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A&E Hopes Start-Ups Will Boost Sales

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Libby O’Connell keeps wanting to give away shoes. With the repeated offers, you get the feeling her office is stuffed with boxes of the Stinger 2 sneaks. And, exceedingly proud of her loot, she can't wait to unload them.

“They’re awesome,” she says.

The executive has the spiffy running shoes -- which have springs embedded in the soles -- because of the venture capitalist route the A&E Network is taking. O’Connell, a senior vice president in corporate outreach at A+E Networks, put the initiative in motion last year.

She’d become interested in getting A&E involved in crowdfunding, traditionally a way for individuals to give money to boost non-profit causes such as disaster relief. She came across RocketHub, a company with a program to help small-time entrepreneurs raise cash online.

“Originally, I thought of it as an educational outreach campaign, where we could go to colleges and seniors in high school and talk to them about this new entrepreneurial spirit and ways to take your idea and make it a successful business,” she said. “And, then I thought this is bigger than that.”

Conversations with other A&E departments led to “Project Startup.” Plans still call for an educational component. But don’t be surprised if a “10 Simple Rules For Successful Start-ups” brochure winds up with a Starbucks or Wells Fargo logo.

A&E wants to turn its partnership with RocketHub, the New York start-up, into a new revenue stream. It wants crowdfunding from Madison Avenue.

“We want to bring this to our advertisers,” O’Connell said. “We think it’s a perfect fit.”

“Project Startup” is emerging from behind a curtain this week partly with an A&E microsite. But A&E has been working with RocketHub for some time.

O’Connell got the springy running shoes when A&E gave money to Spira, the start-up she says has a deal to offer them at sports retailer Modell’s.

The sort of beginner’s guide to venture capitalism that takes place on RocketHub doesn’t give a funder like A&E any equity in the next would-be Nike or Apple. Merchandise and related products are given out instead.

A&E won’t say how much it gave to seed Spira, but the company turned to RocketHub with the goal of raising $25,000. It brought home $42,000 with help from more than 280 backers.

A&E has also given money to boost Active Desk, a product allowing people to pedal while using a computer at work. It’s got money in glasses that look to ease migraines by shielding the light. And, it’s backing World Housing Solution, which has developed “reusable earthquake and hurricane resistant" shelters inspired by the suffering in Haiti after the 2010 earthquake.

A&E has given no more than $17,000 combined to the three ventures. O’Connell has made the investment decisions after scouring the considerable variety businesses seeking funding on RocketHub.

A&E plans on seeding 10 projects this year. But that could change based on advertiser interest.

The network hasn’t signed any advertisers yet, though will use the upfront market as one venue to generate sales. Its vision calls for advertisers to link with specific RocketHub-posted ventures. 

So, Kraft might be attracted to a company with a home-grown recipe. Or, Microsoft might want to connect with a business it believes represents top-tier innovation. Starbucks might want to help a fledging manufacturer – like Voyageurs Coffee, “a family-run roastery” in Vermont, which is seeking money now on RocketHub. 

Then, A&E hopes to offer multi-platform sponsorships. There would be on-air vignettes perhaps telling a touching story of how Starbucks helped Voyageurs. Or, Wells Fargo helped a failing business keep the lights on before it hit it big.

Starbucks or Wells Fargo would also link with all kinds of other A&E properties in social, digital and other realms. (O’Connell was intrigued by crowdfunding for A&E, partly because some shows such as hit “Duck Dynasty” focus on a small business with an entrepreneurial ethic.)

In the process, the entrepreneurs’ products would receive prime-time exposure. Brian Meece, the 39-year-old chief and co-founder of RocketHub -- which makes a commission on money raised -- says start-ups embrace the site for both fundraising and “awareness” opportunities and the A&E link can help with both.

“We get to really serve them in a powerful way because now they have access to a huge mainstream audience … and A&E is adding extra funds,” he said.

David DeSocio sees it is a “true win-win-win.” The entrepreneur gets funding. The sponsor looks like a hero. And A&E has an innovative way to collect ad dollars.

“If done properly, everyone can win, everyone can walk away with something from this,” said DeSocio, a senior vice president in partnerships.

How about taking it a step further? A&E creates a reality series about one of the start-ups helped via RocketHub. Marketers take top-line sponsorsships with ample product placement openings. And the no longer small-time entrepreneur gets even more money.

2 comments about "A&E Hopes Start-Ups Will Boost Sales".
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  1. Tony Reynolds from A KickIn Crowd, April 16, 2013 at 10:04 p.m.

    It's great to see a large company try to innovate. BUT, it appears they missed where they could obviously make the most impact!

    My firm, A KickIn Crowd dot com is starting in the school space now. Look for us in the near future.

  2. Tony Reynolds from A KickIn Crowd, April 16, 2013 at 10:04 p.m.

    http://www.akickincrowd.com

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