A couple of months ago Erik posted on Twitter, asking his followers to ask him anything about starting a business or anything related to digital marketing. He received a question from Sean Burke, who works with him at Array Digital. The question was what he thought about using crowdfunding platforms to get a project started.
Erik starts by saying he doesn’t have a strong opinion either way on crowdfunding. Platforms like kickstarter.com offer aspiring entrepreneurs the ability to put out a feeler for their product. Instead of focusing on creating their product, they focus on building up the kickstarter campaign to see if others are willing to invest in it. The positive side to that is that they jump right into validating their product from the beginning before investing too much time and money in creating it and putting it out there. Erik believes validating your product is the most important thing you can do in the beginning and for that reason he believes crowdfunding can be beneficial.
On the flipside he believes there are a couple of drawbacks to crowdfunding. First, You have to invest a lot of time creating your crowdfunding campaign. Second, instead of focusing on your product your focus is on getting interest in your campaign. Third, you will likely be selling your product at a discounted rate so you may not get an accurate idea of what others would be willing to pay for your product.
Overall, Erik doesn’t have a strong opinion either way, but he believes it can be a good way to validate your product. If no one shows interest in buying it then it may be time to go back to the drawing board.