When Indiegogo co-founder Slava Rubin was 12, his father fell ill with myeloma, a rare form of plasma cancer. Within three years, he was gone.
Fast forward a couple of decades and Rubin, a native of Minsk, Belarus, and a graduate of the University of Pennsylvania, started a charity fundraiser for cancer research called “Music Against Myeloma.” But Rubin was frustrated with the fundraising. Two of his classmates at UC Berkeley’s Haas School of Business, Danae Ringelmann and Eric Schell, had similar feelings and together, they wanted to change that landscape.
In fact, Ringelmann had already conceived of a fundraising endeavor before the term “crowdfund” was in use. Rubin and Schell convinced her to take it online before Kickstart became not only a verb, but their competitor.
“We saw gatekeepers in traditional finance, [such as] banks, VCs, etcetera, constantly turning people with great ideas down because of pre-existing biases,” Rubin told The Times of Israel. “We decided to create a platform where the crowd decides what gets funded.”
That decision led to the creation in 2008 of Indiegogo, the first online crowdfunding platform.
The company’s business model has proven wildly successful. Since it was launched, Indiegogo has supported more than 600,000 campaigns and raised more than $850 million globally. (For comparison’s sake, since the launch of competitor Kickstarter in April 2009, the company reports that 11 million people have backed a project, $2.3 billion has been pledged, and 102,710 projects have been successfully funded.)
“More people want to be entrepreneurial than we thought, they just need the opportunity to make it happen,” Rubin says. “Seeing amazing ideas get funded every day has only intensified my commitment to making sure any idea gets a shot at success.”
Indiegogo has seen to fruition a wide range of satisfying projects, he says, such as Help the Haleys Have a Baby, which raised more than $8,000 for a couple struggling with fertility treatments, and Emmy’s Organics, which yielded more than $15,000 for the makers of gluten-free, vegan and raw foods.
Other campaigns have included Solar Roadways, which raised $2.27 for solar-powered panels that can melt snow and cut greenhouse emissions, and more than $445,000 for Cuddle and Kind, knit dolls whose sales provide meals for hungry children in partnership with the World Food Program USA and the Children’s Hunger Fund.
In the world of crowdfunding, says Rubin, there is also no shortage of eccentricity. Natural tonic for hangovers Before Elixir took in more than $14,000, while Bug-a-Salt, a shotgun that uses salt to exterminate insects, raised more than $500,000.
And Rubin, who identifies with Conservative Judaism, pointed to KosherSwitch as an innovation that helps observant Jews keep the Sabbath. The patented technology allows users, who can’t turn lights on and off on Shabbat, to control electricity. The product, which is endorsed by some leading rabbis, raised more than $70,000 and is now available for retail purchase on Amazon.
Over time, Indiegogo has witnessed several methods emerge in these and other campaigns as the most effective and efficient ways to leverage fundraising via the Internet.
‘We have actually found that the most effective campaigns are run by teams, have great videos and post regular updates’
“We have actually found that the most effective campaigns are run by teams, have great videos and post regular updates,” Rubin says. “In crowdfunding, backers really become part of the team, and they want to feel it.”
As crowdfunding continues to gain traction, some observers argue it is on track to surpass venture capital in 2016. But that hasn’t kept Indiegogo away from VC. In fact, it has raised more than $55 million in venture capital.
Rubin, who recently transitioned from CEO to chief business officer, shared his thoughts with The Times of Israel.
How does Indiegogo stack up against the competition?
We are completely open and global, which is different from any competitor. We also have the best customer service in the business, and unique features like our API (application programming interface) and Shipping Now products. We also recently launched Enterprise Crowdfunding to help large companies scale and source innovation, and Generosity.com to fundraise for personal causes, which is free of platform fees.
What are your priorities as CBO?
I’ll be focusing on new growth areas and like partnerships and new markets: equity crowdfunding, China, retail partnerships.
What has this endeavor revealed about the dynamics of crowdfunding?
We’ve learned that campaigners which communicate openly, often, and with a positive tone, will raise more. We’ve also found that teams do much better than single people.
What has it revealed to you about your own priorities in business, innovation and the arts?
I love data, but I also love to explore and experiment. So as Indiegogo has grown, I’ve learned to use data to direct our experimentation to constantly make the product better for our customers, which is ultimately my main priority.
I love seeing people get the chance to express themselves in ways that they couldn’t without crowdfunding. Even incredibly successful films like “Super Troopers” come to Indiegogo, because by using crowdfunding they don’t have to relinquish creative control.