FundYou has been our first client. Before the founding of Codistan our CTO, Monis, has been employed with FundYou and has built the Crowdfunding platform from scratch by himself. Since then Codistan has been maintaining the platform.
FundYou was founded in 2016 by Anders Lindberg. During the first year Monis has built the platform and the FundYou team has run several first crowdfunding campaigns. While maintaining the platform, we noticed that little qualified feedback reached us from the operative side and that the platform did not gain more than MVP status. Anders was very busy with his main professional career, leaving him little capacity to advance the FundYou platform after the initial starting period. In early 2019 we suggested developing the platform further. While building new features, Johannes Bohren is developing the business side.
The project started with a research of the crowdfunding ecosystem in Finland, the Nordics and beyond in order to define a strategy for Fundyou: Crowdfunding experienced a hype about a decade ago. Many platforms competed with different service levels and features for campaigns and the innovation level was high. This innovation persisted, when it comes to equity crowdfunding, where we have a range of platforms offering innovative services. Also banks and other solvent players are crowding this market and campaigns tend to raise higher sums. At the same time a market consolidation has happened in reward-based crowdfunding. The major players nowadays are Indiegogo and Kickstarter, leaving only space for small niche players. In Finland there is one local platform and other international platforms focus on niches like social entrepreneurs, music projects a.o.
We have defined three main components, which allow FundYou to find its niche and eventually compete with incumbents.
1– Service level and quality of the campaigns
The large american platforms focus on scalability. Their business model is to attract as many campaigns as possible, without offering much support. They offer great material in FAQ sections about how crowdfunding works in general, but otherwise their consulting services are basically non-existent. Hence, the platforms are crowded with bad and fraudulent campaigns. Well functioning campaigns either have staff, which understands crowdfunding or they rely on external consultants specialized on crowdfunding. So, by evaluating the campaigns, before allowing them start a campaign, we make sure that legitimate entrepreneurs are behind the campaign and that the chances to reach the funding goal are realistic. At the same time we can help entrepreneurs with their marketing strategy, the design of the rewards and the general funding and sales strategy.
2- Marketing Services
Well functioning campaigns usually have to invest funds into additional marketing products. Besides social media marketing these products push the campaign page of the platform. Often this results in the fact that the startup’s website has to compete with their crowdfunding profile for years after the campaign ended. We defined and developed features that allow a more sustainable marketing strategy. So if a campaign chooses to purchase additional marketing service, we integrate the campaign into the project’s website and market it from there. Additional tools are in production.
It is a common understanding that reward-based crowdfunding works mainly for projects or companies having a B2C focus. The basic idea is, that you can sell your product before it even exists and use the raised revenue/capital to invest into the production of the product. Such products usually need to have certain characteristics, in order to qualify. When it comes to B2B startups, it is recommended to pursue only an equity funding strategy. We want to challenge that theory.
We are developing and testing new features and services aiming to create the first reward-based crowdfunding platform, where companies purchase services and products. We can therefore provide startups more independence and a funding strategy, which is more focused on clients/customers rather than investors of any kind.
While starting with the development of new features, we focused on the business side to get first pilot projects on board. In December 2019 a set of four diverse campaigns went live. Our objective is to steadily grow the number of campaigns, while developing new products supporting our strategy. While having staffed a proper development team including some digital marketing resources in our office in Pakistan, we provide consulting and business development from Finland. Initially our business developer was the only operative resource of FundYou in Finland; Since December the FundYou team is growing again with first team members not provided by Codistan.