Southern Comfort

English: Entrance to Birmingham-Shuttlesworth ...

English: Entrance to Birmingham-Shuttlesworth International Airport in Birmingham, Alabama. (Photo credit: Wikipedia)

Although it’s only a couple of hours away, I’ve never spent much time in Birmingham, the UK’s second city. Now, thanks to a recent acquisition by my company, I’ve spent more time in a place I never thought I’d visit, Birmingham Alabama. Not that it’s particularly easy to get to. Despite the nomenclature, I couldn’t find a single International flight heading into or out of Birmingham International Airport, not even to neighbouring countries like Mexico or Canada.

In the absence of direct flights, connecting flights are the order or the day which means a very long journey from the UK. I don’t know whether I’m especially unlucky, but when you have flight connections in the States, you only have a 50:50 chance of making it to where you intended when you intended. The scope for things to go wrong (weather, mechanical failure, long immigration queues, airline incompetence) seems immense. How native US citizens put up with it is beyond me.

I didn’t know much about the place before I got there and a quirk of fate gave us a free day during our business trip. As we were in the centre of town, we picked up a tourist map from the hotel and set off on foot. The closest destination picked out on the map was the Peanut Depot. We had no idea what to expect but thought if it’s on the map, it must be worth a visit. When we found a shop selling peanuts, we assumed there must be more to it. A quick scan around the place told us that the only other thing worth noting was a plaque on the wall proclaiming it a historic building at 115 years old. If that’s what defines a historic building, half the buildings in the UK wear similar plaques.

The next entry on the map was a tower. When we got there, we realised it was just an office block. A tall office block, but an office block all the same.

Clearly, we needed advice. Luckily, the next destination on the map was the tourist information office. Upon arrival, they greeted us enthusiastically and insisted we sign the guest book. Although there was no dust on the guest book, the previous entry predated ours by some margin. The friendly people directed us to the Civil Rights Institute. Inside the foyer of the Institute, we spied a display case containing something both sinister and ridiculous; a Ku Klux Klan outfit donated by an anonymous donor. Wandering through the exhibits was enlightening but also shocking. It’s hard to imagine mistreatment of a whole race on such a scale barely 20 years after World War 2 and only 50 years ago.

Birmingham city centre is a lonely place. We hardly saw a soul and we walked around for hours. There is a staggering dearth of people given that there are over 200,000 residents. As so few Alabamans seems to walk anywhere, it’s also surprising to find so many cobblers.

I have subsequently stayed outside of town where bizarrely, there is more going on. The scenery’s amazing. There are more bars, more restaurants, more shops and more people. The people in Birmingham are very friendly. They did try to poison me once with something called a peanut butter & jelly sandwich. A vile concoction of sweetness and ungodly textures contained between two slices of bread. I’ve forgiven them, for now, but I will be deeply suspicious of any strange-sounding fare from now on!

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The wisdom of crowds

NXNEi - Day 2 - Kickstarter.com

NXNEi – Day 2 – Kickstarter.com (Photo credit: Jason Hargrove)

The idea of a collection of people chipping in to raise enough money to make something happen is not a new one. Charities have relied on the concept for years, as have mutuals or building societies. The earliest documented such endeavour is Ketley’s Building Society which grew out of the inns, taverns and coffeehouses of 18th century Birmingham.

The funds in that case were for building houses, but similar societies cropped up to pay out money in the case of misfortune such as bereavement or loss of limbs at sea. The members paid a small subscription hoping against hope that they would never need of the society’s services. Many famous modern insurance companies can trace their roots back to such humble origins.

Mention crowd funding to most people and they will not think of charities, building societies or insurance companies. They will immediately think of crowd funding websites. Just as Amazon and eBay have revolutionised selling over the internet, so have kickstarter.com and indiegogo.com have taken crowd funding to a whole new level.

By combining the reach of the internet with the viral effect of social media, crowd funding websites are ruthlessly efficient funding models. If your target audience likes your pitch, you will probably get funded. If your target audience looks at your pitch and gives a collective “meh!” then your funding deadline will pass with nary a whimper. Successful projects tend to snowball as stretch goals are reached adding more and more swag to the booty on offer.

I recently took part in funding this kick-starter project which went on to become the third most successful ever. It is fast becoming a poster child for the kind of innovation that crowd funding can unlock for successful pitchers. In this particular case, the pitch was for plastic miniatures (used for war-games or table top games). The original funding target for this project was $30k. They went on to raise about $3.5m

The upfront costs in making tooling for plastic miniatures is ruinously expensive. The ongoing unit costs per miniature are very low. Funded traditionally, it makes for a risky business because you never know how many units you will sell and whether you will cover your initial outlay. Crowd funding is perfect because if there is no interest for your product, you find out without spending a fortune. If you are lucky, you will end up with a runaway success.

I believe that crowd funding could offer a much more efficient mechanism for companies to build the right products. Using the same kind of mechanism, product managers could design pitches for new products. Salesmen (or maybe even customers) could commit to delivering a certain sales target. If the project reaches the profitability target, it gets funded.

There is even scope for the project to work in reverse with the consumers designing the pitch and when enough people say “I’d like one too” – a company takes up the mission of delivering the product.