For the longest time, #VentureCapitalists (VC) and #AngelInvestors have powered startup ventures. It is estimated that the latter accounts for about $20 billion worth of investment year on year while $45 billion was put in by VCs till about a couple of years ago. #Crowdfunding, a relatively new phenomenon has grown exponentially in the last decade thanks to the opening up of the internet. Plus multiple funding models (donation, equity, rewards) has made things even better with no less than the #WorldBank estimating that in the next three years crowdfunding would hit a figure upwards of $90 billion. Yet it is a fact that only a third of crowdfunded ventures ever succeed. So where is the hitch?
You might have a very innovative product that is very well received on the crowdfunding portal where it is showcased. Surprise, surprise! It is after this that the real battle begins. For what is overwhelming for most such startups is marketing and distribution. Deciding on the right retailing price, managing an ever increasing inventory and standing out in the face of newer competition can be quite the challenge. What if you had access to an well established network that has millions of existing customers the world over? That would take care of selling your product while you could focus your energies on your core strength – innovation. Enter Amazon LaunchPad.
In the year 2015 ecommerce giant #Amazon started the #Launchpad program with the explicit intention of providing startup ventures a global platform to sell their products. It seems that the very successful crowdfunding site, #Kickstarter was the inspiration behind this endeavor and very quickly the folks at Amazon realised that though there were enough online avenues for startups to get crowdfunded scaling up operations to reach more customers across the world was proving to be tough. And retailing happens to be something that was and is Amazon’s forte. This paved the way for the Launchpad, an online marketplace solely meant for products made by startups.
To kick things off the owner of a startup needs to create an Amazon vendor account after which the initial shipment needs to be sent to Amazon where they evaluate if there is a market for such products. Once a startup gets the approval they get to have a custom page where one can upload product images & videos. From which point onwards Amazon takes over and using it’s global network of fulfillment centres (FBA) it ensures efficient and timely delivery of the products. The shipping takes place using #AmazonPrime which means it is done within 48 hours and is totally free. What else, did you ask?
A vendor registered with Amazon Launchpad gets access to the customer review program of the ecommerce giant called Amazon Vine which will help spread the good word. That Launchpad has partnered with several top notch crowdfunding sites like Y-combinator, Kickstarter and #Indiegogo (among others) is an additional benefit to startups. This means that if your product has been crowdfunded on any of these platforms it will be given preference over others that are not. Those wanting additional logistical support can make use of Amazon’s #ServicesHub. So is there a downside at all? Now that depends entirely on your product.
If you are a small company dependent on slender margins you might not get any from Launchpad. For starters you will need to send the initial shipment free to Amazon for their nod. Also you will need to sell at wholesale price to Amazon who will in turn decide on the right retail price. But all said and done these are all minor irritants in what is otherwise a fantastic platform for any startup company. And the benefits clearly outweigh the drawbacks. As long as you are a startup armed with an innovative product that you want to sell, the Amazon Launchpad is the place to be. Without a doubt.
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