Igniting That Startup Spark
That is the question I asked myself a few month ago, while listening to Brian Meece, founder and CEO of RocketHub, the third largest crowdfunding platform in the US, who was speaking at a Startup Weekend event I co-organized in Orlando, FL. Crowdfunding (alternately crowd financing, equity crowdfunding or hyper funding) describes the collective effort of individuals who network and pool their money, usually via the Internet, to support efforts initiated by other people or organizations. As Brian was speaking, my mind was spinning in many directions. Can this help my startup? How? Can the funds raised make a real difference or is the potential exposure enough?
I had heard and read about the outliers, the companies that had set out to raise a certain sum only to exceed that sum by a huge factor, millions in some instances. The majority of those seeking to raise funds, even if they raise their target amount, raised only a modest sum. However in 2012, these small sums reached in total an excess of $2.7 billion and have funded more than a million campaigns worldwide. A study by Massolution forecasts an 81 percent increase in global crowdfunding in 2013 to $5.1 billion, the hockey-stick growth rate everyone seeks.
With that knowledge in hand, I approached Brian and discussed my current venture (yes, once an entrepreneur, always an entrepreneur) called World Housing Solution (WHS).
The earthquake in Haiti catalyzed the founding of WHS. My partners and I had just developed the concept of our structural insulated composite panels and the tragedy that was unfolding just a few miles off our coast was the perfect place for us to launch our concept. Using Space Age composite-sandwich-construction methods, we developed rapidly deployable and reusable shelters and structures that are a solution to today and tomorrow’s emergency, temporary and affordable housing needs.
After reading report after report about the lack of safety and deplorable living conditions in tent villages, we knew we could come up with a better way to help the displaced, both here and abroad, by natural and man-made disasters. The reusable shelters can also be used to respond to military deployment and temporary labor housing needs. Movable factories that create the structures can be quickly built anywhere.
Although we made some headway in getting noticed by the government and won a few contracts, we were starving for exposure and capital. With that in mind, we dove headlong into a crowdfunding campaign.
So how did we do?
The campaign is still ongoing. However, on the exposure side, we hit the jackpot. RocketHub was quietly working with the cable TV network A&E TV to establish a strategic partnership affording both an interesting storyline for the network, as well as exposure for nascent organizations on RocketHub. Together, they launched a multiplatform initiative called PROJECT STARTUP and selected WHS as one of the first projects to be featured. We are still trying to figure out exactly what it means, both in the short and long term.
One thing is certain; crowdfunding has come through on its promise of exposure. Like anything that comes up along the entrepreneurial journey, it is what you do with opportunities that truly matter. We were given a spark, and we are trying to turn it into a raging inferno.
Editor’s note: This post first appeared on Wharton’s Entrepreneurship Blog on May 8, 2013.