The cash raised online for first-of-a-kind products can be dazzling. In 2012, the start-up Pebble raised $10 million from people eager to be the first on their block to wear a new kind of smart wristwatch. Coin collected $50,000 in less than an hour last year for a sleek new digital device that can store data from up to eight of your credit cards.
Crowdfunding sites such as Kickstarter are playing a role similar to those once performed by the Sharper Image or QVC. But it can be easier to create an online informercial for whizzy new items and start “crowdfunding” money than it is to actually make and deliver products.
Dragon Innovation of Cambridge built a business by helping consumer electronics entrepreneurs — including those behind Pebble and Coin — make sure their products can be manufactured on time and on budget.
Last year, Dragon moved beyond that support role to start promoting a handful of consumer products on its own crowdfunding site. Those new products, including an electric skateboard with a 20-mile range, have collectively raised $750,000 on Dragon’s own site, and more are on the way.
“We’re very selective about what will go on our platform,” said Scott Miller, the founder and chief executive of Dragon.
Tessel, one company with a product on the Dragon site, makes a small circuit board to wirelessly connect objects to the web. It’s gone on to raise venture capital funding.
Tessel co-founder Jon McKay says that “public validation and momentum” on Dragon’s site helped show investors that an idea “can be grown into a sustainable and highly-scalable business.”
Dragon itself raised its first outside funding last year, collecting $2.3 million from investors including Boston-based Flybridge Capital Partners.
“The hardware ecosystem is truly exploding,” said Thos Niles, Dragon’s vice president of product. With that growth, he adds, “comes a lot of chaos.” Dragon hopes to build a big business by bringing order to that world.