As a fundraising platform, crowdfunding is still fairly new. Yet, it's helped launch million-dollar businesses nearly as often as traditional investment channels since it’s inception.
Crowdfunding has also given many side projects a fighting chance, when no one else would. Many startups that originally launched on crowdfunding platforms have gone on to build $100 million businesses from the funds (and pre-orders) they received on platforms like Kickstarter and Indiegogo.
Here are some of those side projects, the entrepreneurs behind them, and what did they to find success with crowdfunding.
1. Oculus Virtual Reality Headset
Since Oculus was purchased by Facebook for $2 billion in 2014, it has become one of the most successful companies to have initially launched on Kickstarter.
Palmer Luckey started Oculus Rift as a side project from his parents' garage. He had been experimenting with virtual reality since he was 15 and attending community college. Then, he continued developing the VR headset as a side project while he worked as an engineer at USC’s Mixed Reality lab. During that time, he started the Kickstarter campaign.
The 2012 Kickstarter campaign far surpassed the $250,000 goal and raised a total of $2.4 million. When the product was still in its prototype stage in 2014, Facebook acquired it for $2 billion in cash and stock. Palmer succeeded largely because he invented something that held major long-term opportunities—in terms of technological advancement that companies like Google, Sony, and Samsung were rushing to create themselves.
2. Pebble Wearable Devices
Pebble was able to raise over $10 million from nearly 69,000 backers on Kickstarter, smashing its $100,000 goal early on the first day of the campaign. The company has gone on to generate sustained success from this initial product launch, creating numerous wearables that quicken the current trend toward Internet of Things (IoT) connected devices.
The idea for Pebble and ensuing fundraising effort started as just a side project in Erick Migicovsky’s dorm room while on a study abroad program through the University of Waterloo. While some students partied in their spare time, Migicovsky developed Pebble as a side hustle and posted it to Kickstarter. The rest is history.
3. SkyBell Video Doorbell
SkyBell raised $600,000 in a 30-day campaign on Indiegogo for their smart video doorbell, which sends live video of a homeowner’s front door to their smartphone. As such, the business ranks as one of the most successful crowdfunded companies of all time.
Their campaign, led by co-founder Andrew Thomas, was one of the earliest examples of incredible success in crowdfunding. Most wouldn’t realize it now, but Andrew was working full-time as a marketing consultant when he launched the Indiegogo campaign for SkyBell with his cofounder on the side.
All their hard work paid off. Within the first few days of the campaign, SkyBell was featured on Engadget and TechCrunch. Since then, their doorbell has become one of the most popular smart home products on the market and they work with companies like Honeywell.
4. Tile App Locator for Missing Stuff
Tile was born out of the idea that a Bluetooth-connected device could help people locate their easily misplaced items such as keys, phone, and any other items that are linked to it. Although the founders of the company met while both working full-time jobs in Santa Barbara, they shortly left their jobs and took the leap of faith to work on Tile.
Within 24 hours of their campaign going live on Kickstarter, it exceeded the $200,000 funding goal. Before it finished, the company had raised a total of $2.6 million.
The founders worked hard to get the word out about the campaign, leveraging social media, high-quality video content, and cold emailing writers to drum up press that’d fuel the funding growth. Now, it's a thriving technology company with a portfolio of products that consumers have fallen in love with.
5. Bragi Wireless Headphones
Bragi raised $3.4 million during its crowdfunding campaign that helped the startup become the multi-million dollar business it is today. While the founder had previously created a number of successful products, he learned that not every product is as easy to develop in massive quantities—even one that he thought was as straightforward as headphones.
In fact, Nikolaj Hviid was working this idea as a side project from his position as the CEO of a design agency. He needed the funds from the campaign to fund further work on product development.
The biggest lesson Hviid learned was around the flexibility needed to take a product from concept to prototype and then mass production in a way that’s financially feasible for manufacturing. The time Hviid had during the crowdfunding campaign was spent working directly with potential customers that could tell him exactly what they wanted from a pair of headphones that others weren’t delivering.
Crowdfunding can generate publicity that helps you get noticed by large groups of consumers. Bigger brands have also come to realize that crowdfunded startups can be ripe territory for growing their own product portfolios through partnerships and acquisitions.
Most importantly with crowdfunding, you can develop your great ideas into successful campaigns, and if you’re lucky—eventually a profitable business while working or attending school. These founders prove that anything is possible with smart work, creativity, and commitment.
