There is a lot of buzz about the maker movement, the new industrial revolution and the democratization of design and production tools. Couple that with open source electronics platforms that are enabling the “internet of things” to communicate and react to each other, and a new manufacturing boom begins to take shape. It is indeed easier than ever to turn your idea for a new product into reality or at least make a beautiful, functioning prototype. But a successful prototype is among the first steps, not the final steps. Taking a product from concept to completion requires tenacity, a (measured) appetite for risk, and true business acumen. Even great business skills and a great idea don’t necessarily equate to a successful launch and a saleable product. But new ways of doing, making, and selling mean more ingenious ideas are getting a shot.
Bob Bean is a serial entrepreneur, a mechanical engineer and a software executive, but his true passion is playing his guitar. Bob loves making music and like any good entrepreneur he took note of all the things he wished he had available to him as a musician and created a new product (a platform technology) called Acoustic Stream. The idea was to connect musicians to their instruments wirelessly via mobile device. When inspiration hits, a musician can tap on his guitar to tell Acoustic Stream to start recording or activate precision tuning. When the temperature or humidity levels inside the instrument’s case change enough to put the instrument in danger, Acoustic Stream sends a notification to the owner’s mobile device.
Of course Bob thinks every musician needs an Acoustic Stream. But many an entrepreneur has spent their life savings advancing a product he fell in love with and thought everyone needed, only to learn the market for the product didn’t agree. Innovators must engage in market research, even informally, working with potential buyers to refine their designs: what will people buy? What will others demand of the product, what price would they be willing to pay? The true test for any product is whether or not people buy it and Acoustic Stream is testing the market and see if they will validate the demand for the product by pre-buying it on a website called KickStarter.
Five-year-old Kickstarter is an online platform for crowd funding, aimed at getting innovative ideas past the proof of concept stage and into full production. Not just products, but independent films, website launches, historical preservation projects, and even a fifty-foot electromechanical serpent got funded by those who wanted to see them succeed. Kickstarter provides a kind of distilled market research and venture capital process: a successful campaign will see a project funded by its potential users, often by pre-purchasing the soon-to-be-realized product. When a minimum threshold is reached, the project is made viable and the product can emerge from prototype to production. Kickstarter is almost 5 years old and its projects are maturing: 3 million people pledged a total of $480 million last year to Kickstarter projects; a Kickstarter-funded documentary won an Oscar; a product launched there snagged a coveted Superbowl commercial spot.
This critical market validation serves an important purpose to the new maker culture. No longer does an entrepreneur sink all of his personal finances into producing something few consumers would actually buy; instead, Kickstarter screens project proposals for transparency, protecting potential investors from scams, but only consumers screen projects for desirability by investing (or not). This inverted model is consistent with the radically democratized ethos of the maker movement, rewarding those who take a risk on a project with “rewards” for their confidence and contributions. Cultivating customer buy-in, building brand loyalty and amplifying a buzz of excitement no longer has to wait until a project hits shelves. Nor does a product need to compete for physical shelf space at all, since marketing and distribution can flow directly from creator to customer. What’s more, Kickstarter’s model minimizes the wasted capital – financial and mental – sunk into projects that may ultimately fail. Strong social media campaigns, flashy marketing materials, and good word-of-mouth will get many potential consumers to the Kickstarter page, but forcing consumers to front the cash to bring an idea to fruition edges the will-they-or-won’t-they question toward the middle of the development process, rather than the end.
Soon Bob will know if his instincts are right. Does the music world want Acoustic Stream?
