegogo's move comes after
InDemand will directly compete with that, allowing project managers to continue to sell their product on their Indiegogo pages even after reaching funding goals or time limits. Indiegogo has tested the program with at least half-a-dozen projects, with one, a desktop sound amplifier called Geek Pulse, raising an additional $1.4 million in pre-orders in addition to its $1.1 million crowdfunding campaign.
“After Geek Pulse raised a staggering $1.1 million, interest in our entire product portfolio really began to take off,” said Gavin Fish, whose LH Labs oversees Geek Pulse, in a statement.
For Indiegogo, which is entering its seventh year of operation, InDemand may evidence a shift in the company's focus and, at the very least, is a diversification of its business. The company raised $40 million last January from investors including Kleiner Perkins and Insight Venture Partners.
