Crowdfunding a Business - Regan Wann's Tea Shop Success
June
25,
2010
Crowdfunding a Business - Regan Wann's Tea Shop Success
1. How did your project come about? Why is this project important to you?
I've always been an "outside the box" (I hate that cliche, but haven't come up with anything better yet) money person. When I first opened my shop in 2008 I did an email and letter campaign, fully funding opening my business based on micro-loans of $1,000-$2,500 to be paid back over a 5 year period. People thought I was crazy but in this case crazy certainly seemed to work as I had the funding fully in hand within 2 weeks.
Anyway, that's not really what you asked. The project came about because, as small businesses will do, I quickly realized that my shop had a life of her own and she was GROWING. Small business owners need adaptability and, around the new year of 2010, I realized that I'd adapted all I could in the current space and simply needed more room: more room for events, more room for seating, more room for stock, more room for more tea!
This project is important to me because this shop is my heartbeat. When I opened I was coming out of doing a Master's degree in English Literature. As I was completing my degree my husband asked me "Well, what's next for you?" I think probably expecting me to talk about going on to a PhD or getting a teaching job or even going back to not-for-profit work. When I said, "I think I really want to run a shop full time" HE thought I was crazy for about 20 minutes, but once he realized I was serious he was more than 100% on board and supportive.
Opening the shop was such an organic process, things just seemed to fall into place like they were meant to be. This inspires me to know I'm on the right path for myself at this time and what can possibly be better than that? My little tea shop and the amazing people who support it are my heart and my soul. I know that sounds cheesy, but it's true. Growing my shop to serve these people and my community better is the most important piece of this for me right now.
2. How are you reaching out to your fans? How has the response been?
I'm a pretty active online networker, although I don't use everything I know I could. Facebook and LiveJournal have been my primary online resources for marketing my RocketHub campaign. I also have an extensive email list that I've used. Of course, being a bricks-and-mortar shop means I've also set up an in-shop option (I call that part the Fill-the-Pot campaign, using an actual teapot to collect contributions) which I send into RocketHub each weekend.
There have been a LOT of people who have found this entire process curious, so I spend a good amount of time explaining RocketHub and why I chose to raise my funds this way. Talking is a huge part of my business, so I expected this. Luckily. LOL!
The response has been good for the most part. There are a few people who think that a business taking about money is distateful, I get that, I suppose, but I also think it's a pretty outdated approach to business, especially super-small businesses like mine. Few people understand how hard it is to remain a viable super-small business right now: we have VERY little support, very few traditional options to acquire money, and a lot of people just don't have a clue how important they are to a super-small business especially in tough economic times.
Mostly, though, I've had people show a lot of support and positive curiousity about what I'm doing. I even managed to get an article in our local newspaper that mentioned RocketHub! For a small town that felt like a huge coup!
3. What has been like as a crowdfunding pioneer?
Am I a crowdfunding pioneer? Oh my gosh, I want a t-shirt that says that! ;0)
As I think I've probably already said in several ways, I just think it's SO important for creative folk and super-small business folk to push themselves to think differently about how we fund what we do. The world is ever-changing but more importantly the way money works in the world is changing and those of us that want to do our "thing" must find ways to change with it or we'll get lost in outdated concepts that don't work any more.
A lot of developing countries have opportunities for micro-funding. I know RocketHub is international, so I'm not sure how much this applies everywhere, but here in the US our banks simply aren't allowed to micro-fund! To move my business I don't need $50,000, I need $3,000, and where else can I turn for a small amount?
I just really love the entire concept. I love that it makes us, as the driving force behind our idea, responsible for pushing our campaigns into fruition. I love that it allows our fan-base to see how important they really are to us. I love the resources you guys provide and the "cred" our projects receive from being on a site with other funding and funded projects. I just wish I'd come up with the idea myself!
4. What advice would you give to a Creative looking to Crowdfund their project? What are the challenges they should be aware of - e.g. the "all or nothing" funding model?
Try to have a good handle on what you can reasonably expect to actually achieve. Sometimes that can be hard, I know, but if you know your fan-base and you know how skilled you are at getting them to respond to your needs that can help determine the best approach. It's definitely NOT fun to round the corner to the end of your campaign and realize you're not going to make it, which means not only did you not get EVERYTHING you needed, you're not getting ANYTHING.
All-or-nothing does put you in the position of primary responsibility for your fundraising. Personally, I see that as a good thing, but some people have the "if you build it they will come" mentality and that does NOT work with crowdfunding.
Oddly I think my biggest two challenges have been creativity in the reward system and keeping myself motivated to keep TALKING about my project.
On the first one, I wanted to make sure people felt they were getting something for their support and that for some of them the rewards would be enough to entice them out of their comfort zone and into doing a money transaction with an organization they may never have heard of before. At some point I realized that bonus rewards, special drawings, and other "extra" enticements worked and I needed to do more of those.
Which leads to issue #2, getting over feeling like you're spamming your fans, friends, and family to death. I have been talking about this project for - literally - over a month straight. Every single day I get on the computer and do SOMETHING: I blog about RocketHub, I thank people for contributing and publish it to my Facebook, I send an email, SOMETHING has to happen nearly every single day. Then there's the talking about it in the shop: trying to entice people to ask, reminding them that there's this cool online thing I'm doing, handing out the link, trying to get them to put something into the Fill-the-Pot campaign so I can move it to RocketHub. I only gave myself 45 days and if I don't make it I do not get a DIME, this thought has been ever-present and I use it to spur myself when my energy flags.
I have been lucky enough to have a friend (Melissa Maples) doing a RocketHub project at the same time, actually she started hers first and encouraged me to look at RocketHub when I started planning the move. Melissa has been a HUGE inspiration to me and not being "alone" when I got started helped me have the courage to really get going.
OH! And setting benchmarks has been HUGE for me! I nearly forgot. Sometimes the big picture is too big to be useful, so I have broken my campaign up into what feel like more managable chunks to me. I set myself a weekly goal every week and I also set myself a weekly approach. One week I was trying to get contributions at $50 or higher, so I did an extra reward for anyone who fueled at that level. Then another week I opted to "nickel and dime" for all those who don't have a lot to give, doing a special drawing at the end of the week for everyone who gave, even if they only gave a dollar. Letting my fans know that I'm trying to reach X-goal by the end of the week has actually done some interesting stuff among those folks, especially the ones who know each other.
People can read between the lines, so give yourself permission to be honest about how you feel about the campaign. It's challenging and you don't have to be 100% hunky-dory every single day. The great thing about RocketHub is that it's all on you so the only thing constraining you is...well...you! And you can so totally DO this!
Thank you Regan for being so open and so helpful - we are proud to have you as a RocketHub leader and pioneer.
-Vlad
