In recent years, a shift has occurred in the way in which business start-ups receive funding for their latest products. This has been provided by various platforms, i.e. Kickstarter (2009) and Indiegogo (2007), which allow for accessible methods of community-funding and traction. In this article however, we see one entrepreneur who has chosen to by-pass this trend, claiming it is an unreliable method of financing which would ultimately harm his company’s actualisation of their product (the Raden Smart Suitcase).
Raden CEO Josh Udashkin has stated, “I didn’t want [the product] to be too engineer-driven,” which he claims would harm the longevity of the RSS. This is due to the potential for ‘unrealistic expectations’ and quick ‘burnouts’ to occur, which may impact the motivation his company has to complete the suitcase as it was originally intended. Instead, Mr Udashkin has chosen to seek out a more traditional method of funding (i.e. Venture Capitalist funding) which - while more challenging to acquire in the short-term - may mean Raden has greater control over it’s product’s manufacturing in the long-term. Mr Udashkin has observed the failure of several large Kickstarter projects including the Zano Drone ($3.4 USD in funding). He believes such failures came as a result of the risks associated with the online funding platforms mentioned above.
This article relates to the Business Concept of strategy. This can be seen in the way in which Raden has chosen to fund it’s product strategically. Their strategy involves both long and short term thinking which is often not addressed in the constantly changing technology sector. It is clear that unlike a number of other entrepreneurs, Mr Udashkin does not believe in a small project with a large initial return and no long-term interests. Instead, he has chosen to ensure that the product he is bringing to market meets his company’s initial demands in quality and functionality, before being released to the wider market. This would then allow for a more coherent business plan and the actualisation of their product’s long-term success.
