Megan Jones

Megan is an EU-funded intern at Technoport working on communications and Share the Problem. Before joining the Technport team she worked in conservation research and environmental communications in the UK and US.

Crowdfunding interview
15Megan Jones

Megan JonesMarch 13, 2014

Technoport 2014: Liz Wald explains international crowdfunding

At the end of April innovators, entrepreneurs, business leaders and other technology pioneers will gather in Trondheim for Technoport 2014. In the run up to this exciting event, we will publish a series of interviews with our speakers to learn more about how they are driving innovation. This week we hear from Liz Wald, Head of International at crowdfunding website Indiegogo

How would you explain Indiegogo to someone not familiar with crowdfunding?

Crowdfunding is the process of raising money from a large number of people to fund the projects that matter to them, resulting in significantly more funds and awareness than would ever be possible through a single contribution. As with Indiegogo, this primarily happens online, where money is exchanged, often for an item called a “perk” in a way similar to other online marketplaces like eBay, Airbnb and others. 

There is no approval process for campaigns on Indiegogo (unlike other platforms, like Kickstarter). Why is that?
We welcome a diversity of campaigns spanning creative, cause-related and entrepreneurial projects. This gives campaign owners and contributors the chance to fund what they care about most, without restrictions.  We don’t think we should judge who should raise funds for their idea, but rather the crowd should choose to fund or not based on their interests.

In keeping with the company’s mission to democratize funding, it’s important for Indiegogo to remain an open platform. With no application process or waiting period associated with launching a campaign, individuals can start raising funds immediately, without delays or bottlenecks. Further, we do not curate, which means that we, as a third-party, don’t arbitrarily define the value of any campaign on behalf of the campaign owner.

What, in your view, are the hallmarks of a successful technology crowdfunding campaign? What are some examples of innovative projects?
Beyond raising money, crowdfunding provides several benefits for individuals and organizations. First, a crowdfunding campaign creates a unique opportunity for market validation and increased access to social networks, amplifying overall awareness as like-minded people continue to visit and share your campaign. Second, entrepreneurs can receive early customer feedback, giving them an advantage as they refine their service or product. Third, those who crowdfund gain access to emails and data analytics, providing crucial insights as they move forward once the campaign is over.  This is as true for a creative campaign as a tech-focused one.

One great example is the wireless activity tracker called Misfit Shine.  In addition to raising close to $850,000 from nearly 8,000 backers, they got invaluable feedback on their product design and as a result of the campaign launched both a necklace and a bracelet as well as their original clip-on product. This kind of customer feedback would be nearly impossible if just one or a handful of investors had backed the company.  Even better, they finished their campaign with a great database of users, plenty of funds to create their product, and the proof of concept needed to then take their idea to investors if they chose to do so.

There are campaigners and contributors from nearly 200 countries on Indiegogo. Do you find that certain types of projects are more popular in different countries or regions?
Indiegogo doesn’t focus on any particular category. Below are a few examples of categories of campaigns on the platform:
– Film
– Web/Video
– Music
– Gaming
– Design
– Small Business
– Community
– Health
– Education

Interestingly we’ve seen a pretty solid mix from all corners of the earth.  While hi-tech projects might be obvious in places like the US, Germany and Israel, we see them from less expected locations as well.  We also see amazing innovations from places like Rwanda where a solar phone charger is more a necessity than a novel idea.  The bottom line is that creativity and ingenuity exist everywhere.

Indiegogo currently accepts and disburses funds in USD, CAD, EUR, AUD, and GBP. Do you foresee it accepting Norwegian kroner anytime soon?  
We’re consistently improving our platform to better meet the needs of our international customers and will continue to offer more global payment options as we move forward.  Whether it’s the krone or yen that comes next, the important thing is that we continue to give people options both for raising funds and for making it easy for contributors to participate.

Want to hear more?

Liz will feature at our Venture Angels and Crowd Investors event at Technoport 2014. She will elaborate on the topics explored in this interview as we shed light on the future of funding new ventures. Learn more about Technoport 2014.

Crowdfunding-piggie-bank
15Megan Jones

Megan JonesMarch 11, 2014

Crowdfunding and Tax – what are the rules?

If you’re an innovator wanting to crowdfund a product, or even if you’ve just given money to a crowdfunding campaign, there’s something you might not have considered: tax.

Crowdfunding might seem like a quick and easy way to fund your dream project, but don’t let the hype fool you. Raising enough money takes time and effort, and if the campaign is successful you will probably have to pay tax on the money you receive – and charge VAT on the rewards you give.

Taxable Profit
Money raised through crowdfunding is income. If you are raising that money for profit, then you will have to pay income tax (for individuals, sole traders and partnerships) or corporation tax (for limited companies). If you are not raising it for profit – maybe you want to hold a block party on your street, or raise disaster relief money for earthquake victims – you will have to prove that you are not making a profit in order to avoid tax.

“Whether crowdfunding income is taxable to the recipient depends not on the type of financing, but on the purpose of financing,” explains Ståle Lorås, Partner at Norwegian auditing firm BDO.

“According to the Norwegian Taxation Act, income from business is liable to tax. It must therefore be determined whether the activity financed is part of a business, or whether the recipient is a tax-exempt institution. This involves undertaking a concrete assessment of the conditions in each individual case. If the conditions of a business are met, the income will be liable to tax.

“What type of activity is being financed through crowdfunding will be a decisive factor in determining tax liability. If the recipient is running a taxable economic activity, the funds raised for this purpose will be counted as taxable income.”

Skatteetaten, the Norwegian tax authority, has also written a helpful two-pager (in Norwegian) explaining how crowdfunded profit fits into existing tax rules.

VAT
In reward-based crowdfunding campaigners give donators rewards in exchange for pledged money. This is essentially pre-paying for a product or service. In the eyes of Norwegian tax law this is a sale, just as much as if you were exchanging goods directly – and even if the market value is less than the investment. Therefore, VAT must be collected on these products or services.

A t-shirt, a 3Doodler, or a dinner with the founders would all fall under the standard VAT rate of 25%. If the donation amount were 1000 NOK, for example, 200 NOK would be taken as VAT. A book, on the other hand, is a “zero-rated supply”, so no VAT is collected.

Remember too that VAT is not charged on purchases made from outside of Norway – so if 50% of your funds come from pledgers in the USA, that money is VAT-free. (But it’s still taxed as income.) In Norway, business must also be VAT registered if their annual turnover is above 50,000 NOK, or 140,000 NOK for non-profit organisations.

A note on equity crowdfunding
In the case of equity crowdfunding, investors fund start-ups or small businesses in exchange for partial ownership (shares). There is no tax charged on selling shares, because the money received is not counted income. This doesn’t mean equity crowdfunding is simple – as this list of possible pitfalls shows.

In a nutshell: if you are crowdfunding a commercial product or service in Norway, be prepared to deduct income tax and VAT from your earnings.

This article does not constitute tax advice. If you are crowdfunding a business, we recommend seeking assistance from a tax professional. 

Image credit: The CrowdFunding Consultant

Motorbike HIGH RES
15Megan Jones

Megan JonesMarch 5, 2014

Crowdfunding Success Stories – 3Doodler

A couple of months ago we talked about some of the most exciting tech to come out of the Consumer Electronics Show in Las Vegas. One of those products was the 3Doodler, whose Kickstarter campaign in early 2013 smashed its target within days.

We thought the 3Doodler sounded so cool that we’ll be having a 3Doodler scribe at some of the sessions at Technoport 2014. In advance of that, we asked the 3Doodler creators to reflect on their crowdfunding success and share some insights.

What lead you to try crowdfunding for the 3Doodler?
All three co-founders have been users of CF sites for some time. Between us we have backed well over twenty projects in the past few years, and at the Artisan’s Asylum, where we work, we have been able to witness other CF projects from inception to execution. We knew that CF, particularly on Kickstarter, would offer a great platform to garner interest in the 3Doodler, test the concept, market to potential consumers, and create a vibrant and supportive community. It also came with the benefits of having all mechanisms, such as payment processing and community management in place.

Your Kickstarter project was almost an overnight success. Did that bring unexpected consequences?
We were prepared in the sense that we had the resources to cope with the emails and media attention. We also had a concrete sense of the goals and budgets of our project before going on Kickstarter, and before putting 3Doodler into the public eye.  That said, the pace of emails and messaged (each of which we committed to respond to) caught us off guard, with thousands coming in a day at one stage. That’s when having a flexible team, and a friend or two to lend a hand can really help.

Would you do crowdfunding again, or would you look to more traditional investors in the future?
Yes, absolutely we would, crowdfunding worked very well for us the first time around. The whole Kickstarter experience was a very positive one for us – we were able to get some fantastic feedback from backers and the community. And that’s why we would do it again – the fact that we get to build a community before 3Doodler had even hit the stores was awesome.

What are your thoughts on equity crowdfunding?
It’s great for feedback and getting your project off the ground, but you just need to be careful and make sure you have resources to cope with the emails and media attention. Make sure that you have a concrete sense of the goals and budgets of your project before going on Kickstarter, since you’re putting it into public eye. Crowdfunding not only allowed us to be financially independent and get proof of concept early on, it also allowed us to build a community out of the gate.

What does the future hold for 3D printing and the 3Doodler?
Tools such as the 3Doodler represent a new medium in 3D expression. This gets you closer to being able to take an image or idea from your mind and render it as a physical object in reality. If you can envision an object you can now create it. And it will facilitate the ability for us to communicate our ideas and visions to one another.

Finally, any tips for product designers considering a crowdfunding campaign?
Prepare, take your time, get it right – make sure your idea’s great, and you have the right people to launch it. The exercise of asking all the right questions up front makes the plan much easier. Don’t ask questions too late! The moment you have launched it’s very hard to correct planning mistakes.

Also, be responsive: Every backer is a key ally. They were there first. Reply to their messages, hear their comments, give them respect. They stick by your side if they do and they’ll let others know. Good communication is also a sign that you are on top of things and can execute. But at the same time, stick to your plan and keep the backer audience in perspective, you can’t change your whole app on the feedback of a few. Keep it balanced.

Image credit: 3Doodler

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15Megan Jones

Megan JonesFebruary 27, 2014

10 Exciting Crowdfunded… Foods

Cows, crickets or coconut ice cream? With food at the heart of many global challenges, from climate change to soil loss, this week we bring you 10 crowdfunding innovations you can actually eat.

1. Goodio Cools

Image: FundedByMe

The Finnish food company Goodio already makes chocolate, but they know that even in cold countries people want ice cream. With a successful equity campaign on FundedByMe, they are now getting ready to launch a dairy-free, organic ice cream made from coconuts. They promise it in four flavours – vanilla, chocolate, strawberry and mint – so stay tuned on their Facebook page for future delectation.

2. Beer52

Image: Beer52

What could be more popular than a crowdfunding campaign where the supporters get rewarded in beer? With this Scottish craft beer club, Beer52, beer-lovers can subscribe to receive monthly boxes of craft beers from around the UK. Small, local breweries get national distribution and word-of-mouth advertising, consumers get to try new products, innovators collaborate, and the world becomes merrier and slightly more intoxicated.

3. Flavourly

Image: DollyBakes

Monthly food sampling must be the next big thing, because another new start-up, Flavourly, reached its crowdfunding target within 24 hours. The equity campaign only launched on Angels Den two weeks ago, and the founders have already had to introduce a stretch goal.

Like Beer52, Flavourly is a subscription service in the UK that allows customers to discover new craft beers every month – but this time packages also include fine foods and snacks.

4. Exo

Image: edible startups

If you’ve ever been grossed out by a bug-eating contest, you might not be so excited about the UN’s recent recommendation that we should all be eating insects. On the other hand, innovators like the guys from Exo think insect protein might be more palatable without the “ick factor” of crunchy legs.

Exo protein bars are made from ground up cricket flour and other, tastier ingredients like chocolate. Eating crickets could help overcome the global food crisis, since they need much less food and water than, say, cows, have much lower GHG emissions, and reproduce faster. They also have more iron and high calcium content.

Thanks to a successful Kickstarter campaign, you can now pre-order your very own Exo bars. And let’s be honest – they’ve got to taste better than stink bugs.

5. Koopeenkoe

Image: New Scientist

Cut to the chase and get straight to the heart of things with the Dutch scheme Koopeenkoe, where customers buy beef directly from the source. The best part? A cow isn’t slaughtered until every part of it has been sold, minimising waste and maximising freshness. The cows are raised on a mostly organic diet and outside most of the time, and customers get to eat locally. The website is in Dutch, but this article explains the process in English.

6. Foodie Dice

Image: WIRED

Finally, a legitimate excuse to “play with your food”. This Kickstarter project spices up an ordinary cooking experience with an element of chance. To play, role six Foodie Dice, see what ingredients land face-up, and use all or some of them to make your meal more creative. The basic pack includes nine dice: protein, cooking method, grain/carb, herb, bonus ingredient, plus spring, summer, autumn, and winter vegetables. The bonus pack includes a wild card, spices, dessert and vegetarian protein. This campaign only finished in November, but you can already order your own Foodie Dice on the website.

7. Pizza Rossa

Image: Wikipedia

The award for best start-up of 2013 – at least on Crowdcube – goes to Pizza Rossa, a new fast-food restaurant hitting the streets of London later this year. Their campaign also beat records for largest amount of equity funding raised in the UK. Unlike Italy or New York, good pizza by the slice has apparently been hard to find in Britain – but not for much longer.

8. inSpiral Kale Chips

Image: inSpiral

Bye-bye fatty potato crisps, hello guilt-free kale chips. Wildly popular in US health food circles, this superfood is becoming increasingly mainstream in Europe. The start-up inSpiral markets their kale chips as a raw food, vegan, gluten-free, additive free, organic snack – salty, flavourful, and still good for you.

Thanks to their Crowdcube campaign, these Inspiral kale chips are now cheaper, more widely available, and sold in a 100% compostable packaging. Check out their inspir(al)ing crowdfunding pitch on Youtube.

9. Soylent

Image: Soylent

If you see cooking as a hassle you may find new happiness in Soylent, a food replacement that claims to “free your body” from food. Whether Soylent makes eating pleasurable is debatable, and some nutritionists are dubious about its health benefits. Still in its experimental phase, if more widely accepted Soylent may also help ease global hunger and malnutrition. In the meantime, its new nutrition label sheds some light on its many health-giving ingredients.

One thing is certain: Soylent’s crowdfunding campaign has been a massive success, raising around $2 million. The product should be available for wider consumption in spring 2014.

10. FundaFeast

Image: GoFundMe

Like 4D printing, crowdfunding perpetuates itself. Through GoFundMe, individuals can raise cash for their own personal projects – in this case, FundaFeast. One of the first dedicated food crowdfunding sites, FundaFeast went live on February 1st and may mark the beginning of a increase in more specialised crowdfunding platforms than the Kickstarter and Indiegogo giants.

Other food crowdfunding (foodfunding?) platforms – mostly US-based – include Credibles, where customers support local food business in exchange for credit, and Foodstart, raising money for restaurants and food trucks.

 

All of these projects sound delicious, but where are the Norwegians? If you know of a Norwegian crowdfunded food scheme, we want to hear about it!

FluorescentTobacco
15Megan Jones

Megan JonesFebruary 17, 2014

10 Exciting Crowdfunded… Gadgets

With crowdfunding, anyone can help turn the craziest of dreams into a fully functional reality. From the innovative to the sustainable to the just plain wacky, these 10 successful campaigns give a taste of the great new tech coming out of crowdfunding.

1. WakaWaka Light and Power

WakaWaka Power

Image: WakaWaka

This lamp is solar powered and super efficient, lasting for up to 80 hours. It can stand up on its own or attached to a bottle top. The WakaWaka Power, released in 2013, can also be used to charge a smartphone, MP3 player or tablet.

Even better, the profits from sales in the West are used to give WakaWakas to some of the 1.2 billion people without access to electricity. Replacing kerosene lamps with solar light cuts down on CO2 emissions, reduces health problems like burns, and saves families money. That makes WakaWakas a win-win!

These nifty gadgets have had three crowdfunding campaigns – Kickstart and Symbid for the WakaWaka Light, and again on Kickstarter for WakaWaka Power. Or you can check out the website to buy the gadget yourself.

2. Glowing Plant

Image: WIRED

The boundaries between technology and nature are sometimes hard to define. No more so than with this crowdfunding project, which caused quite a stir last summer when campaigners offered to give away free glowing plants to their Kickstarter backers.

The project seeks to develop sustainable, natural lighting by genetically modifying plants to glow in the dark – but its wild popularity comes from its wacky, science fiction appeal.

The founders describe their crowdfunding success as an exciting new development for synthetic biology, but critics worry about the environmental risks when GMOs are freely distributed. In the wake of this controversy Kickstarter has banned GMOs as rewards, alongside guns and alcohol. Interested people in the US can still pre-order glow-in-the-dark seeds or plants on the Glowing Plant website, but distribution to Europe is illegal under EU law.

3. Wood. Head. Phones.

Image: Inhabitat

Except for the wire inside them, these headphones are made entirely of wood. The inventor, a 19-year-old product designer from Oslo, named them after the Norwegian word “treskalle” – literally meaning “wood head”, or “stupid” – because, as he says in his crowdfunding video, “this is, in a lot of ways, a stupid product”.

In spite of this modesty, the headphones supposedly have a sweet sound and are custom-made for each person in ash, oak, cherry, or walnut. It’s not clear if you can still buy your own Wood. Head. Phones., but the Facebook page is a good place to start looking.

4. Kano

Image: Kano

If you’ve ever wanted the satisfaction of building your own computer, then look no further than Kano. For geeks and newbies of all ages, this cool kit comes with 11 components – including how-to guides – and is cute enough to give mainstream laptops a run for their money.

With Kano you can make games and learn code, and it’s open source, so using it can only get more fun. The smash hit Kickstarter campaign raised 15 times the original goal, and you can find out more or pre-order your own at the Kano website.

5. Morpher

Image: Indiegogo

Do you use a helmet when you cycle? Many people don’t, and this British inventor thinks he’s found one reason why: helmets are too bulky, especially for people using a bike rental scheme. The solution? A folding helmet.

Morpher folds in half, making it easy to slip it into a rucksack or laptop bag. It should be as safe as an ordinary helmet – most of the crowdfunded money will be used to meet international safety standards – and even comes in pretty colours. Check out the Indiegogo campaign or Morpher website for more info.

6. BUILD

Image: Indiegogo

Tired of boring furniture? Well, designers in Germany have developed modular shelving that is non-toxic, long lasting and completely recyclable. Beneath its funky shape lies a high-tech structure of polypropylene plastic foam that also makes it lightweight and shock-absorbent.

With BUILD you decide what shape you want, and can put it on a wall or use it to divide up a room. Plus if you move house or need an extra few chairs for that big dinner party, each block doubles up as a box, a seat, or even a cooler. Check out the Indiegogo crowdfunding campaign, or go straight for the product.

7. ThePresent

Image: thepresent

OMMMMMMMMM.

Relaxed yet? No? Well maybe it’s time to welcome ThePresent into your life. Its New York inventor touts this as the first 365-day clock – in one year the hand only rotates once around the face. With its colourful display to evoke the changing seasons, this clock is a reminder to stop and smell the roses.

The Kickstarter campaign has a great video about how the clock was made. Check out ThePresent website to learn more or get your own.

8. JACK

Image: autoevolution

Between walking and cycling lies a third choice for the eco-friendly commuter: the electric, folding scooter. JACK, as this Dutch prototype is called, weighs less than 20kg, can be charged in a car or home, and fits easily in a car boot or on public transport.

JACK can travel at speeds up to 25kph (15mph), but with a full battery it only lasts 20k (12.5 miles) so it’s more suited to a city spin than a road trip. All the specs are on the Symbid campaign page or the JACK website.

9. Tellspec

Image: Tellspec

If you’re human, you’ve probably worried about what’s in your food at least once. Does that apple have pesticides on it? Are there nasty additives in my pre-packaged sandwich? How many calories are in that slice of cake?

Tellspec hopes to answer these questions. Through spectrometry, Tellspec uses a laser to scan the chemicals inside a piece of food, and then wirelessly sends the results to your smartphone. For anyone with a food allergy, watching their weight or just keen on good food, this is definitely a product to watch. The Indiegogo campaign finished in November, so stay tuned on the website for launch as early as August.

10. Emotiv Insight

Image: Kickstarter

It’s not a jetpack, but it comes pretty close. The Emotiv Insight will allow you to move objects with your mind. With previous models, people have used their thoughts to create music, drive a car, manipulate a robot, type on a keyboard, and operate a wheelchair. This new model, crowdfunded on Kickstart, should also be able to record emotions, stress levels, physical fitness and facial expressions.

Emotiv Insight works through electroencephalography (EEG) to interpret the neuron signals  in the user’s brain. To make it more accessible, designers are making this gadget lightweight and cheaper, and adding dry sensors (so you don’t need to smear gel on your head every time you use it). Whether it’s helping people recover from injury, manage a disability, or just try out something awesome, this gadget screams “watch out, world”.

 

Is there a gadget we’ve left out? Which one would you choose?