Locked down in Wuhan: Coronavirus takes its toll on Kickstarter campaigns
Crowdfunding could be a barometer for the outbreak's impact on other industries.
Dantin Liu was supposed to be back home in Shenzhen by now, launching a long-planned Kickstarter campaign for a pair of innovative wireless headphones called Earhub.
But earlier this month, the 32-year-old entrepreneur made what was supposed to be a quick trip to Wuhan to visit his parents for Lunar New Year. And now he's stuck there, swept up in Wuhan's mandatory coronavirus quarantine.
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His launch date came and went Monday.
COVID-19 is hitting big companies like Apple hard, but crowd-sourcing entrepreneurs may have it worse. Some, like Liu, are locked down inside homes, unable to leave except to buy groceries. Others are seeing their nascent supply chains come to a standstill. And few have the resources to offset losses in China with other work elsewhere.
The result: Dozens of Kickstarter campaigns have already announced delays in launching and shipping their products.
Electric scooter maker eFOLDi announced shipping delays in a recent Kickstarter update. Electronic hearing protection maker Pro Ears told backers of its latest gizmo that the warehouses of its manufacturer would remain closed until the end of February.
Palo Alto Innovation told its backers that it has 2,000 of its Alexa-enabled alarm clocks packed and ready to go, if only someone was able to ship them. "We missed the last boat out of China before Chinese New Year, and the port still hasn't opened back up yet due to the virus," the company wrote earlier this month.
While companies like Apple and Amazon have enough insights into manufacturing trends to prepare themselves for further outfall from the coronavirus crisis, Kickstarter campaigns could be a good indicator for the rest of the industry as it braces for impact.
"Crowdfunded campaigns are often very transparent about their time and resources," said Tirias Research analyst Simon Solotko, who has been covering the sector and advising crowdfunding campaigns for years. "It's kind of an interesting barometer, very close to the metal."
Solotko said startups that build consumer electronics or other products with complex supply chains are feeling the brunt of the impact. "Crowdfunding campaigns are often at the early stage of manufacturing," he explained. "Those campaigns are often sourcing first runs."
For many Kickstarter entrepreneurs, the timing could not have been worse. All of China was effectively on a two-week break for Lunar New Year, already bringing communication with manufacturing partners to a halt. Then the virus hit, leaving people unable go back to work or even get back home.
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"Everything was supposed to ramp up two weeks ago," Solotko said. "And it is really slow right now."
Kickstarter says it's trying to help, but there's a limit to what it can do.
"We've been in touch with some creators whose work might be affected by this to offer them additional support and advice during this time, and we plan to share more information with our wider community soon," said Kickstarter's senior director of communications, David Gallagher. "Obviously, the most important thing here is the health and safety of those affected by the virus, wherever they may be."
While Western companies are waiting for updates from their Chinese manufacturing partners, startups in the region are doubly affected by the virus. The Hong Kong-based maker of the TagIt umbrella posted photos of a deserted Shenzhen in an update about shipping delays; the inventors of Trainerbot, a table tennis robot, included pictures of a co-founder getting his temperature checked by a local official in their most recent update.
Under mandatory quarantine, Dantin Liu is allowed to leave home only once every three days to buy groceries.Photo: Courtesy of Dantin Liu
And then there's Liu. He is now cooped up at home in Wuhan, allowed to leave only once every three days to go shopping. He shared photos with Protocol showing him donning latex gloves and a facial mask, the elevator buttons in his building covered with bleach, and a small cart filled with groceries from one of his occasional shopping trips.
Former Kickstarter Asia outreach lead Joris Lam, who now works with Liu and other Chinese creators like him, said that his case is far from unique. "Mostly everyone just sits at home, counting the days and hoping things will pass soon," Lam said.
The good news for Kickstarter creators is that their backers have been trained to be patient. "Crowdfunding campaigns are all about deferred gratification," Solotko said. "We always encourage backers to understand that Kickstarter is not a store — it's a way of helping creative projects come to life," added Gallagher. "It's common for unexpected things to pop up when you're trying to make something new."
Thus far, most backers seem to be more than understanding. In a comment to a post announcing delays for 3D printer SolidMaker, one backer replied: "Thank you for the update, please prioritise your employee's safety and don't feel bad." Responding to a delay announcement for eFOLDi, another backer wrote: "This is now a worldwide health concern and we all need to take any precautions possible, keep the staff safe first and foremost. Good luck."
As for Liu, he still hopes to get his campaign up and running as soon as possible. But in a nod to his hometown and its resilience, he plans to alter the labeling to read: "Proudly designed in Wuhan, Made in China."