Keith Winn says he has always been an entrepreneur at heart, “whether it was in grade school selling the things grade school kids sell, or in junior high conning the local bicycle shop into letting me be a bike mechanic, to starting the ski club and bicycle club in high school.”
A product development expert with roots in design engineering who has worked at Texas Instruments and Honeywell, Keith designed everything from global positioning systems to circuit boards for military aircraft. Later, he designed the predecessor to the now-iconic Redbox video dispenser, and as a partner with the pioneers of the photo-on-driver’s-license business, he invented, patented and sold to 10 states the methods to add significant efficiency in vehicle registrations.
After getting serious about photography, Keith, of Clearwater, Fla., submitted a picture in a recognized Orlando art show. His photo sold for a record $2,882. That attracted the attention of Tampa-based Florida Museum of Photographic Arts, whose management requested Keith’s assistance in fundraising. After several conversations, Keith realized that photo contests could generate revenue for the museum — and other organizations — more quickly and effectively than standard fundraisers (dinners, car washes, bake sales, coin drops, magazine subscriptions, etc.), which usually bring in hundreds — not thousands — of dollars.
Thus, MulaBula was born.
Setting the Mission
The idea behind MulaBula was to create a turnkey fundraising service for virtually any nonprofit, as small as a little league team and as large as a national charity. There are no upfront fees and no contracts. Clients create and customize their contest on the MulaBula site, following an easy step-by-step process. They name the contest, set a start and end date, choose a theme, upload a logo (if there is one), and use their social networks to publicize the contest. MulaBula handles the credit card processing, provides progress reports and analytics, and transfers the proceeds, less MulaBula’s cut, which varies from 6% to 20%, directly into the customer’s bank account.
Revenue for the contest-holder is generated in two ways. People pay to enter a photo, aiming to win some sort of prize — cash, merchandise or simply recognition. Then, once the entries have been submitted, people pay to vote for the photo(s) they want to win.
The MulaBula value proposition is compelling: There is very little legwork involved — no teams of volunteers to recruit, organize and supervise — and, by leveraging the power of social media, the organization can cast a wide net for people who are happy to spend a little or a lot to support friends, family, their community and/or a cause. The other advantage is that there is zero financial risk, because MulaBula gets paid on the back end.
The idea was to build the MulaBula site to make the customer experience easy and intuitive while keeping startup costs to a minimum. “I leaned on my friends who were prior software vendors and got the equivalent of $10,000 of software for free,” Keith said. When his first customer wanted costly customization, he contributed a small amount for development in return for a favorable discount for as long as he remains a MulaBula customer.
Most organizations find the contest concept so popular that they repeat it every year, generating more participation each time. In the case of the Humane Society of Pinellas County (Florida), it costs $10 to enter a photo, and $1 for each vote, with a five-vote minimum. The winning photographs get put onto a calendar, which the group then sells to generate even more revenue. Last year the group raised $10,997 with its MulaBula campaign.
Growing the Business
While the average contest raises $3,000 to $5,000, MulaBula’s three most recent customers collectively raised more than $100,000 in their contests.
Company revenue has passed the $180,000 mark to date, “with just a handful of clients,” Keith said. Growth has been organic so far, with every customer coming back for more contests, but Keith is considering seeking outside investors to help take the company to the next level. “Our goal for 2017 is to have 300 customers per month. At an average of more than $3,000 in revenue, that’s almost $1 million that MulaBula can raise for clients per month,” he pointed out. The five-year plan is to raise $20 million a year and handle 500 customers at any one time.
Currently, operating costs typically run about 25% of the income. By scaling up, Keith believes that number can be brought down significantly, to below 10%.
Dealing With the Realities
Starting a business with little investment capital has meant that Keith’s been building his business as a sideline to his day job. “So far, every bit of profit goes right back into R & D — we haven’t been able to pay ourselves anything yet,” Keith said. “MulaBula is a part-time job that I can’t wait to become a full-time job.”
If he’s successful in raising cash, Keith plans to “do more aggressive, focused marketing,” and make two key hires “who could drive sales and marketing while I drive growth and implement new features and products.”
Here are some of the lessons he learned:
You don’t want to grow too fast. Make sure you have all the fundamentals down – the client experience, the customer service – before you think about growth.
Stand out. There are or will be competitors in every business, so we wanted to make sure that our product is differentiated. For MulaBula, that means a lot of interactivity and user-friendly features. For example, you can enter contests by cellphone. It’s one-click voting—no need to register first. There are automatic acknowledgements every time anyone enters or votes, with a little call to action that encourages people to post their entry or their favorite photos on Facebook, or send those favorites to family and friends. For organizers, reporting features allow them to see results that will help them refine their campaign. Audit reports and participant reports are emailed however often the customer wants, whether daily, weekly or monthly, so they know who entered, how much they spent and what photo they voted for. That information can then be used to send targeted emails to build up more excitement.
Know your customer. You really have to get in the heads of the users and figure out what features and functions they want in a product. No matter how smart the inventor is, or how great the entrepreneur’s idea is, if the consumer doesn’t understand it or like your product, you won’t be successful.
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