Crowdfunding lets you test the market for your product before you even make it

The hardest part about designing a new product or service is that you don’t really know what your potential users might want — but using crowdfunding services like Indiegogo allows you to test the demand for various features before you spend a lot of time on them, designer Mladen Barbaric of Pearl Studios told attendees at Gigaom’s Roadmap 2013 conference in San Francisco on Tuesday.

Barbaric, whose design agency helped create the Misfit Shine — a wearable activity monitor that was one of the highest-funded projects on Indiegogo, raising close to $900,000 over the course of the campaign — said that he and his partner found using the crowdfunding platform “allowed us to iterate faster, design faster and get to a successful product faster.” The company went through more than 2,000 iterations of the device, he said, and it was extremely important to know ahead of time what features users wanted.

Danae Ringelmann, the founder and chief customer officer of Indiegogo, said that the flexibility of the platform allows designers to rapidly survey their users about what features they want — so the creators of the Misfit Shine heard that some users wanted necklaces and bracelets that used the same technology, and quickly added a “perk” on the site that allowed users to sign up for those add-ons. The demand made it obvious that it was a worthwhile feature to add, Ringelmann said.

The Indiegogo founder said that she started the platform because her mother and father were small-business owners who failed multiple times because they didn’t have the right financial and market connections, and that made her realize the system was broken. “I realized that finance is broken because people with the ideas didn’t have the power to make it happen,” she said. “I wanted to start a company to put that power back in the hands of the people with the ideas.”

Check out the rest of our Roadmap 2013 coverage here, and a video embed of the session follows below:

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A transcription of the video follows on the next page