Peter Cooper on Crowdfunding
Learn the secret of his success! Peter Cooper, software developer, author of Beginning Ruby, professional blogger & serial entrepreneur, talks about his very successful Kickstarter crowdfunding campaign for the Ruby 2.0 Walkthrough. [see full transcript]
Transcription of Interview with Peter Cooper [PC] and Julian Darley [JD] (with timings after the questions)
Intro: Welcome to the Ruthless Guide. I’m Julian Darley and my guest today is Peter Cooper, software developer, author of Beginning Ruby, professional blogger and serial entrepreneur and the topic for ruthless dissection today is crowdfunding.
JD: Can you describe the product you crowdfunded for? [0:20]
PC: I can try. It was basically a collection of videos for learning something that is relevant to computer programming. I previously had a product that I built entirely off my own bat, something called the Ruby 1.9 Walkthrough, [which] is a set of videos for people that use something called the Ruby programming language - it’s quite common. They want to learn how to move from one version to the other and they can learn how to do that [with the Walkthrough].
Ruby 2.0 is just around the corner so I decided to try crowdfunding, because it’s something I’m interested in but I’ve never actually tried, to help launch that.
JD: What finally tipped you over and made you decide to go for crowdfunding? [0:56]
PC: I think it’s because I am by nature a little bit experimental, so if I see something that seems to be going well I like to give it a go and see what I think of it. I’d been on the fence about this whole crowdfunding idea for quite some time - I actually had something which was a natural fit for it. It wasn’t a movie or a book, you know something along those lines, but something where I thought crowdfunding could work, and it does seem to have been the case.
JD: How did you come up with and develop your crowdfunding campaign story? [1:24]
PC: One thing that I always tend to do with work is that I look at what other people who’ve been successful are doing and I try to use that as a model to go against. I looked at other people’s stories and other people’s tiers and rewards and things like that [and] just tried to get a feel for what I think would work. I didn’t just have my story and thought how can I turn this into a crowd campaign, it was more that I’ve got this thing that I want to build, what is the best way of doing a crowdfunding campaign. I approached it from that and, kind of like how can I make this succeed, and then work back from that, rather than the other way around.
JD: How did you calculate what your goal should be, the amont? [2:00]
PC: I pretty much plucked it out of mid air. It’s not like many things - like an event or a book that has to get printed or something like that where I had to have a certain amount - it was really, if I put myself on the line and dedicated myself to producing this piece of work, what is the minimum amount that would keep me motivated and would be relevant. So if it was something like a £100 and I raised £100, I might not suddenly feel compelled to get it finished within the right amount of time, whereas I put the minimum at £4000 - that’s a kind of level where I really don’t want to refund £4000! So it would make me get the work done.
JD: That’s a novel approach. How did you decide how long to make your campaign? [2:40]
PC: I think this comes back to the modelling thing. I’ve seen campaigns dragging on for a long time, and it just seems to lose the momentum. Then of course doing it in seven days probably wouldn’t work either to get the word out. So I think I went with 21 days in the end. It seems quick enough to actually get people excited and actually putting their money on the line without waiting to see how it did, but also it was long enough so that I could spread the word using various blogs and newsletters that I own.
JD: Of course you have your blog, but did you make contact with more general media? [3:17]
PC: I didn’t, not at all. Because it’s my job to be involved with my own publications and I have quite a large audience that I can mention things to, a presence on twitter and social networks and things like that, I pretty much relied on that entirely. I know that Kickstarter cross-promotes your campaign if it’s reasonably successful - I think about 20% of the money came in through that approach. I didn’t have anything featured on the BBC or TechCrunch, or anything like that partly because it’s a very niche topic. This isn’t the sort of thing you’d expect to see there, it’s not cool like a movie or something that’s easily understandable like a regular book, it’s very technical and it has a very defined audience.
JD: How big is your blogging subscription? [4:02]
PC: The blog that I run, that’s in this Ruby programming space, has about 28,000 subscribers, but to be honest I’m mostly leaned on the mailing list that I have, because it has a much higher level of engagement and people are definitely reading it every single week: the number on that is about 16,000 or so, so that helped a lot.
JD: Were you ever concerned that you wouldn't make your target? [4:23]
PC: I wasn’t overly concerned, because as I said before, I picked a target that was reasonably good and would mean that I would actually get the job done, but because it was something that I suspected that I would commercially do anyway, I wasn’t too concerned, because I knew that perhaps even if I didn’t get it done on the tight timeframe I have set for the Kickstarter campaign, I would end up doing it several months down the line anyway, as I did with the previous Ruby 1.9 Walkthrough thing. So I didn’t have that concern, although of course that was that natural feeling once the campaign had started, it would be great to see if this finishes and goes over the mark, so there was that natural kind of thing, but unlike a lot of people it wasn’t like I had to have this campaign or that was it, game over, just that there would be a difference in the timing.
JD: How have you dealt with the perk/reward fulfilment matter? [5:10]
PC: Well, there were only a few different tiers that I had. I had a really high tier that was that I would give people a certain number of hours that they can talk with me on the phone, or perhaps put together contents for them, so a very personal level. But underneath that, are primarily videos, and things like that, that are very easy to deliver. But one of the problems I really had with dealing with the rewards was the whole logistics behind dealing with Kickstarter and handling the billing side of it and issuing invoices to people who wanted invoices and things like that. So I really had more logistical problems with the backend and the financial part of it rather than the actual delivery of the rewards, which is very easy, because I had email and the majority of the rewards will go out over email, so that part was very simple.
JD: Before launching your campaign, how long did you prepare for? [5:57]
PC: I think it was literally a matter of a few days. I already had the idea, and it was something I was going to do commercially anyway, but the idea of doing it as a campaign just kind of came to me: I thought I want to run a Kickstarter campaign sometime, see how it goes, and I think they had just launched Kickstarter in the UK a few weeks before that point, so I thought okay, let’s give this a go. It only took me a few days to sort out a video, and that’s one thing I found was quite important to have, from other campaigns I looked at: to record a video, explain what you want to do, what you want to achieve, what you will provide to people, what the goal is. I got that recorded, got it up, had to write the blurb to get people in, and that was pretty much it. So I was kind of ready to roll anyway, but it was just fitting in with the whole Kickstarter system to get it kicked off.
JD: Finally, Do you have any warnings or 'tough tips' for anyone starting out on their first crowdfunding campaign? [6:54]
PC: Yes. Other than the modelling thing, which I mentioned - looking at good campaigns and you try and think, how can I use some of the ideas they’ve got - the one thing that I did run into, that I alluded to before, is the accounting side of it and the financial side of it. You need to decide up front, are you doing this from a limited company that you own, or are you doing this as a sole trader - you need to think about the ramifications of that. But if you’re doing this as a person that actually has a normal day job, perhaps there’s something in your employment contract that means your company would own rights to this work on the side. Or perhaps you’re working as a sole trader, but you don’t know how to account for the tax, and things like that. I think you want to get a feel for stuff like that, rather than just go ahead, because if you run a successful campaign and you have let’s say £100,000 - not completely unheard of – turning up in a few weeks time, how are you going to deal with that? Are you suddenly going to find you need to register for VAT? Does any of that money that came in need to go back to the taxman? And suddenly you’re out of pocket. So you really need to take care of these things. It’s a very new area, not just for people to run these campaigns, but also for the taxman to deal with. So tread very carefully on that sort of stuff, because the taxman will bite you if you get it wrong.
Outro: Thank you Peter. That was Peter Cooper - software developer, author of Beginning Ruby, professional blogger and serial entrepreneur - on the Ruthless Guide discussing crowdfunding with me Julian Darley. Please sign up to ruthlessguide.com to hear news of more discussions and dissections.