Crowd funding, sometimes called crowd sourcing, is a way to finance new projects. It allows you to post your idea on a website where people can find it and donate money to the project if they like what they see. The person posting the project details the procedure and states the amount of money needed to get the idea off the ground. As people donate money, the amount received by the project is shown as a percentage of the total needed. If the project gets less than 100% of its funding amount, then no money is taken from any of the sponsors. This makes it safe for people to pledge their financial support. The usual format is that the company with the idea will offer gifts in return for a person’s donation and the more a person donates, the bigger the gift.
There are lots of websites on the internet that offer this service, and some are more reliable than others. Furthermore, each of these websites has a set of specialised readers and followers. Depending on the site that you choose, the readers may or may not be interested in your idea. For example, one of the largest platforms in this area is a site called Kickstarter. It was started by a gaming enthusiast to fund his own idea. The platform is promoted as supporting all creative arts, but the site has an overwhelming number of gamers that regularly visit and support new gaming ideas. Some companies get as much as 150% of the funds needed. If you look at some other areas such as fashion, the ideas rarely get more than 20% of its funds needed. That means that all the money is returned and person who posted the project gets nothing. Below are some screenshots from Kickstarter taken on 29/11/2014
Kickstarter is not unique though. Looking through different crowd funding websites, you’ll find that fashion brands and ideas rarely get more than 30% of the amount needed to launch. Here’s what I think the problem is.
First, fashion is very personnel. Whether you like a fashion brand or not can depend on many different things, like fabric and styling. When a person views your project they can see these details, and if they don’t like something they’re not going to donate their money to it. Something as simple as using a colour that someone doesn’t like could put them off pledging, just like it would put them off buying it in a retail store.
Second, companies that usually do well on these types of crowd funding sites already have a following that they can ask to support them. In fact, they are usually looking to expand their already established brand, instead of create a new one. For most new brands in fashion or retail the first focus is always on creating a product, so it’s likely that the brand will not have anyone to promote their product to.
How to Get Your Fashion Brand Started
There are many ways to start your fashion brand on a budget. The key isn’t looking for the cheapest option, but to use your available finance in the right places and to build a solid foundation for your brand. Doing lots of research is also a good idea, and it can be done on the internet for free. You also need to work through your idea with an unemotional mind, and look at all of the options available to you on your budget based on your research. This can all be done on paper and doesn’t require any financial commitment. You will have to be honest and realistic. There is no point ignoring costs or options just because you are focused on your idea. If you think this might be difficult then ask a friend or someone you trust to look over your plans.
One you’ve done your research, one of the first things you should invest in is a customer profile. This will be a key document in creating the foundations for your brand, and will help you to save time and money later on. I’ve already written an excellent post about creating a customer profile, and you should check it out if you’re at this stage in your brand’s development.
You should also invest in some advice. Getting professionally created Tech Packs and manufacturing advice will help you to avoid very costly mistakes. If you hire a retail designer, they will also be able to tell you where you may be able to cut costs without reducing the design or aesthetic you are trying to achieve. You can read more about this in my article: Dressmaking Is Not Retail Standard. Finally, if you’ve learned something from this post, please take a second to use the buttons below to share it with others! Getting a fashion line off the ground doesn’t have to be nightmare, and we want to share that with the world.