After successfully running two crowdfunding campaigns on Kickstarter, Navalayo Osembo aka Nava from Enda has learned a few things along the way. Enda is a Kenyan company that manufactures running shoes. The company run (pun intended) their first fundraising campaign in 2016 to launch their first shoe, the Iten. Their target was to raise $75K which they hit on the forth day of the campaign and were able to raise $128K by the end. Earlier this year, they run their second successful campaign on Kickstarter to launch their second running shoe, the Lapatet. Their target was to raise $80K and were able to raise $99K. Nava spoke to us about crowdfunding and their experience raising money this way.

PS: Enda is one of our amazing SHONA companies from our 2018b cohort!

What is Crowdfunding?

“Crowdfunding is a way of raising money online through crowdfunding platforms,” Nava said, “You can do it in different ways; people can contribute to your equity, buy your products or do a mix of both. The most predominant one is having a product and asking people to support you to either launch or improve it.

It is basically people coming together in support of your idea or project by either contributing small amounts of money as donations or by buying your product in advance so that you can have the capital to start.

Crowdfunding is basically people coming together in support of your idea or project by either contributing small amounts of money as donations or by buying your product in advance so that you can have the capital to start.

If this sounds a lot like Harambees (in Kenya) or fundraising drives for weddings and the like, it’s because it’s very similar. The only difference is that crowdfunding is done online while the harambees aren’t. 

Harambee is when people come together to help raise money for different reasons – weddings, funerals etc. They are essentially people coming together to contribute small amounts of money to achieve a big goal. So crowdfunding is taking a concept that has existed for a long time in our communities and putting it online. However, with crowdfunding platforms, you are able to reach much larger audiences and markets you probably wouldn’t have had access to.

Do you need to have an existing product to do this?

“It depends on the platform. The main ones are Kickstarter – where you should have a physical product or a prototype on hand, if you’re launching a product. However, there are other projects like movies that get fundraised for on this platform. There is also Indiegogo – they don’t have a high threshold and you can launch an idea that doesn’t exist yet. GoFundMe is usually affiliated with welfare and social projects.”

How do you start a Crowdfunding campaign?

“You create your crowdfunding page and submit it for approval. Ours was on Kickstarter. They check for different things to make sure you’re not duping people, particularly if you are launching a physical product. They might also give you some feedback on what type of material to use in your campaign like pictures etc. Once approved, you are ready to launch.”

Businesses at any stage of growth can fundraise on these crowdfunding platforms. It is less about stage of growth and more about the project you are fundraising for. 

Businesses at any stage of growth can fundraise on these crowdfunding platforms. It is less about stage of growth and more about the project you are fundraising for.

“You can’t just do it to fundraise for the normal operations of your business. It should be the launch of something new or a project with a start and an end that people can feel they contributed to helping you achieve. Something that has a purpose or an end goal.”

The decision to fundraise and launch their first shoe (the Iten) for the first time through a crowdfunding campaign wasn’t an easy one to make and they were split on whether to do it or not. 

“There were very strong sentiments not to launch a product that way because we feared that we might look unserious,” she said, “On the other hand, there was the opportunity of marketing our product through the campaign because on Kickstarter, we would reach a wide audience, including markets outside Kenya.”

They also needed the money and through Kickstarter, they would get it in advance without any strings attached. 

“You just need to present a solid idea and don’t need any security. This would allow us to get capital months in advance and that’s why we eventually decided to launch this way.”

How can the audience trust you enough to support you?

“This has more to do with your website, online presence and your story.” 

Enda were already established online on their social media platforms. They had also built a legitimate system that people could use to order online and they did their best to put as much information out there as they could. 

“It’s really all about transparency. Legitimacy comes from your presence and having other people talk about you. The fact that we also had media coverage was essential in helping us be more legitimate. For example when CNN featured us, we were immediately a lot more legitimate in the eyes of the audience.”

“It’s really all about transparency. Legitimacy comes from your presence and having other people talk about you.”

Enda’s campaign was also lucky to be identified by Kickstarter as a “Project We Love” – which is basically Kickstarter saying they support the identified project. They were featured on Kickstarter’s homepage for a day and this helped them get a lot of attention from the people on the platform looking for new ideas. Because they were successful at fundraising quickly through the Kickstarter campaign, they got a lot of media coverage. Therefore, launching through a crowdfunding platform really helped them do their initial marketing.

“There are different kinds of people on crowdfunding platforms – those that want to be the first to have something that no one else has – a lot of these will be on Kickstarter. Then there are those that genuinely want to support small ideas to grow and are looking out for people doing amazing things.”

According to Nava, the people on these crowdfunding platforms are also patient because most of these projects take a long time to deliver. For example, Enda made it clear to the people supporting their campaign that it would take about 6 to 7 months for them to deliver the shoes they were purchasing. As people buy products or support different projects, they aren’t expecting results tomorrow. 

“This is really important for an entrepreneur who is still trying to figure things out.”

 Any Licences Required to Fundraise on these platforms? 

You need to be registered in the US, UK or EU to be registered on Kickstarter. It worked for Enda because they have a US entity. This might be a challenge for other African businesses that aren’t registered in these markets. However, there are other options available for these businesses like Indiegogo, GoFundMe and others. 

Planning a Crowdfunding Campaign

To find people interested in what you’re doing (regardless of geographic location), you need to have a strategy on how to digitally get to them. Enda had a digital strategy that helped them plan for how and where to find these people, both online and in the different communities they were in.

“Figure out who the right audience is, where they are and the best mediums to reach them, then get them to commit. Also try to get as much media coverage to help keep the momentum,” she said, “In between, keep the engagement really high on social media and other platforms so that people can keep supporting you as you go along.”

Any Benefits of Fundraising this way?

“Getting the money in advance with no strings attached is the biggest advantage. You receive the money and just need to deliver on the promise you made. No interest to pay or security to deposit.”

How about the Risks involved?

It can be very disheartening to be unable to hit your target yet some of the things that happen are out of your control. Nava and her team expected their second fundraising campaign to be like the first which had a quick beginning with more people signing up to support them and a slow ending with less people participating. This wasn’t the case however, the second time round and they had more momentum at the end than at the beginning. In their second campaign, they managed to hit their target two days before the deadline.

“You have to be quick on your feet, to recognize what isn’t working and think of a better strategy,” she said, “The momentum was different for the two campaigns because in the first one, it was the first time everyone was hearing about us and there was excitement because of this. It was less so the second time around.” 

They kept their focus on being able to hit their targets in both cases, regardless of the momentum. To do this, they increased their social media engagement, wrote guest blogs and were featured on a podcast in order to cross pollinate audiences with other people. 

“We basically did a lot of things that would get us to new audiences that hadn’t heard about us.”

What they did well

“Ultimately it’s about traffic and conversion. How many people can you get to your site and how many can you get to convert.” 

How many people can you get to your site and how many can you get to convert?

They were successful at reaching different audiences, even did paid advertising in the second campaign. 

“We also got lucky because mid-campaign we had Lupita Nyongo (a Hollywood Actress) talking about us!”

Lessons Learned

Things don’t always go according to plan, even if you have done the same thing a number of times before. 

“The second time we run a campaign, we counted on having the same campaign we had the first time we launched. Even though we had a much larger crowd committing to support us the second time, it wasn’t a crowd that converted quickly.” 

The team learned that no matter what you do, always approach something new with a fresh perspective. While you might have some experience, don’t rely on it happening the exact same way it did previously. What if it doesn’t? What is your plan of action? Leave room for this. 

Their second campaign was much harder than the first with a couple of things not going according to plan. So they had to – in Nava’s words – “stop feeling sorry for themselves” and pivot quickly.

“We also learned that we can be quick on our feet and affirmed the teams’ abilities – the goal was met because of the people on the team and no one else.”

Would you do it again?

“We did it twice and I think right now, I wouldn’t do it again.” Nava said.

“You never know though, maybe we would and right now, I am still recovering from the exhaustion from the last Kickstarter campaign,” she quickly adds with a laugh. 

*Puppies and baby pandas to Nava for sharing this with us!