According to Canoe & Kayak, crowdfunding through websites like Kickstarter and Indiegogo are allowing new boatbuilders to bypass traditional finance sources like banks. The magazine reports that kayak builders in the US are relying on social financing methods to bring new products to market.
"Crowdfunding has some real advantages for a new product line or brand," Joe Pulliam, a former banker and founder of Dagger Kayaks, told the publication. "From a marketing standpoint, Kickstarter, Indiegogo and the like reach an audience that more traditional marketing methods used by kayak companies may never reach. So crowdfunding can really help jump-start a model or brand that's a bit out of the norm."
Kickstarter has seen three new campaigns come online in the last two months, including a new fish kayak through Blue Sky Boatworks, the Rogue-lite series from startup Kokopelli; and a 14ft packable kayak from PakaYak. For the PakaYak product, 497 backers pledged US$546,000 to fund the project. Trak also used Kickstarter to launch its new carbon-fiber TRAK 2.0, and Oru Kayaks recently listed its new Coast XT kayak on Indiegogo as its third crowdfunded boat. The magazine reported that Trak’s Kickstarter campaign earned about US$650,000 in pledged support.
“It will help carry us into 2018 by adding such innovations as adjustable rocker on the fly, polyurethane hull and deck, and fabric welding," Nolin Veillard, Trak founder, told the magazine.
Pulliam says that crowdfunding can help determine the success of a new brand or product. It can also help raise cash in a short time for design and tooling. Some campaigns, he said, do well, while others gain little interest through crowdfunding sources. Swell Watercraft fell short of its fundraising goal on the 14ft Scupper, so the project was put on hold.
“With crowdfunding, you're paid before you ever make the first one, so there’s a huge advantage cash flow-wise,” Pulliam told the magazine. “With the seasonality and low margins in the kayak business, cash flow is always a big challenge, and crowdfunding, while it introduces new challenges, provides a new source of working capital."
A company called Oru, which has held multiple crowdsourcing campaigns, views it as integral to its business plan. “Oru was originally launched on Kickstarter, and since then we’ve built a great community of people who care about our brand through our various crowdfunding campaigns,” chief commercial officer Roberto Gutierrez told the publication. “We’ve seen massive support from our existing community with each crowdfunding project we’ve run, and it also allows us to expose the brand to new audiences easily.”
Jackson Kayaks’ latest crowdfunded boat reached its funding goal in 40 minutes and then proceeded to hit four times its goal. Other startups have reported similar results, giving them the ability to proceed from concept to production. Kokopelli Packraft held a Kickstarter campaign for its Rogue Series Kevlar-reinforced inflatable kayak. The Colorado manufacturer says the campaign, which raised US$118,000 compared to its initial US$30,000 goal, lets it to get the Rogue Series to market by late summer.
“This campaign will allow us to get the Rogue Series packraft into full production and out on the water," company founder Kelley Smith, told the magazine. Supporters will receive a variety of rewards, as well as the being one of the first consumers to buy the new model.