Build­ing a bet­ter brand through crowd­fund­ing

Cam­paign can dou­ble as a savvy mar­ket­ing tool


Jamil Kahn was a soft­ware de­vel­oper with no back­ground in the fashion in­dus­try when he came up with an idea for a new kind of parka that would have gloves, hat and scarf built right in.

“It was prompted by the in­con­ve­nience of hav­ing to shove my gloves and scarf in my coat all the time,” he says. “It just made sense to make them part of the coat. And the tech­nol­ogy is there to make it hap­pen, so why not?” The up­shot: in 2015, Kahn quit his job to con­cen­trate on his Smart Parka.

The ques­tion was how to fund it. Go­ing to a bank wasn’t an op­tion. “They want to see three years of cash flow,” he says.

While he could have at­tracted some an­gel in­vestors, Kahn opted to crowd­fund the ven­ture. For less than $1,500, he hired a videog­ra­pher and crafted a catchy video that showed some of his friends wear­ing the pro­to­type jack­ets.

Kahn’s launch be­came the most funded cam­paign ever run on Kick­starter Canada, rais­ing al­most $3.28 mil­lion to get his com­pany off the ground by pre-sell­ing the coats for about $300 each (they will re­tail for $600 to $750).

Even bet­ter, he cre­ated the kind of buzz that got him no­ticed by the na­tional — and even in­ter­na­tional — me­dia. And all those back­ers were po­ten­tial brand am­bas­sadors, show­ing the video to oth­ers and talk­ing up the prod­uct. “Kick­starter can turn a com­pany into a brand for zero dol­lars,” Kahn says.

Craig Asano, founder and ex­ec­u­tive di­rec­tor of the non-profit Na­tional Crowd­fund­ing As­so­ci­a­tion of Canada, agrees. Crowd­fund­ing can be “a tremen­dous mar­ket­ing plat­form for small busi­nesses and star­tups in par­tic­u­lar,” he says. “With crowd­fund­ing, you’re re­ally, in a sense, go­ing public, in that there are a lot of eye­balls track­ing you.”

While many small busi­nesses fly un­der the radar of con­ven­tional me- dia be­cause they don’t have big mar­ket­ing bud­gets, they of­ten have “an in­cred­i­ble story to tell,” says Asano, “and crowd­fund­ing al­lows jour­nal­ists to con­nect with them.”

It’s also a great way to as­sess risk by test­ing a new prod­uct or ser­vice be­fore a full launch. “It’s a chan­nel to your cus­tomers, who could be­come back­ers,” says Asano. “That is the best di­rect mar­ket­ing: there’s en­gage­ment and in­ter­ac­tion. Peo­ple can ask ques­tions of the founders.”

Cer­tainly, when Dave Mot­ter­shall man­aged to crowd fund $40,000 to launch his Toronto res­tau­rant Loka, it served as a ring­ing en­dorse­ment of his con­cept for an eatery that spe­cial­ized in lo­cally sourced, nose-to-tail cook­ing. But that wasn’t the end of the re­la­tion­ship. “We fin­ished the cam­paign last Au­gust and con­tin­ued to keep in con­tact with our Kick­starter sup­port­ers through that plat­form un­til we launched six months ago,” says Mot­ter­shall.

“We shared the ups and downs of look­ing for a lo­ca­tion as well as the ren­o­va­tion. Now we con­tinue to keep in touch through our so­cial­me­dia chan­nels.”

Those early sup­port­ers con­tinue to come, and they can see their names listed as they walk through the door of the res­tau­rant, which was named the best of 2015 by Now Mag­a­zine, as well as one of Toronto Life’s 20 best new restau­rants.

“In­ter­est­ingly, af­ter we opened, we dis­cov­ered ‘loka’ in Hindi means ‘peo­ple’,” says Mot­ter­shall. “With­out our peo­ple, Loka would not ex­ist.”

The Smart Parka grew from a pro­to­type to an es­tab­lished brand through the buzz of a Kick­starter cam­paign.

Jamil Kahn had an idea for a new kind of parka, one where the gloves, hat and scarf are built-in.

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