Chinese brands are huge on crowdfunding, even if you’d never know it

Jim Fields has seen his fair share of crowdfunding videos — he’s made more than a dozen of them for Chinese brands looking to expand abroad — and he knows how to make a not-quite-finished hardware product look like it’s ready to go in a video. A drone, for example, that can’t actually fly will look like it is when held up with fishing wire.

“You don’t really want to be involved in a project where they’re never actually going to deliver it because that can sully your own reputation,” Fields says. “So our rule generally is if it seems legitimate and the product is actually [at] a functional prototype stage, then we’re okay with it.”

Fields’ services have been increasingly in demand as Chinese startups look to either IPO abroad or bring their products to US crowdfunding platforms.

Crowdfunding companies in the US have recently tried to court more international entrepreneurs, and Indiegogo has been particularly focused on China. When Andy Yang took over as CEO in 2019, the company cited expansion in China as one of its goals. At the time, Indiegogo was already “the largest US-based crowdfunding platform in China with over our platform,” outgoing CEO David Mandelbrot wrote.

39 Chinese entrepreneurs raised over $1 million on Indiegogo by 2019

To reach that milestone, the company relied on an in-house team hyper-focused on getting startups from China to join the platform. Lu Li, the general manager of global strategy at Indiegogo, spearheads that group now, which helps entrepreneurs from abroad use crowdfunding as successfully as possible. She was hired three years ago to help these creators understand how to pull off marketing and PR for an American audience.

Indiegogo’s international aim comes with some real advantages. For one, these creators have close proximity to manufacturing facilities, which can make it easier for them to produce and fine-tune products than their American counterparts. “When it comes to crowdfunding, Chinese entrepreneurs fulfill their perks at a higher rate than campaigners from the rest of the world,” Li says. “So, obviously, in the spirit of getting backers better campaigns that can deliver their perk promises, we want to have creators that have that manufacturing capability to be able to do their campaigns on the platform.”

Li also says these companies design their products with American consumers in mind. “They spend a lot of time doing R&D and understanding the user scenarios of the consumers here, and they design products in a way that is affordable, but also good for use,” she says, which appeals to potential backers.

Although Li’s team helps entrepreneurs start and run a campaign, the creators still worry about the stigma they might face when thrust in front of an international audience.

Jacob Guo, for instance, wanted to launch his China-based electric skateboard company Walnutt in the US, but he initially worried that backers might think the product was fake or a copycat and therefore wouldn’t back it.

“In 2017, when we started to do this skateboard crowdfunding, we [had] to deemphasize the truth that we’re from China,” he says. It’s not that he and his team lied about where they live and where their product came from, but they preferred not to say so directly. He says other companies will bring in a Western actor as a spokesperson or will advertise a lower member of their team, who is white, as an executive to deemphasize where they’re from.

The Spectra electric skateboard from Guo’s company Walnutt. Image: Walnutt

“There’s definitely a stigma when it comes to Chinese products entering the American market,” says Li, which is why many Chinese crowdfunding campaigns feature images with Western-looking models rather than photos of their own team. “There’s definitely IP issues, counterfeits, copycats, but I would say things have significantly improved throughout the years.”

Fields says some of his clients think creating a “global” brand means casting “white people in the videos.” Fields and his team will present product creators with actors from various ethnic backgrounds, but the creators often end up picking white models, he says.

“Even if we’re doing something that’s purely for a domestic audience, sometimes we’ll have it with Western actors,” he says, which he credits to Chinese companies often facing prejudice against their products. They want these Western actors so “they’re perceived as being more high end, or reliable, or maybe in a higher price bracket,” he says.

Along these lines, Indiegogo’s Li says founders will anglicize their names or “bring in a random white guy” for group photos to “make themselves look more legit.” Li’s team encourages creators to “be authentic,” but “at the end of the day, as a platform, we can’t tell campaigners how they want to represent themselves,” she says.

“I think there is a certain level of insecurity that may be an overreaction of a historical past of how Chinese companies are perceived in the US,” she says. “That’s unfortunate because you’re again losing out on an opportunity to tell the world that Chinese innovations are there.”

Founders might anglicize their names or highlight a white employee as a high-level executive

Guo thinks the stigma is waning, however. He attributes the broader acceptance of Chinese brands to a few who’ve spearheaded the way. He cites DJI, the popular drone company, as mastering branding abroad and making Chinese hardware desirable. He also names Insta360, a company that specializes in 360-degree cameras, as another example of a company that’s performed well outside of China and serves as a model for how Chinese companies can succeed abroad.

“Be proud of your country of origin because, at the end of the day, it is really about the product being awesome,” says Li. “When your audience buys the product, uses the product, and then likes it, that’s all that matters. It doesn’t matter if it’s labeled, ‘Made in China.’ All they care about is that this is a great product, and, at the end of the day, that’s what matters.”

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