B-School Startups: Crowdfunding Ideas With Indiegogoby
Editor’s Note: This story is part of Bloomberg Businessweek’s occasional series on the world of startups. The series focuses on MBAs and undergraduate business students who developed their ideas or launched their businesses while still in school, as well as the many ways their schools helped them get their new ventures off the ground.
University of California at Berkeley MBA alum Danae Ringelmann convinced investors in 2008 that her untested crowdfunding startup, Indiegogo, was worth watching. By 2012 she was part of a movement that had persuaded Congress to change U.S. equity laws so that crowdfunding companies like hers could expand.
“The word ‘crowdfunding’ didn’t even exist when we started,” says Ringelmann, who graduated from the Haas School of Business in 2008. “That was the biggest challenge in the early days.”
Congress relaxed securities rules last year, making it easier for entrepreneurs to raise money on sites such as Indiegogo, Kickstarter, and CircleUp.
Ringelmann had a hand in winning over Washington: Her team wrote a series of case studies on the merits of crowdfunding, which they provided to the politicians who signed the new rules into action. The passage of those rules was one of many milestones for Indiegogo, which raised $15 million from investors in June and has launched more than 100,000 projects, the largest of which raised nearly $1.2 million to build a robotic dragonfly used for aerial photography and other applications.
Ringelmann, who co-founded Indiegogo during her second year on campus with fellow Haas student Eric Schell and Slava Rubin, a former colleague of Schell’s, credits the school with giving her the powers of persuasion that put her on that path. She cites professor Cameron Anderson’s class, Power and Politics in Organizations, as one of her most influential B-school experiences as a student entrepreneur.
Anderson says the class is about the “art and science of influence.” It teaches students to communicate clearly and compellingly, “and how to see their ideas through the eyes of others so that they can pitch things in a way that will resonate.”
“We focus a lot on interpersonal style, using body language, cadence of speech, and vocal tone,” he says.
One of Anderson’s go-to exercises is to have students take improv lessons. He once flew in a coach from Los Angeles-based comedy troupe the Groundlings, which counts former Saturday Night Live cast members Will Ferrell and Kristen Wiig among its alumni. The improv instructor had students perform an exercise called “Yes and …”
“This is where one person tells part of a story, and you can never say no. You just have to say, ‘Yes and …’ and validate the story as well as build onto it,” Anderson says.
Another improv exercise entailed a string of 10 students lining up and telling a story, with each student saying just one word.
“Improv requires active listening. You really have to pay attention to what other people are saying and not just think about what you will say next,” Anderson says.
Those skills likely resonated with Ringelmann, who prior to attending Haas worked as a financial analyst covering the sports and entertainment industries. She was responsible for equity research on major movie studios and companies such as Pixar Animation Studios. She says one of the most memorable deals she worked on involved the sale of the Minnesota Vikings.
Ringelmann initially came up with the idea for Indiegogo as a way for independent filmmakers to fund their own projects, and she went to the Sundance Film Festival in 2007 to try and get support. By 2011 the company had raised $1.5 million in its first funding round.
Anderson says he often gets e-mails and calls from past students such as Ringelmann who talk about how the course has influenced their early career moves.
“The No. 1 thing I hear is, ‘I use this all the time.’”