2015-05-20 10:00:00 Crowdfunding English A Baltimore watering hole used the Indiegogo crowdfunding site to raise awareness and to keep the business open when structural issues... https://quickbooks.intuit.com/r/us_qrc/uploads/2015/05/2015_5_14-large-am-baltimore_bar_turns_to_crowdfunding_to_save_their_small_business.png https://quickbooks.intuit.com/r/finding-funding/baltimore-bar-turns-to-crowdfunding-to-save-their-small-business/ Baltimore Bar Turns to Crowdfunding to Save Their Small Business

Baltimore Bar Turns to Crowdfunding to Save Their Small Business

4 min read

While the internet has certainly helped many small businesses, it has also been vilified as a small business destroyer. For every business that has benefitted from lower overhead and wider reach, there is another that has seen its brick-and-mortar business dwindle due to competitive pricing and increased costs.

Crowdfunding seems to have the ability to do both, offering small businesses a boost wherever needed, whether to launch or stay afloat. Case in point: The Idle Hour, a beloved Baltimore watering hole that used Indiegogo to not only raise awareness of their business, but to keep it open when a structural issue threatened the safety of their space.

Company Name: The Idle Hour in Baltimore, Maryland

Campaign Goal: Raise $40,000 from donations while securing a loan for $40,000 from another financial institution

Campaign Outcome: Raised over $48,000 with 289 funders

The Idle Hour is a corner bar established 12 years ago in Baltimore. With an eclectic feel and strong community vibe, it has become a favorite for natives and visitors who enjoy a cozy and sociable drinking spot. It’s easy to see, based on their 4.5 rating on Yelp and the accompanying reviews, that The Idle Hour wins for ambience, vibe and music.

How Did The Idle Hour Do It?

When you’re looking to fund a construction project for an already-beloved local establishment, the rules for crowdfunding are a little different. The Idle Hour didn’t need to convince anyone how cool it was. Instead, it just needed to appeal to its loyal customer base by convincing them that it was cool enough to preserve.

Their campaign’s local flavor also helped it to gain attention from local media, including the Baltimore Sun. This type of exposure definitely helped raise awareness of the campaign.

Lesson Learned: Tapping into people’s emotions—especially nostalgia—is almost always a guaranteed way to make an impression. While you don’t want to come off as manipulative, stress how much the patrons and the ownership love the space. It’s easy to see that the love of the community definitely helped The Idle Hour in its time of need.

What Made the Campaign So Special?

Many crowdfunding campaigns live and die based on the rewards they offer, and The Idle Hour smartly capitalized on this. Knowing that their funders would more than likely be loyal patrons, they offered rewards that would appeal to their current customers while also creating a reason for funders to keep coming back.

Even at the $5 pledge level, funders were given a sticker with The Idle Hour’s name on it, meaning anywhere they choose to stick it becomes an advertisement for the bar. Additionally, one of their key rewards involved their signature cocktail Chartreuse, giving funders who pledged $400 or more their very own bottle to keep at the bar and drink whenever they visit. They also capitalized further on the cocktail trend by offering a chance for funders to create and name their own cocktail, which will become part of The Idle Hour’s menu upon the bar’s reopening.

Lesson Learned: When you know your market, don’t be afraid to cater to it. The Idle Hour’s patrons obviously enjoy hanging out in a small, intimate environment, especially one with a vibrant community. They also like to drink. By combining the ability to create and name their own cocktails with a pledge level, The Idle Hour was able to expand its menu selections and give its customers a significant role in that expansion—as long as the bar remained open. Plus, who wouldn’t want to bring all of their friends in to sample their cocktail, now featured on the menu?

Chartruese

What’s Next for The Idle Hour?

A grand reopening … hopefully soon? Their campaign page on Indiegogo offers an update thanking the funders for their support, but there isn’t yet a timeline in place for when they anticipate getting the wall fixed and the bar reopened. The campaign was only funded a little under a week ago, however, so it’s possible that all of the logistics are still being hammered out.

Lesson Learned: It’s best to be as specific as possible in providing your funders with updates. The more clear and open your communication is with your funders, the better they feel about the money they gave, and the more excited they get about seeing their dollars in action.

Crowdfunding isn’t only about product launches and prototypes; it’s also about saving your favorite neighborhood hangout or helping your child’s school get the supplies it needs. If anything, these crowdsourced sites and campaigns have shown us that success is truly based on how your business measures it.

If you want to read more about a successfully crowdfunded business, check out this piece about GrowlerWerks’ uKeg in Portland, Ore.

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Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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