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Kickstarting Perth

Many Australians sat up and took notice when New South Wales inventors Stuart and Cedar Anderson raised US$1 million in just three hours on Indiegogo, with their revolutionary beehive system called Flow Hive. They went on to break the record for the amount raised in a single day ($US2.2 million), and become the most successful crowd-funding venture ever outside of the US. The Andersons ended up raising over US$12 million by the time their campaign closed in April. They had originally set out to raise only US$70,000.

There have been many Perth-based success stories, though none on the same scale as Flow Hive. Leederville-based Cycliq is probably one of the better known local campaigns. Kingsley Fiegert and Andrew Hagen turned to Kickstarter in March last year to fund Fly6, a cycling camera/light combo, and raised $266,594 from 1,780 backers. They returned to Kickstarter twelve months later and raised another $668,721 for a front-facing version of the product.

Perth: a late starter

Despite Cycliq's repeated success, it's fair to say Perth remains a little behind the pack when it comes to crowd-funding. Based on the number of live campaigns on Kickstarter at the time of writing, we only rank second-last in Australia on a per capita basis.

City Current Kickstarter campaigns (per 1,000 capita)

Brisbane 0.25

Melbourne 0.20

Sydney 0.19

Hobart 0.17

Adelaide 0.17

Perth 0.15

Darwin 0.11

Source:, wikipedia

Statistics provided by Australian platform Pozible paint a similar picture, with Perth being the only capital city with a share of total campaigns less than its share of population (numbers weren't available for Darwin and Hobart). Pozible's General Manager Claire Merquita stressed these were estimates only, as "many creators don't specify a city, just picking a country, so we've got a lot of 'Australia, Australia' projects."

Notwithstanding the imperfections of the data, it appears that Perth is under-represented in the crowd-funding scene.

Recent Perth projects

So while Western Australia is perhaps a little late coming to the crowd-funding party, a recent flurry of campaigns appears to suggest Perth is waking up to the potential of funding projects and start-ups through the power of the crowd.

A project to open Perth's first cat cafe launched on Indiegogo a couple of months ago, and raised a whopping $150,000. I'm not a cat person, but understand the concept to be somewhere you go and drink coffee while stroking rescued cats. It followed in the footsteps of a similar project in Sydney which had previously crowd-funded about the same amount.

The combination of crowd-funding, social media and cats does indeed seem to present a recipe for viral success - at least based on my understanding of what's trending nowadays... That being said, I have to admit to having been a little sceptical about a project raising over $150,000 in Perth for a cat cafe (can you tell I'm not a cat person?). The difficulty with very localised campaigns like this one is that you're significantly limiting your audience, and so can't rely on global reach and virality as so much as on a very strong existing supporter base. At the time of the campaign I noticed that ten donations of $10,000 each were placed in quick succession on one day, suggesting perhaps one rather generous benefactor, or some self-supporting activity going on... Not that I'm suggesting there was anything untoward about the campaign! At least one other person appears to have genuinely contributed $10,000, out of the charitable portion of his mother's estate, according to Reddit. Then again, his "mother was a crazy cat lady" he explains.

Another very local-interest campaign launched last week on Chuffed, seeking to raise $100,000 to open a new museum focussed on Perth. At the time of writing this they'd only raised $2,785 with 13 days left to go. This is in spite of getting very good coverage in the local press, having over 3,000 Facebook and 6,000 Twitter followers, and a team which boasts a City of Perth councillor, Heritage Perth executive director Richard Offen, former MP and journalist Diana Warnock - and the guys behind Two Feet and a Heartbeat.

This provides a cautionary tale to anyone considering a crowd-funding campaign - it's not easy. That being said, I note that I have yet to receive any communications despite signing up for updates on their webpage, their Facebook page has been pretty quiet, and an earlier conversation about a cross-promotional opportunity and a plug in this article were not followed up. To a certain extent, you have to put in the hard work to get over the line.

Kindom is a Perth-based app which helps parents better manage their children's development, in particular children with developmental differences. It's being developed by Claremont-based KinChip Systems, and aims to connect parents with curated resources from expert sources in a digital format, covering everything from education to health.

KinChip Systems co-founder Catherine Resnick describes it as "like having your own parenting PA". She says they've turned to crowd-funding to "help raise funds to take Kindom from prototype to fully functional app, but also to raise awareness of what we're trying to do and to further validate it with our target audience." At time of writing Kindom is 3% funded with 28 days to go. They are aiming to raise US$50,000 in flexible funding (this means that, unlike normal crowd-funding campaigns, they will receive all money raised even if they don't hit their target).

Get on board...

Yet another local-interest campaign is being run by the Little Ferry Company, a local start-up founded by Kevyn Townley. Townley is an experienced entrepreneur who's previously operated a merry-go round at Perth Zoo and rickshaws in Fremantle, and so is no stranger to launching ventures in the tourism space. Townley has only just launched his campaign on Kickstarter, seeking to raise $60,000 to fund two electric powered boats on the Swan River (by way of full disclosure, I am running the campaign for him - so the pressure's on!).

Townley says: "we're putting two boats on the water later this year, and we will operate them as a boutique tourist service rather than on a commuter model. We'll be offering live commentary and a fresh perspective of the city's highlights. But we're also offering a charter service in the evenings, and the crowd-funding campaign is an opportunity to pre-sell packages where people can book a boat out for their family for an hour or two. Imagine watching the sun set as you sip a glass of wine and lay back in the luxury of a small boutique boat."

Kevyn has turned to crowd-funding to both raise money and, perhaps more importantly, validate the concept and raise awareness. Even Perth Lord Mayor Lisa Scaffidi has got behind the project, personally liking the Facebook page and writing a letter of support. Interviewed by the ABC News earlier this month, she said that "based on the number of people over the years that have suggested to me that they would like and welcome and use this type of transportation, I would think that there would be a good amount of crowd-funding to be had. Over time, with more offerings along the river location, it's going to be a very much needed alternative to other public transport means."

BYO crowd

Crowd-funding also offers the potential for established businesses to tap into an existing crowd: their customer base. Many businesses fail to acknowledge that the goodwill of their customers represents a very real intangible asset. Rather than viewing crowd-funding as something just for start-ups, small businesses should start thinking about how they can extend their existing service offering to customers, and involve those customers in the process. For instance, a cafe might look to fund a project to redevelop a backyard into a garden, or a shop may be looking to open a second location. These businesses can not only raise funds, but also involve their customers in the project, seek feedback on design alternatives, and ultimately leave their customers with a sense of ownership in the business - and therefore a stronger long term bond.

A Northbridge business that achieved something along these lines was Lucky Chan’s, which now lays claim to be Australia's first crowd-funded restaurant. The team behind the venture were the guys running The Classroom in North Perth, and as such had access to an existing customer base to market to. They raised $112,000 on Pozible. Backers were able to get their name on the wall or a chair named in their honour. What better way of creating a group of loyal customers who will return again and again and want to bring their friends to show off their name on the wall?

In the pipeline...

Pitches for Stitches is a start-up which emerged out of the last Perth Start-up Weekend a couple of months ago. It is a great example of a team attempting to make a go of an idea which emerged over the weekend-long start-up competition. They have taken the politically incorrect Cards Against Humanity concept (which itself initially saw life as a successful Kickstarter project), and somewhat sanitised it with a more corporate market in mind.

I met them during Perth Start-up Weekend and have recently jumped on board to assist with their Kickstarter campaign, which we hope to be launching in the next month or two...

Urbotanica is planning to launch a Kickstarter campaign later this year for the Urbipod, a portable kit you can grow herbs in. The team behind it includes Ray Hart, one of the co-founders of the WA Angel Investors, and Paul Avery.

Avery points to the advantages of crowd-funding as a source of capital for early stage companies. "Traditional sources of capital are just not available to start ups like Urbotanica. Banks are reluctant to provide funding for ‘unproven’ start-ups, particularly in innovative spaces [Avery previously worked for ANZ]. It can also be difficult securing investors in the early days and before the project is investment ready. There can also be a significant equity stake required to give away to seed investors at such an early stage. Crowd funding in a way allows us to put forward our project at a much earlier stage of development and we retain complete control.

We also believe that crowd funding talks to the right target market – early adaptors that respond to innovation and are keen to support its development."

Paying it forward

Last year I reached out to the Perth community for some guidance on a Kickstarter campaign I was planning, and have to say that people with first-hand crowd-funding experience were few and far between. I did end up having a chat with Michael del Borrello, who had been involved with the US-based Lifx campaign (the hugely successful wifi-enabled lightbulb project which raised US$1.3 million on Kickstarter in 2012). He was generous enough to share some tips and pointers with me over coffee.

Since successfully completing my first campaign, I have tried to pay this forward by helping other campaigns in Perth I come across. I'd recommend anyone planning a campaign to check out this piece I recently wrote (in an effort to get down in words some of the experiences I'd had to date). I have to say that now hardly a week goes by that I don't get a crowd-funding enquiry from someone about to start a campaign - maybe Perth is about to erupt in a frenzy of crowd-funding!

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