Crowdsourcing has become a go-to for independent and open-source hardware creators hoping to turn a cool prototype into a polished product. But many projects fail along the way, often for nontechnical reasons.
Helen Leigh is the director of business development at Crowd Supply. A division of Mouser Electronics, Crowd Supply is a crowdfunding site for small hardware manufacturers making novel products. Leigh spoke with IEEE Spectrum about what makes a crowdsourcing project successful, and how Crowd Supply is trying to help.
What are some of the biggest mistakes applicants make?
Helen Leigh: Here’s a big one: setting your price too low. Engineers tend to focus just on the product and the cost of the bill of materials, right? But logistics is expensive. Putting your product on a shelf, taking it off, putting it in a box, putting a label on it, all of that.
Another one is when people say they’ve made something for X market, but they’ve never spoken to a single person in their target market. We advise people to throw themselves to the wolves of Reddit and social media.
How does Crowd Supply help applicants?
Leigh: We help with all the nonengineering parts of bringing a product to market, including financial spreadsheets, fulfillment guidance, and product photography. If a campaign is successful, we typically place a house order for at least as many as were sold in their campaign, paid in advance. But what’s become very important in the last few months is navigating compliance. Incoterms are really important now.
What are Incoterms?
Leigh: Say you were manufacturing some watches in China and shipping them to our warehouse in Texas. What happens if the boat goes down? Who bears that risk?
In the past, the term we mostly used was DDP: delivered duty paid. That’s where a creator is paying all the taxes and tariffs, getting everything to our warehouse free and clear, and we take it from there.
But in that scenario a tariff comes in and suddenly you, as an indie creator, are having to pay much more. You’re probably losing money now, which could destroy you as a creator, right? One way we take on the burden of risk is by offering FCA [free carrier] Incoterms, which basically means we pick it up from your place of assembly and it becomes our responsibility, including freight and the tariffs.
What impacts are you seeing from tariffs?
Leigh: Delays, of course, but tariffs haven’t stopped people from making stuff. I really do believe we’re in a golden age for indie developers. We have more choice than ever, plus technical education and documentation has never been better or more accessible, thanks to companies like Adafruit and Raspberry Pi.
One silver lining of tariffs is that designers are now forced to take into consideration the entire supply chain, which ultimately does make their designs better.
What’s your favorite Crowd Supply success story?
Leigh: The most obvious one would be SlimeVR. They do trackers that go on your body for virtual reality. They raised US $7.6 million, so they are very financially successful, but the way they have managed their community is what inspires me. They have openly talked about how vital community contributions have been to their software stack. It’s a nice example of what can come from opening your hardware.
This article appears in the November print issue as “Helen Leigh.”
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