Danae Ringelmann, Co-Founder, Indiegogo

A Q&A with one of tech's most influential innovators

“And one of those early ones that stood out to me was a campaign raising money for Pastor Marrion, who was a man in the Congo saving people from execution by hiding them during the war. And two reporters who had been covering him quietly for years one day decided to do something when his kidneys. Rather than watching him die, they came to Indiegogo and raised about $50,000–enough to fly him to Nigeria and have surgery and get the treatment he needed. They saved his life. And all of this happened without us knowing him. That was early on for Indiegogo and, to me, was a huge moment that we were really building something sustainable and empowering to all people.”

When Danae Ringelmann and her co-founders, Eric Schell and Slava Rubin, launched Indiegogo in January of 2008, there was no such thing as crowdfunding. Well, there was, but no one knew it was called crowdfunding. “I just woke up one day and someone started calling us that,” Ringelmann told The New York Times in 2014. Fast forward to 2016 and people certainly know crowdfunding, Ringelmann and Indiegogo now.

In the past eight years, the crowdfunding platform zoomed to the apex of it’s fledgling industry, collecting accolades, heaps of venture capital backing and fuzzy success stories along the way. The list of laurels is vast. Indiegogo has been backed with more than $56 million in investments from a bevy of investors including Virgin’s Richard Branson, Tim Draper, and a veritable Who’s Who of Sand Hill Road. In 2010, Ringelmann was named Fast Company’s most influential woman in tech. Campaigns from more than 200 countries have been started. More than 15 million people visit the site every month. Not to mention, the growing list of crowdfunding copycats.

But all of that took time, setbacks and exorbitant amounts of work and effort. When Indiegogo was still in its infancy, Ringelmann was told it would take at least two years before they even knew if the idea and venture had the potential of working. “The two things we had to prove was that the internet was a mechanism to connect people and that people, consumers, customers, you and me would actually want to be part of the funding experience,” Ringelmann tells We See Genius.

When Ringelmann went to UC-Berkeley’s Haas School of Business for her MBA, it would not have been a surprise if she ended up on Wall Street. After graduating from UNC-Chapel Hill as a pre-med and American studies major in 2000, she spent four years at JP Morgan as an investment banking and private banking analyst. Then, she switched to equity research for Cowen & Co. in San Francisco, pumping out stock research on a diverse mix of media and entertainment companies from Disney to Viacom, for a couple of years. She went to business school not to further that career but rather, as she puts it, to leave finance to change finance.

After Ringelmann earned her MBA, instead of partaking in normal things that MBA do–getting a signing bonus, taking a weekend trip to Aspen, partaking in ritzy social gatherings–Ringelmann lived at home and borrowed money from her mother to get Indiegogo off the ground. And when her father–who was a big supporter and believer of Indiegogo–passed in October of 2008, Ringelmann nearly called it quits.

“Entrepreneurship is hard,” Ringelmann concedes. “Very rarely does anything go according to plan. There are highs and there are certainly lows and it is not a linear path.”

Indiegogo founders pictured from left to right, Slava Rubin, Danae Ringelmann & Eric Schell. Courtesy photo

Indiegogo founders pictured from left to right, Slava Rubin, Danae Ringelmann & Eric Schell. Courtesy photo

THE LIFE-SAVING INDIEGOGO CAMPAIGN

But then in 2011, something game-changing and significant happened across the globe: A life was saved through an Indiegogo campaign. In 2003, Pastor Marrion P’Udongo, dubbed the “Oskar Schindler of the Congo,” housed over 70 Hemas in his living room as a group of “gunboys” from the rival Lendu tribe, executed other Hemas in the street. Eventually the Lendu militia–comprised mainly by boys younger than 16 years old–found Pastor Marrion and the 70 Hemas. The entire group including Pastor Marrion, his wife and daughter, were marched into the street to be executed when a lieutenant from the militia recognized Pastor Marrion. He had been a member of the Pastor’s congregation. The Lieutenant pleaded with his commander to not kill any of the group. Miraculously, the group was not only spared, the militia escorted them to a United Nations refuge.

As the war escalated, Pastor Marrion used his home as a lighthouse and safe space for fleeing Congolese. In 2011, Pastor Marrion’s kidneys failed leaving him in need of tens of thousands of dollars to fly to Kenya to receive a transplant. Two journalists, who’d been secretly reporting on his heroics for years were faced with the decision to essentially watch him die or raise the $50,000 necessary to fly Pastor Marrion to Nairobi for a transplant. When they did the latter, everything changed for Ringelmann.

“That was early on for Indiegogo and, to me, was a huge moment that we were really building something sustainable and empowering to all people,” she says.

THE $3.5 MILLION-BACKED CAT EAR HEADPHONES

Indiegogo, which was created as an alternative to traditional money-raising efforts, was no longer just a way for small business owners and entrepreneurs to get projects off the ground. People were using it for real, serious and potentially life threatening emergencies.

Of course, others are using it for less serious, yet still interesting ideas. Probably the most recently notable example is the Axent Wear Cat Ear Headphones. Created by two UC-Berkeley alums, Wenqing Yan and Victoria Hu, the headphones are shaped like cat ears and allow users to share music. The duo asked for $250,000 to prototype the product. Amazingly, the team raised nearly $3.5 million. Indiegogo then connected them to Brookstone and within two years of drawing up the idea, the cat ear headphones were a best seller for Brookstone last holiday season.

Afterwards, Ringelmann and team asked a group of venture capitalists if they would have ever considered investing $3 million in this specific team and product. “They said, ‘No explicative way,'” Ringelmann laughs. “The traditional system would have failed them. But when they had the tool to connect directly with their audiences, they were successful. And that’s how it should be. That’s what Indiegogo stands for.”

‘WE BELIEVE EVERY IDEA IS WORTH A SHOT’

And that’s precisely what keeps Ringelmann motivated through the daily grind–giving everyone a fair chance to realize a dream or idea.

“Indiegogo is existing to change how ideas come to life–to make it far more merit-based, democratic, fair, efficient–to give everyone a shot,” says Ringelmann, 37, now chief development officer for Indiegogo. “We believe every idea is worth a shot. People deserve a fair path to bring their ideas to life, and that there is so much beauty in the world when that happens.”

In a wide-ranging interview with WeSeeGenius, Ringelmann gives her best advice on entrepreneurship, explores the lessons she’s learned from eight years of growing Indiegogo, speaks in-depth about her platform’s most memorable campaigns and reveals the four Ps (people, passion, participation and perks) in running a successful Indiegogo initiative.

 

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The one word that comes top of mind immediately is a ton of gratitude. Gratitude to the team at Indiegogo that has been working relentlessly and hard for the last eight years to pioneer this new industry. Gratitude to all of our customers–especially the early customers for taking a leap of faith and giving Indiegogo a chance to prove to them how we can help them.

When Indiegogo began the word crowdfunding didn’t exist. So we weren’t a cheaper, faster or better version of something–we were a whole new way of bringing ideas to life. And that required a lot of trust and faith on behalf of our customers, who themselves were trying to bring their own ideas to life. They were in it working hard to figure out what was going to connect them with their audiences and engage with their fans and customers–they were working hard to iterate and innovate. So them choosing us to help them do that was an honor and, to this day, I’m just incredibly grateful and thankful that we had all that faith and trust in the early days as well as the hard work, persistence and perseverance of our team to continue building and innovating and trying things and pushing the industry forward. And basically, carving out a whole new way to bring ideas to life, which is what our mission is: To unite people around the things that matter to them and bring those ideas to life.

My first biggest lesson is do whatever you can to ask yourself why you’re starting a business. And with that answer, ask yourself why again and why again and then why again–kind of like a two-year-old. Get to a point where the only answer you have is just a fundamental belief. It’s almost irrational but I say that because your reasons for starting a business or solving a problem need to be that deep-rooted. And I think especially for social innovators and social entrepreneurs, be really honest with yourself about what problem you’re solving, why it’s so important that it’s solved and why you personally care so much about it.

I say that because entrepreneurship is hard. Very rarely does anything go according to plan. There are highs and there are certainly lows and it is not a linear path. And what gets you through it all is this obsession with your ‘why’ and your obsession with solving the problem because it is something that is core to you. That is what I have learned about Indiegogo. Even when I’m frustrated or feeling down or having a tough day, I go back to our customers. I go back to my teammates who are working really hard and pushing themselves and have incredible highs and lows themselves. And I remember that we are doing this for a really massive reason. Indiegogo is existing to change how ideas come to life–to make it far more merit-based, democratic, fair, efficient–to give everyone a shot. We believe every idea is worth a shot, people deserve a fair path to bring their ideas to life, and that there is so much beauty in the world when that happens. Having strong core beliefs in your solution to the problem turns obstacles into inconveniences and no’s into yes’s. It’s a powerful tool.

The other lesson I’ve learned is to ask yourself what motivates you to come to work everyday while you’re working on this. Answering that question for us is what turned into our values today. And those values play a very important role in creating the culture that we want and need for Indiegogo to be successful. We did a lot of work with that up front and we’re continually revisiting our values and making sure the behaviors that embody those values are what they need to be in order to be successful.

In doing that work, it helps inform not only who you hire in terms of what skill sets, experiences and perspectives they have, which you surely want a diversity of to be successful–especially if you’re in a company that’s innovating something completely new. But, what you don’t want a diversity of is your values. Because people who are aligned with the mission and aligned to how they work with one another, but also have the diversity of skills, experiences and perspectives, that is the recipe for innovation and engagement–people feeling really good at work. When two people work with completely different styles, which means they have different values when it comes to work, they end up spending more time trying to figure out how to work together than actually getting anything done. For us, it’s authenticity, collaboration and empowerment–those are our values–and we hire for that, we reinforce that, we reward that. It’s definitely been a catalyst for helping us find great talent as well as setting them up for success. And setting them up for success sets Indiegogo up for success. It’s a work in progress–it’s not perfect yet–but it’s always going to be that way.

The third piece of advice is get out of your head. Listen. Get into the world. Listen to feedback, listen to customers, watch customers use your product or service. Basically accept everything you think you know is just an assumption and constantly be testing that. You have to be really humble. And you have to be super empathetic. When we talk about entrepreneurship, things like perseverance, fearlessness, commitment, grit and irrational commitment to your goals, those are the words that come up a lot for what makes a successful entrepreneur. And those I for sure agree with. But the flip side of that, which I think is equally important is extreme empathy. And I don’t think that empathy gets enough recognition for how important it is to be successful at bringing an idea to life or creating something that doesn’t exist and making it exist. Because if you don’t listen to your customers and really understand their needs, pain points and frustrations, then you’re going to craft something that doesn’t actually work.

There is a lot of research that shows constraint enables activity and action, which at first might seem counterintuitive. But I think that concept makes complete sense. And a great example of that concept in action is when a company has a really strong mission. When you have that strong ‘why’ and that strong mission, it becomes a filter, bumper lane, or constraint, to help say ‘yes’ and ‘no’ to things.

I think the hardest part in the early days of this company was when someone said to us, ‘You won’t really know if you’re onto something meaningful for at least two years.’ And I think for us it took three years, actually, to really know if we were hitting a nerve. We knew the pain point of inefficient access to capital and all the challenges in starting companies and businesses and launching creative ideas. It’s hard. We started with the biggest pain point of all, which is funding. It took two to three years to really see if our solution, which was less about the product and features and functionality, it was more the concept of leveraging the internet and leveraging the new world of social media to allow people to connect with like-minded folks–their audiences and customers–and empower the people to actually fund ideas.

The two things we had to prove was that the internet was a mechanism to connect people and that people, consumers, customers, you and me would actually want to be part of the funding experience. Because historically, we’d been locked out of that experience. Depending upon the industry, only certain financial institutions, foundations that give grants, banks or venture capitalists were allowed to fund. And that is where we saw the inefficiencies. When you’re reliant on a third party to say ‘yes’ or ‘no’ to an idea, that seemed pretty inefficient when you could just go straight to your customers. We thought, if you go right to them, wouldn’t that be a lot more efficient and a lot more empowering and a lot more effective and fair? So then the ideas that come out are the ones that people actually want–not the ones that just two or three people want. And it took us at least two years to get there.

So the advice is there are so many directions we could have gone and our mission and values of creating an open, inclusive platform became this constraint. The last thing we wanted to do was become a gatekeeper to funds ourselves because that was the model we were trying to undo. And we got a lot of pressure, for example, to say we should pick and chose who comes out of our platform because then you can control it more and pick the people who are going to be really successful and that will make us look good. We got all of this feedback from the world in terms of people’s opinions on how we should test our idea, but having our ‘why’ and mission around openness and inclusivity answered the question for us. We can’t pick and choose who’s on our platform.

And this was incredibly powerful when we started to get competition around us that weren’t using these approaches and were against what we stood for. It was clarifying having that strong mission and core values and principles that helped us say ‘no’ to the things we needed to say no to and ‘yes’ to the things we needed to say yes to. It doesn’t answer every single question–you have to make a ton of decisions as an entrepreneur but at least it gives you that gut check filter you need.

Yeah, there are some every week now–every day almost. When you look at the diversity of campaigns on the site, it just shows you how much creativity, energy and inventiveness people across the world have. And until Indiegogo came around, all of those ideas were going unborn. There were ways to get them off the ground, but it was a very old, archaic, inefficient process. Given that, many ideas never made it through and we’ll never know how many medications never got invented or how many small businesses never got off the ground. There are so many tinkerers and inventors out there that have stuff in their heads.

The only reason Edison got off the ground was because he happened to meet a guy named J.P. Morgan who basically backed him. Think about all of the Edison’s in history that we’ll never know about–who are just as talented, just as innovative. I just learned that Mozart’s sister was more talented than him at the piano–but very few people know that because she wasn’t in an environment that allowed her talents to thrive. We will never know how many creative entrepreneurial minds didn’t have the opportunity to rise to their potential because of the lack of infrastructure and system to make ideas come to life in a merit-based way. And now we have Indiegogo and we’re changing that.

In the early days, we knew every single campaign owner and we were talking to them every day, giving them tips and telling them what to do to get their business off the ground. Some of the most impactful campaigns in the early days were the ones that worked. Then there were the ones that we didn’t know and they just happened on their own. To us, that was a testament that we’re building something truly democratic because we didn’t even need to talk to the campaigner. There was no human interaction that needed to happen. They can just use our platform and tools to connect with their audiences.

And one of those early ones that stood out to me was a campaign raising money for Pastor Marrion, who was a man in the Congo saving people from execution by hiding them during the war. And two reporters who had been covering him quietly for years one day decided to do something when his kidneys. Rather than watching him die, they came to Indiegogo and raised about $50,000–enough to fly him to Kenya and have surgery and get the treatment he needed. They saved his life. And all of this happened without us knowing him. That was early on for Indiegogo and, to me, was a huge moment that we were really building something sustainable and empowering to all people.

I love it when the underdogs win. Recently there have been some campaigns that traditionally, people would call crazy, and then they totally prove those people wrong. They find their niche audience and are wildly successful. I’m thinking about the cat ear headphones that came out of Berkeley, of course. They came up with this cool, crazy, quirky design for headphones that also allowed you to share your music with friends. Super quirky. They came to Indiegogo looking to raise $200,000 to $300,000 and $3 million later, they clearly found their market, realized they were on to something and then we connected them to Brookstone. And then they were one of the bestsellers at Brookstone this past holiday season. They went from literally concept to reality in less than two years. And these are first-time entrepreneurs and normally people would probably judge them. They are two young women in college. They have a lot of “biases” potentially stacked against them. We even asked some venture capitalists if they have put $3 million into these two young women’s idea before they even had a prototype. And they said, ‘no expletive way.’ The traditional system would have failed them. But when they had the tool to connect directly with their audiences, they were successful. And that’s how it should be. That’s what Indiegogo stands for.

And there have been a lot of things around Indiegogo being a real-time way to deal with some emergencies and problems that come up. This one woman launched a campaign to raise $2,500 to basically collect baby carriers and bring them over to Syria because she was so distraught by the picture of the young boy that washed ashore a few months ago trying to flee with his family. She thought she had to do something and this was something she could do. She thought, ‘I’m a mom, I have baby carriers. I know other mom’s that have baby carriers.’ She saw all of these images and videos of families walking miles and miles and miles carrying their children and decided that’s what she could do. So she came to Indiegogo and ended up raising over $150,000 because this was something other people could do. Indiegogo was a way to activate action and just let people be part of the solution very easily and quickly and in a way that completely aligns with what matters to them. And it’s not just liking something or sharing something, which is important, but it’s actually allowing them to take action and be part of a solution, which often requires money.

And then the Girl Scouts of America, I mean, that was an amazing example. They raised $100,000 from a rich donor but the one requirement was they weren’t allowed to serve transgender girls. And so the Girl Scouts of America said, ‘Thanks, but no thanks. That’s not what we stand for.’ They gave the money back but they needed that money because they have programs to fund. So they came to Indiegogo and they ended up raising $300,000. And Indiegogo allowed them to stand by their values and be who they were and true to what mattered to them and connect with other people in the world that shared those same values. And gave those other people the opportunity to take action and be a part of the solution. And that’s what motivated me still to this day.

First of all, the way define success, I think, is different from how people who have had their own interactions with crowdfunding define it. For me and Indiegogo, success is giving people a shot at their idea. Some people learn that their idea really resonates with the world and they raise enough money to move forward with their project. And some people learn that their idea doesn’t resonate with the world–they don’t really have customers or fans out there. So they learn they need to go back to the drawing table and re-work the idea and come back again. We see that a lot. People “fail” at getting money but are successful at learning a ton and coming back and doing it again. Or they might wait a little longer and change directions because they’ll realize what they thought was a great idea actually wasn’t or they didn’t have the right strategy, messaging, offering or solution. But you will learn. There’s always positive ROI in terms of learning.

In terms of people who are successful at raising money, first, their idea does resonate with an audience–that’s a great way to validate an idea. Another piece is not only talking about your ‘what’ but also your ‘why’ or putting in a video. Campaigns with a video raise an average of four times more than campaigns without a video. Campaigns with a team raise more than campaigns without a team. Campaigns that do updates raise 251% more than campaigns that don’t do any updates. So basically, keep your audience engaged, talk about your why, show yourself–don’t just make it an advertisement.

We have found people fund for four reasons. Three of the reasons are a little more altruistic or social in nature and the fourth is a little more selfish or self-serving in nature. We call them the Four P’s, which are people, passion, participation and perks. First, people are funding ideas because they want to support the people in campaign. Or they are really passionate about the project and they think it’s really cool and that the thing needs to exist in the world. And the third is participation, which is they want to be part of it. They want to be part of the solution. The fourth ‘P’ is perks. That is more wanting the thing, the thank you note or the trip–or whatever it is the campaigner is offering. What I think is powerful about Indiegogo is when people fund, they are getting both–feeling good about what they are doing because they are taking action aligned with their values and they are supporting people but they are also getting something back in return. So it’s this awesome combination of the two motivations at play. Those are some tips, and again, it goes back to being authentic and not talking just about your ‘what’ but also your ‘why’.

There was some research that just came out that found campaigns that use more positive language and are more expressive do better. And because of that, they also found women tend to do those things more and that is maybe why women are more successful at raising money on Indiegogo than men. But whether you’re a man or a woman, just be yourself, be authentic, when you talk about your ‘what’ and your ‘why’, be positive.

Folks who don’t do as well, it kind of goes back to if your idea doesn’t resonate, that’s one thing. But also, some campaigns don’t raise a lot of money more because people don’t put any effort into it. People just post it and walk away. If you were to open a fruit stand and just walked away and didn’t tell anyone about it, didn’t offer some really yummy fruit and didn’t have conversations with the people walking up to your fruit stand, you’re not going to be as successful. Some people think of an Indiegogo campaign as more of an advertisement that people are going to show up out of nowhere. And they’re not going to do as well.