Kickstarter says only 44 percent of its crowdfunding campaigns are successful. Provo, Utah-based startup Prefundia claims it can boost that success rate to 71 percent for anyone who uses its web platform to test out their idea for several weeks before formally committing to a Kickstarter posting. How? By drumming up buzz.
"It's specifically designed to help Kickstarter projects acquire a mass following," says Prefundia co-founder Jeff Schwarting, "so when they do launch there, they can come in with momentum and rake it in on the first day."
Since launching its currently free service in summer 2013, Prefundia has assisted more than 500 crowdfunding projects. In look and feel, Prefundia mimics a Kickstarter page, except there's no request for cash: Startups post photos, video and text about their projects and--unlike with Kickstarter--can tweak them based on comments received. There's also a means for potential investors to sign up for e-mail alerts when the project officially launches on Kickstarter or another crowdfunding platform such as Indiegogo or Crowdtilt.
To better predict appropriate funding amounts, Prefundia is creating a benchmarking tool to track performance metrics for each project. Makers can use the tool to view the conversion rate for their projects compared to others' and to gauge the size of the market for their endeavors.
"From the research we've done on projects that do well, success is guaranteed when they spend a lot of time in the premarketing phase, gathering information and e-mails," Schwarting says. He sees Prefundia as a new and important part of that effort.
He admits that so far he doesn't see many investors cruising through Prefundia, but he does point out that visitor comments have helped creators improve their projects and raise their odds for crowdfunding success. One project that went back to the drawing board was the gStick mouse, a pen-shaped device for the mouse pad, which had raised $47,506 of its desired $57,000 on Kickstarter. The founder used Prefundia to gather a few hundred e-mails before a second try. The second time around, it hit its $40,000 goal on its first day and ended up with more than $130,000 in 15 days.
This year Prefundia expects to sign commission deals with manufacturing brokers, marketing firms and established crowdfunding sites, with the idea that the startups will graduate to the Kickstarters of the world and become real businesses in need of factories and sales and marketing help.
This should help keep Prefundia free to use and allow it to further develop its killer attribute--helping nascent ideas get off the ground. Schwarting, for one, already uses the site for this very reason. "I recently came up with an idea for a product but had no idea how to get it made," he says. "On my project's page, I asked if anyone knew who could manufacture it, and I quickly got a few good leads."
This story appears in the March 2014 issue of Entrepreneur. Subscribe »
