In the last few years, I have seen a host of sites appear that help you with design for your business or personal brand. Seeing as I know nothing about the subject of design, I thought I would interview the founder of the very popular DesignCrowd business, Alec Lynch, to educate us all. Alec started the business because he saw a problem with businesses buying designs from traditional methods. He viewed the process as slow, expensive and even risky. The risk he saw was that it could take a few months and then after all that you could hate what you ended up receiving from the designer.
Talented designers struggled to break into the design industry. In Australia, for example, there are 20,000 designers employed full time but around 60,0000 have graduated from design courses and don’t have employment. The numbers are similar in other developed economies. DesignCrowd attempts to fix the traditional problems of the industry by allowing customers to get designs faster (first designs by the morning), offering better value for money, allowing more creative designs (with over 400,000 designers), allowing designers to compete on creativity as opposed to cost, and allowing more choice with an average of 60-100 designs for your project.
DesignCrowd was launched in January 2008 out of Alec’s mums garage in a design industry that now is now more than $50 billion dollars. The first 2 years of the company were funded my credit cards and loans from Alec’s friends and family, in 2009 they raised $300k AUD in angel investment and grew the business fourteen-fold over the next two years. In 2011, they raised a Series A venture capital round of $3 million with Starfish Ventures.
Since then they have grown the team from three people to thirty-five people. In 2013, they raised a Series A1 again from Starfish Ventures and then in 2015 they raised a Series B led by Airtree Ventures for a further $6 million AUD. Their current revenue run rate is $20 million per year, and more than 75% of their customers are outside of Australia.
“The main thing that separates a wannapreneur from an entrepreneur is action. Don’t get too lost in books and start your business on the side or buy a domain name, but just take action”
Similar to Blue Dot, who we interviewed earlier, Alec and his team approached dozens of venture capital firms before they found the right one. Some of these approaches were relationship building, and others were actual pitches. In order for them to raise a round of funding it typically took 3-12 months to put a deal together. Alec says, “the more firms you approach, the more chance you will have of being successful in funding your startup. If you end up speaking to a large number of firms and you don’t get much interest, it probably means you need to look at your pitch, the product or the even your team.”
Having multiple, interested investors through this process can also assist in creating that magical, competitive tension that works in your favour.
Time Square and Virgin have used the platform, and there have been quirky projects like a tattoo design that says who’s your momma and a snowboard design – the options are limitless. Expect to see DesignCrowd expanding further in the USA and UK as well as other geographies.
The secret sauce of online marketplaces
One of the hardest challenges to overcome in any marketplace business is getting both sides of the market onto your platform. DesignCrowd took the logical approach and started by getting the designers first. They did this by running a crowdsourced contest and offering some money to have their own logo designed. This contest was promoted at design colleges and universities to attract designers to the marketplace.
As they acquired customers and projects were put up on the site, more designers came to the site and started telling each other in a very organic way. The other way they have increased both sides of the marketplace is to make some small acquisitions of websites and design communities, which has helped inorganically, grow the bottom line.
Many marketplaces have a natural “viral loop.” When a customer posts a project and requests a design with an offer of money, this creates content. Essentially this is a job listing that Google can now index, and it can be shared with other designers.
As designers respond by uploading designs, once the project completes each of those designs become public on their own page linking to the overall project and the designer who created them. This also creates content for Google and bloggers which helps attract designers and new customers.
Below are the six tips that Alec Lynch gave me for creating a great design for your startup.
1. Attract a good designer
To attract a good designer to your project you need to write a good brief, that’s not too long and not too short. Really short briefs signal to designers that you don’t really care or you might not be clear what you want. If your brief is too long, it can imply that your work is too difficult and is going to take a designer too long. In a marketplace context, a designer could be more inclined to gravitate towards a project that is easier. If you have lots of ideas about your design, you need to find the essence and the direction you want to go in a simplified way. Prioritise the parts in the design that are most important to you.
2. Pay your designer a fair price
You should be offering an amount of money for your design that your startup is comfortable paying and think is good value. Ideally you want to be offering more than the average amount of money in the marketplace, and then you will naturally attract the best designers that are on the site. It’s also worth handpicking designers from the directory that’s available.
On a platform like DesignCrowd, you can offer small participation payments to top designers that come off your budget, to encourage them to work on your project. Designers typically put more effort into these projects and prioritise them over others, which can help you get the best design.
3. Consider using the same designer again for future work
Sites like DesignCrowd allow you to work one to one so once you find a designer you like, this can be an easy way to move forward without having to run contests in the future. Around 20% of projects on DesignCrowd are follow-up projects. Even if the designer you used two years ago is not active, there is usually a 95% chance that they are still available on the site, so you can reach out to them again.
This was something that I found very comforting to hear. In the real world, you would normally only have a relationship with one designer that could be risky for your business if they become busy or go full time with another client. With a marketplace, you can go to other designers quite easily and basically have an unlimited design team. All the designs are also submitted to the site with industry-standard source files so that designs can be easily manipulated by other designers if need be.
4. Get all the elements of your design right
You want a design that is effective and helps you achieve your business goals. If these goals are related to growing revenue, then your design needs to match those goals. Brand awareness, brand loyalty and brand association are all things that you should aim for. In terms of colors, if you look at the top 100 brands in the world through interbrand, the most popular color is blue and then followed by red. While you don’t have to use these colors, it’s worth knowing what the best use.
If it’s a website your designing, then you want a design that helps convert traffic into sales. Understand the different elements of your website like your calls to action, your design / layout, your colors and your copy and make sure they are all based on converting traffic. All these elements need to be continually tested and improved in order to get the best result.
David Ogilvy Quote “Never stop testing and your advertising will never stop improving”
5. Use all the tools of a marketplace
On DesignCrowd, you have access to a directory of designers where you can go and look at their portfolio. There is a polling tool that allows you to poll your customers, friend’s family and employees about what they think of your design. For those of you who are looking to hide your projects from Google and competitors, there is also a function that allows you to do this. In terms of social media, make sure you use it throughout your design phase to gather opinions on what you’re doing and see if you are on the right track.
6. Avoid common design errors
Don’t make your design too complicated or have too much detail. If you’re getting a website design, don’t have too many things on the page and keep it simple for the user. You should try not to make the mistake of having a design that is effective to you or meaningful to you, rather than what will resonate more with your target audience. To uncover what will work, you can try testing your brand or design using Google Adwords to see what get’s the best outcome. You could also look at trying different domain names at the same time.
“No matter how good your idea is there is a fairly probable chance that someone else in the world has that idea. It may be the case that no one else has acted on that idea, but there is always a chance that they will if it’s a good idea. That said, you will always have competitors”