In the old days, Alice Feiring knew exactly what she needed to do to launch her natural wine newsletter – find a publisher willing to give her an advance. But the old days are gone, and publishers are worrying about other things, like staying in business.

So Feiring, perhaps the most respected natural wine writer in the country, took the 21st century route – funding her newsletter with Kickstarter, the Internet-based crowdfunding site.

Capture d’écran 2013-05-05 à 23.29.46“I was overwhelmed by the response,” says Feiring, who raised almost three times as much money as she asked for, nearly $17,000.  “And I had no idea who most of them were and I had no idea about the reach of my writing. It was validation of what I was doing.”

In this, Feiring is one of a growing number of wine writers who have funded projects through Kickstarter and similar sites like Indiegogo. Lisa Talarico, who works for a distributor in Portland, raised $2,000 – $500 more than her goal – for series of online wine guides called “Know More, Pour More” targeted at restaurant staff and wine enthusiasts. And I raised $8,000 for the my book, The Wine Curmudgeon’s Guide to Cheap Wine, due out this summer.

Crowdfunding is relatively new – Kickstarter, the best known of the platforms, is only four years old. But the concept has drawn tremendous attention for its ability to give people with ideas, be they writers, filmmakers, musicians, or entrepreneurs, access to capital through the Internet. There are no bankers, stuffed suits or collateral; instead, projects are funded by raising small amounts of money from a large number of people, who pledge not because they get a piece of the deal but because they think it’s a good idea. Feiring had 214 backer for her newsletter, The Feiring Line, while 45 people supported Talarico and I raised money from 113 people.

“The most difficult thing about using Kickstarter for me was the confidence,” says Talarico. “Would people support me? So people with a good idea need to know to just do it and not let that get in the way.”

Know the basics

Think of crowdfunding as the post-modern version of the PBS pledge drive – pledge a certain amount and get a gift, with projects offering different premiums at different price levels. Plus, the premiums are cumulative, so someone who pledges at a higher level gets everything offered at the lower levels. Feiring had six levels, ranging from $10 to $1,000. Those who pledged $60 got a newsletter subscription; those who offered $250 received cellphone sommelier service plus the newsletter subscription and a gift subscription to the newsletter. In this, fulfillment becomes a crucial part of the process, and Kickstarter warns participants of that ahead of time: “This is where the real work begins!”

Otherwise, the process is straightforward, say those who have done it. Talarico, who says she isn’t all that computer savvy, found it lengthy but not especially difficult:

• Kickstarter is all or nothing. If you don’t raise the entire amount, you don’t get any of it (though Indiegogo does let participants keep partial amounts). Only about 40 percent of Kickstarter projects reach their goal.

• You own the project. All the crowdfunding sites do is help you raise the money, for which they take their cut. Once you’re funded, you can sell books or subscriptions without an obligation to the site or your backers.

• The site guides you through creating the project – defining and explaining it, setting up premiums, adding pictures and video, and deciding how long fund-raising will last. The video, which Kickstarter says is a key part in reaching your goal, is perhaps the most aggravating thing to do, said everyone I talked to. I shot mine twice, with many fits and starts for each shoot, and enlisted a photographer friend to shoot the second since the first looked and sounded like I was recording in a closet.

• People pledge in Kickstarter with a credit card and are billed through Amazon, which has a service called Amazon Payments (similar to Paypal), and they aren’t charged until the project is funded. Kickstarter takes five percent of the money raised, while Amazon Payments takes another three to five percent. Indiegogo uses PayPal and credit cards, and its terms are more complicated, taking into account whether you reach your goal and if you’re a non-profit.

• Kickstarter must approve each project, and there’s a long list of projects that don’t meet its guidelines, including non-profit ventures, health and beauty care, and firearms. It seems a bit leery of wine-related projects (a company spokesman declined to be interviewed for this article) and forbids alcohol to be used as a premium.

Making it work

What the crowdfunding sites don’t do is come up with ideas or help you with the actual production process. If you want to write a book, you have to figure out what it will be about and how to handle things like layout, printing, and marketing. Feiring needed money to hire a designer; I needed  money to pay for everything from layout (e-books need to be set up in a half-dozen formats) to copyright and even getting ISBN numbers.

The other thing the sites can’t do is guarantee fund-raising success, as demonstrated by the 60 percent failure rate on Kickstarter. In this, success seems to rest on social media – getting the word out through things like Twitter and Facebook, and then having those people use social media to let other people know. That was extremely successful, says Feiring, who purposely didn’t want to ask her family to contribute. Talarico also found that social media helped increase awareness and pledges, especially from her colleagues in the wine business.

I learned that lesson the hard way. I’m not especially fond of Facebook, and though I’ve finally figured out Twitter and use it, I thought that writing an Alawine.com top 100 blog for five years would be enough to let people know what I was doing. It wasn’t, and my inability to use Facebook to drive awareness and pledges left my funding in doubt until a couple of family members agreed to make up the difference.

The other thing that seems plays a role in funding success is location. Those of us who live in the middle of the country are apparently less crowdfunding aware than those who live on either coast. Feiring and Talarico both said they didn’t have problems with people who didn’t understand Kickstarter and how to use it, while I spent as much as a quarter of my time during fund-raising explaining crowdfunding and how to pledge. One friend, who wanted to support the book, said he never got past my Kickstarter page; he kept getting error messages when he clicked the pledge button.

What social media does is add to the sense of community that is integral to fund-raising success: “You want people to root for you,” says Feiring. “You want them to know that they’re helping you create something. They don’t want to give you a handout. They want to be part of what you’re doing.”

The other thing to know? It’s quite a rush when the project is funded. “I felt like Sally Field at the Academy Awards,” says Feiring. “People really did like me.”

 


Jeff Siegel writes the Wine Curmudgeon blog, is the wine writer for Advocate magazines in Dallas and freelances about wine for a variety of regional and national magazines. His philosophy is simple: The wine industry tries to intimidate consumers instead of educating them—and nuts to that. Wine should be fun, not intimidating.

  • http://www.glasshauswines.com Rodney Gagnon

    Hi Jeff,

    Very good piece explaining the challenges of crowd-funding and the use of third-party services.

    I am launching a crowd-funded community supported winery project with a social mission and, since shares of wine production (à la futures) are offered, I can’t use third-party services. Not a problem as I simply created a store and will list the “wine shares” as a product for purchase. I’m assessed a standard 2.9% transaction fee from merchant services compared to the 5+% that the crowd-funded and merchant services charge.

    Relating to your points above, the third-party services merely offer the mechanics of collecting the funds and maybe a place where people can find your campaign if they happen to be looking for such a project. But, rightfully so, building audience/community remains up to us.

    Congrats on reaching your goal.

    Best of luck,
    -Rodney

  • http://www.winetravelmedia.com Wink Lorch

    Thank you for this post even if I wish it could have been published earlier to encourage me when I tentatively launched my project nearly two months ago to fund the production of my book on Jura wines. Fortunately it worked really well (187% funded) so now I’m just waiting for the money raised to hit my bank this week. I am very grateful that the site exists, and even more so to the 376 backers. As I’m based in Europe – the UK specifically – but with backers from all over the world, my experience has many overlaps with both Jeff’s and Alice’s but some different as[ects too.

    Kickstarter launched in the UK last autumn – before then without the right US credentials, other nationalities couldn’t use it at all. The UK system works not through Amazon payments but the usual credit cards are accepted from around the world (one backer– a Brazilian – never managed to get his sole card accepted, but others have had no problem). I was expecting much support from US contacts, but a few were initially questioning, because I was obliged to use pounds sterling for both the target and the pledges. I dealt with this in the text as I mentioned rough dollar equivalents now and again to save people having to check.

    I have to say that although I did not receive as many questions as you did Jeff – I think Europeans who are scared of something new like this simply don’t proceed, rather than ask the question – I did have to explain things very carefully to a few people. But also, I took great pains in my text to explain the process, and I added ‘made-up’ FAQs at any hint of uncertainty from anyone. You can add these anytime.

    One of my concerns was indeed the Kickstarter attitude to alcohol. One of my rewards – like Alice’s project – was the chance to have me guide a tasting. I was very careful not to mention that the wines would be included. Kickstarter never questioned it.

    As far as promoting the campaign, yes I had a very good Facebook and Twitter following built up over several years and these were crucial to the success of this project. However, I also used email to other networks – the Association of Wine Educators (I’m a founder member and ex-Chairman admittedly) based in the UK were willing to email members about it. And I emailed a few individuals personally, and then around 400 contacts from over the years in a blanket Mail Chimp email – friends, colleagues people I’ve done wine business with (talks, articles, tours etc) and so on. I think email is hugely underestimated as a tool. Also several bloggers (who I know personally) actually wrote posts about it and the UK-based Drinks Business Magazine wrote an on-line piece following a phone call I had with the editor about an article I was writing – I just happened to mention that he might find my project newsworthy.

    I found it really strange doing what felt like hard-selling for a whole month. Writing very non-British upbeat Updates featured too. But, potential and actual backers didn’t seem to mind and in fact encouraged me. It was a great experience of support. But also, I think that this was because I truly had a project that people really believed was filling a gap and they wanted those rewards. And that is THE most crucial aspect to the success of any crowdfunding project. It has to be a product that is new and that people really want.

    Now I must get back to writing that book. I have nearly 400 people waiting on it – and that was definitely at least half of the point of doing it – checking if the interest was really there.

  • http://winecurmudgeon.com Jeff Siegel

    Thanks, Wink and Rodney, for the kind words, as well as the advice on making this sort of thing work. Each of you mentioned an important point that may well intimidate wine writers from trying this approach:

    – “Building audience/community remains up to us.” This is not only difficult to do, but difficult to understand. Doesn’t everyone already want to read us?

    – “I found it really strange doing what felt like hard-selling for a whole month.” This may even more difficult than the first point. It made me crazy, having to tweet and beg and so on and so forth.

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