The Year of the Crowd is in full swing; crowdfunding is taking off in 2013. While some industries are tapping into the crowd #momo with full force, others, like fashion, need to pull up their proverbial socks. The time has come for fashion designers and enthusiasts alike to start crowding the runway and funding designers of the future.
What is crowdfunding?
Crowdfunding is a collaborative funding process where individuals/entrepreneurs can raise funding for their projects/businesses from their networks through online platforms. Project creators make a short video and launch their project online, and project backers (the crowd) each donate different amounts of money until the project is funded. What started off as small experiment in 2009 with Kickstarter has now become a red-hot industry with an expected transaction volume of $5.1 Billion in 2013.
How is crowdfunding relevant to the fashion industry?
Crowdfunding is helping to move capital to the industries that need it most, and fashion is definitely at the top of that list right now. With the industry in need of a radical shift, crowdfunding can spur a new generation of fashion designers and help democratize the way clothes are created.
What’s happening right now?
Fashion designers and next-generation brands from all over the world are beginning to experiment with crowdfunding as a way to bring their new clothing lines to life.
Here are three examples of how clothing designers are starting to crowd the runway:
Wowcracy went of its stealth mode on Sunday and opened up the site to start accepting projects. The Italian-based entity has been promo’ing their launch since late 2012, and it looks like the veil is about to be lifted on the crowdfunding portal that promises to bring ‘Endless Fashion Week’ to its collaborators.
Wowcracy will function using what’s known as the ‘pre-buy model,’ where project backers can collaborate to help bring new collections to life. Essentially, backers will pledge to pre-buy the garment or accessory of their choice, and if the entire campaign is funded (all or nothing) then they will (technically) donate the money to the designer and receive the specified garment when the collection is finished.
Expect to see live projects on Wowcracy in the coming weeks.
Kickstarter is the original crowdfunding platform that sparked the global crowdfunding movement in 2009. After having helped project creators raise millions of dollars globally, the platform is now being used by fashion designers in selected countries (US and UK) to help get new collections off the ground.
One duo in New York recently decided to launch a crowdfunding campaign for their sustainable line of activewear, made using Merino wool.
To create Opus Fresh and start re-defining adventurewear, they were hoping to raise $15,000 USD over the 90 day time period. Well as you can see, they have blown that target out of the water and raised more than 300% of their original goal; and they still have a month and a half to go!
Kickstarter is built to help get projects like this off the ground. While it’s not strictly a fashion-focused funding portal, like Wowcracy, it is another great option for aspiring fashion designers to bring their ideas to life.
Everlane is a US-based fashion retailer committed to shaking out the middleman and helping bring fashion back to its roots. When the company was thinking about how to approach the Canadian market, one of the engineers in the company came up with the idea to crowdfund their market entry to see if the demand was there. And so the #CrowdFundCanada campaign was born.
So the company created their own branded crowdfunding campaign with the goal of raising $100,000 to break into the Canadian market.
And they succeeded! By raising $118,000 through their #CrowdFundCanada campaign, Everlane showed that not only can crowdfunding be used to get off the ground, but also to enter new markets.
We talked about this strategy last year, in our Building Blocks for the #NewEraBiz series.
Everlane is the best example we have seen of actually executing this strategy, showing how brands can use the collective crowd power to their advantage to blaze new trails and enter new markets.
Overall, the time to crowd the runway has come. With an abundance of creative talent and a shortage of capital, crowdfunding can help connect the dots between aspiring designers and would-be backers. Suit up for a spring full of crowdfunded fashion!
Are you excited to crowdfund fashion projects?
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