As you may already know, a couple weeks ago I started a crowdfunding campaign to get my own laser-cutter for making jewelry. The idea is that my supporters sign up to back my project and they get rewards in the form of jewelry in exchange (in time for the holidays!) It’s a win for me AND my supporters.
Well, since I’ve started my crowdfunding campaign, I’ve gotten a lot of questions about it, so I wanted to answer two of the most frequent ones here. The first is, “Why crowdfunding?” and the second, “Why did you go with Ulule (vs Kickstarter or Indiegogo)?”
Since I started my business in 2015 (and went full-time in 2016, I have made the majority of my jewelry using a laser-cutter. What that means, is that I design the jewelry pieces in the computer and then I send the computer file to a laser-cutter to cut it out of the material that I’ve chosen. If you’re not familiar with laser-cutters, they basically look like a big copy machine, but instead of using ink or toner, a laser goes back and forth cutting out the material. Laser-cutters are expensive (anywhere from $2,000 for a cheapie model to over $10,000 for a really fancy one), so up to this point, I have been using an outside company to cut the pieces for my jewelry. I then assemble the lasered parts and make them into my earrings, necklaces and pins. The company I use is great, but like every company, they need to make a profit. That means that they charge fees for using their equipment and these fees aren’t cheap –44% of the cost of the average pair of earrings goes to the laser people. I’ve been spending so much on laser-cutting every year, that I could *almost* buy my own laser-cutter. The problem is, however, that to afford a laser-cutter, I’d need to save up thousands of dollars, but that’s hard to do when I’m spending so much on laser-cutting. So, it’s a bit of a catch-22. I can’t stop spending on my outside laser-cutting company until I get a laser-cutter of my own.
So the question becomes, how to pay for an expensive piece of equipment? I could, of course, get a loan to pay for the laser-cutting machine, but then I would be getting into a bunch of debt and I try to keep my business in the black. That’s why I decided to try a crowdfunding campaign to cover the cost of the laser-cutter I chose. That way, my supporters could all chip in a little for the machine and I would reward them with jewelry. For the total amount I chose to raise, I did not include expenses such as the cost of the rewards, or even the sales tax and shipping on the machine. I didn’t include those items because with most crowdfunding, it’s an all-or-nothing shot. You either make your goal, exceed it, or fail. I figured I wanted to hedge my bets and go for the lowest amount possible, which would essentially mean I would defray the cost of the laser-cutter versus completely pay for it. If the campaign goes over, then that’s more money to pay for sales tax, shipping and the cost of the rewards.
Why Ulule vs Kickstarter, et al?
Once I decided to fundraise for a laser-cutter, I had to choose a fundraising company. As I was researching, I found that the major players, such as Kickstarter and Indiegogo take about the same amount of cut of the proceeds. Success rates vary from year to year, but Kickstarter’s ranges between 35 to 43%. Not amazing, but decent. Indiegogo’s is worse – their success rate ranges from a horrifying 9 to 17%. Now Ulule is not really known in the US, but it’s actually the largest fundraising platform in Europe. Ulule’s campaign success rate is 65-74% and they attribute their very high success rate to the fact that they screen potential campaigners and that each campaign gets a personal coach to help them optimize their results.
The other thing that Ulule had going for it in my book is that it’s a B Corp. “B Corp” is short for Benefit Corporation and it means that the (for-profit) company undergoes regular assessments to ensure they meet standards in areas such as public transparency, legal accountability, and environmental and social responsibility. Basically, a B Corp means that a company isn’t strictly in it for the money – they want to do good as well. I prefer to do business with responsible companies, so the B Corp certification was the icing on the cake as far as deciding to go with Ulule.
As for my campaign, so far, I have raised just under $1500 with about three weeks to go, or about 1/3 of the way to $3995. I am really happy with all of the support I have gotten so far, but I must admit it is nerve-wracking. I am not a risk-taker by nature, so the all-or-nothing aspect of the campaign is difficult. However, I also think it’s important to get out of my comfort zone, so no matter what happens when it ends, I know that I’ll have learned a lot.
Have you supported my campaign yet? It ends on December 9, 2019 so don’t miss out! There are so many good rewards and they all ship in time for the holidays! Check it out here and let me know what you think in the comments!