There was a time when raising the initial funds to develop an innovative idea into a commercial product was an immensely painful process. Thanks to the internet and the concept of crowdfunding, life has become a bit easier for innovators and entrepreneurs. Crowdfunding is also compelling to venture capitalists, and it’s no wonder that many VC firms are turning to crowdfunding platforms to access new deal flow.
The crowdfunding industry has been growing rapidly and entrepreneurs in the robotics industry have already started getting a taste of success on various crowdfunding platforms like Kickstarter and Indiegogo. The majority of the successful robotic products coming out of the crowdfunding platforms are in the categories of 3D printers, drones, personal and telepresence robots, and modular robotic kits / edutainment robots.
Many experts consider 3D printing to be the Next Industrial Revolution. These technologies are transforming not just manufacturing, but many other fields including education, architecture, bioprinting, and even food printing. Started out of MIT in 2011, Formlabs successfully raised more than $2.9 million. Their first product, the Form1 3D printer, offers stereolithography in a smaller, more affordable desktop-class device. The stereolithography technique is usually available in larger, more expensive machines. Records are meant to be broken and in 2014, a Kickstarter campaign of the $299 Micro 3D printer proved that if the 3D printers are cheap enough, people will not waste a moment to seal the deal. Makers of the Micro 3D printer M3D raised more than $3 million from more than 11,800 backers. To get the price so low, M3D reduced the power consumption by a factor of 10 compared to professional 3D printers. Other notable 3D printers successfully coming out of crowdfunded platforms are FLUX-all-in-one, The Buccaneer, and RigidBot 3D, each raising more than $1 million.
With several millions of dollars invested in unmanned aerial vehicle (UAV) prototypes on various crowdfunding platforms, UAVs are clearly a desirable product category among hobbyists and tech-savvy adventurers. ZANO, touted as the world’s most sophisticated nano drone, and designed and developed for aerial photography and HD video capture, has more than 12,000 backers with $2.3 million in funding. PlexiDrone from DreamQii is not far behind the race; it received funding of more than $1.6 million. PlexiDrone has GPS follow-me and swarming capabilities. It has also obtained multiple Special Flight Operating Certificates (SFOCs), necessary for commercial flight. AirDog and Hexo+ from Helico Aerospace Industries and Squadrone System are also in the fray. Both of them have successfully raised more than $1.3 million.
When it comes to personal robots, the most successful offering is Jibo, a social tabletop family robot. It can also serve as a personal secretary, an educational assistant, a social media director, and more. Jibo raised an impressive $2.3 million funding based on an initial goal of just $100,000. Recently, makers of Jibo have closed a $25.3 million Series A round of funding.
Modular robotic kits / edutainment robots are popular on crowdsourcing platforms. This popularity is giving many ventures an opportunity to not only raise required funds, but at the same time it is providing them a bigger opportunity to engage deeply with the young users to make quick and smart changes. In 2010, a company called Modular Robotics introduced Cubelets, a system of robotic modules that could be magnetically connected together to build and program a robot. By the end of 2013, the same company used crowdfunding for its MOSS concept, which garnered three times more funding than the goal. Pitching a product through crowdfunding can be a valuable form of marketing. Romo, a smartphone robot from Romotive, is one of the prime examples of getting huge amount of attention, on social media and elsewhere, which helped them to grow beyond what the money raised alone could have done.
Crowdfunding is an excellent way for entrepreneurs to receive financing and exposure. Clearly, crowdfunding platforms are working very well for the consumer robotic ideas that are visible, finite, and easy to understand. But at the same time, the risk is that the idea could be copied somewhere else where cheap mass manufacturing is not a big deal. The idea that can’t reach its target customer through these platforms should be open through other channels. But, to be certain, crowdfunding proves the point that associated benefits bring success relatively faster.