A successful Kickstarter campaign is helping The Box bring healthy, local cuisine to one college campus.
Busy students need to eat and Eric Winn and Mike Parshley, students at Dartmouth College’s Tuck School of Business, found a way to help them feed themselves while on the go. The duo launched The Box, a student-led food truck targeting Dartmouth’s campus.
Their Kickstarter campaign wrapped up on March 13, having raised $16,120 to help cover startup costs from more than 200 backers and surpassed their initial funding goal of $15,000.
The truck will employ undergraduate and graduate students from the college who will serve up locally sourced, Mediterranean-inspired fare to their classmates, professors, college staff, and others on the Hanover, N.H., campus.
CrowdfundingPR talked with Winn about why his team sought crowdfunding as part of their financing strategy and what they learned from the experience.
In launching The Box, what market need did you identify and why was a food truck the answer?
Dartmouth students are very active and they need convenient food options. They also want high quality and healthy food, which often runs against convenience. The college’s campus dining is well regarded and Hanover, though not always convenient to campus, has several great dine-in restaurants. We saw an opportunity to bring a unique, student-run culinary experience to campus. We found a food truck to be the best delivery platform, as it allows us to be mobile and fit wherever our customers need us.
What was the advantage in getting Dartmouth students involved?
We believe in the power of experiential learning and wanted to add value to the educational experience. We could have launched any number of businesses that could be run by students, but this one is unique in that it is student-run and it is local. That keeps operations to a scale that is manageable for managers and employees, whose full-time jobs are as students.
Relatively few food trucks have successfully crowdfunded their launch. Why do you think you succeeded?
We had several very generous backers. These were mostly from our personal networks—family and friends. It was an opportunity for them to support our endeavor in a very significant way, while they may not have been eligible to invest otherwise due to regulatory constraints.
We also had many backers among current students and alumni. Our Kickstarter campaign was primarily about raising necessary capital, but a key secondary motivation was to increase awareness and generate excitement. Our number of backers, more than 200, shows that excitement.
Finally, we had a great team working on the campaign. Our student management group, made up of both graduate and undergraduate students, worked hard to market the campaign and each one of them was responsible for bringing in some number of backers.
Why did you choose to crowdfund?
We always believed we could run a successful Kickstarter campaign. During our investment-raising timeframe in late 2013, we decided that a mix of equity investors and crowdfunding would be the best way to raise funds. The majority of our necessary capital came from equity financing.
Who did your campaign target?
In addition to our personal networks of friends, families, and co-workers, we also targeted the Dartmouth community: students, faculty, administrators and staff, as well as alumni.
We did not target the local community as much, but they inevitably became aware of us through our other channels. The Dartmouth community is so strong that we were confident it would generate a lot of interest.
How did you market to those groups?
Mostly through emails, some more personal and some more broad. We also used Twitter and Facebook. Supporters of ours at the college helped to get info out to the alumni groups, in particular.
How did you determine your perks? And did the fact that Box is a student-focused venture influence their value versus their reward?
We wanted our rewards to be focused on the truck itself and what we are offering, hence the free meals, cooking lessons, and private events. We also wanted people to feel like they were a part of this with us, which is why we are also distributing t-shirts.
Can you share three lessons-learned from your crowdfunding experience?
– It’s critical to have a strong and comprehensive marketing plan at the time of launch. You need to generate momentum early and get a good base of contributions before you get into the longer, slower remainder of the campaign.
– It’s also important to have features in your marketing content, such as a video, that explain your call to action. We spent a lot of energy on our video and it was important that our backers had a platform through which to hear directly from our team. The content should answer questions such as: Why are you unique? How are you adding value? And why should people care?
– Once you get your initial momentum, it’s important to stay focused on generating new leads and new momentum. If you know of generous backers who are ready to commit, have some jump in at the beginning but also save some backers for later in the campaign to help signal ongoing progress.
Did you learn anything from crowdfunding that you wouldn’t recommend to another food truck operator who is also running a campaign?
If you are not unique and do not have a compelling call to action, I’m not sure crowdfunding is for you. You likely won’t generate any excitement if you are just another operator and it would also beg the question of why people would want to help out. If you can signal that you are going to add value beyond being another food option to your community, however that is defined, then you have a starting point.
Do you have any tips for entrepreneurs who are considering crowdfunding to fund all or some of their launch?
Don’t plan on being able to use crowdfunding to generate all, or even a large percentage of, your funds. We had a very loyal and committed population to target, but inevitably as people get more removed from your personal network, your hit rate goes down considerably.
We were surprised in some cases by the significant generosity of those close to us and equally surprised by the low percentage of people who contributed once they were two or three steps removed from us. This severe drop-off makes sense, but we did not plan for such a dramatic difference.
Fortunately, one offset the other. We raised only 10 percent of our required startup capital via Kickstarter; something in the ballpark of 10 percent to 20 percent probably makes sense for a food truck to expect to raise.
This interview has been edited and condensed for clarity.
Hallie Busta is a Washington, D.C.-based journalist covering start-ups, small business, and architecture and design. She can be reached @halliebusta and halliebusta@gmail.com.
