Last year Misfit Wearables' activity monitoring device Shine met its goal of raising $100,000 on Indiegogo in less than 10 hours after launching on the crowdfunding site. Last week Misfit's two month campaign came to close with about $846,000 raised from almost 8,000 people from 64 countries and all 50 states.
All told, the company now has pre-orders for about 10,000 Shine devices, which it aims to ship "as soon as humanly possible" some time this spring, Misfit Co-founder Sonny Vu told MobiHealthNews. A new product from the Misfit team will also launch in this fall, Vu said.
The Shine activity tracker device is about the size of a couple of quarters stacked together. While it is waterproof, the all-aluminum device also has thousands of micro laser drilled holes on its surface that let LED lights to shine through. These act as the device's interface by illustrating the activity mode the device is currently tracking in with various LED configurations that represent running, swimming, or biking. Shine also uses a new form of wireless data transfer, because its solid aluminum build makes it nearly impossible to leverage common wireless transfer technologies like Bluetooth.
At an Indiegogo-hosted media breakfast held at CES in Las Vegas earlier this month, Vu and other startup co-founders who had successful campaigns through the crowdfunding site shared their experiences:
Vu said crowdfunding was completely contrary to Misfit's original plans for how to launch, which was to remain stealthy. Misfit was not going to bother announcing its first product until it was ready to buy within three days. Then, Vu said, his team read the book The Lean Startup (which he said made them the last company in Silicon Valley to read it) and they changed course. They chose to crowdfund the Shine because they wanted feedback as soon as possible.
"Will people actually pay for this device? Yes they are paying for other pedometers out there but we took some pretty bold design decisions..." Vu said. "We wanted to get validation before we spent 'x' number of dollars on marketing and manufacturing."
Vu said they ended up learning a lot including about price elasticity and a new business model.
"Almost all the companies in the Valley are praying for software [revenues], so they hope people will buy a device and then pay for a coach or some other kind of software. We learned [through our Indiegogo campaign] that people will buy hardware accessories. People will buy a leather strap or a necklace accessory."
Prior to the Indiegogo launch last year, Hadi El Heneidi, Misfit Wearables’ Commercial Lead told MobiHealthNews that Misfit decided to soft launch Shine through a crowdfunding platform because the company wanted the community’s blessing before committing to a full launch.
“We want to show that people want it,” El Heneidi said. “Crowdfunding is very different from focus groups where people can tell you they ‘might’ wear it. Crowdfunding sites like [Indiegogo] make is easy for people to learn about your product and actually have the opportunity to have the product, too. So by offering it early and at a strong pricepoint relative to what it will retail for — we think it will go well,” he said at the time.
Misfit had planned on launching the product through the better known crowdfunding site Kickstarter, but like many others working in digital health, the startup found Kickstarter to be unreceptive.
“Kickstarter prohibits all fitness, sports, health, and medical products across the board,” Vu told MobiHealthNews last year. “Despite the number of exceptions they’ve made, they wouldn’t bend the rules for us. Indiegogo on the other hand, embraced us with open arms… so the choice was fairly obvious. We made the decision [to go with Indiegogo], then the next morning we got the rejection [from Kickstarter] so it was meant to be.”
Even though Indiegogo is the lesser known crowdfunding platform, within its first 10 hours of going live the Shine campaign brought in 1,400 funders from 48 countries and all 50 states. Because it has a more open policy than its rivals, Indiegogo is likely better known now, two months after the Shine campaign first launched.
"We are OK with risk," Indiegogo Founder and CEO Slava Rubin said at the CES media breakfast earlier this month. "We absolutely, positively do not want to judge anything, we just want to be a utility," he said, "because the world has enough gatekeepers."
Rubin said that Indiegogo has actually never rejected anything, but it has taken some campaigns down -- almost always because they were illegal. The one take down that the company mulled over was a campaign that would give funders access to a CAD design file that would enable 3D printers to make a gun. From a risk-taking perspective, that is, of course, a very different line than Kickstarter's no fitness device policy.