A local company is taking a new road to find investors. Instead of going to the bank, From The Earth Naturally uses crowd source funding to ask the general public for money.
In return, people get some relief from their menopause.
“The challenge with investors is that they want to have sales or what they call a letter of intent that proves that the product is viable in the marketplace,” said company founder and CEO Anita Dyrbye.
“You need the capital to build inventory or do some activity to build the company. So what crowd source funding does, it gives companies an opportunity to try and pre-sell the product to consumers based on your sales pitch.”
To put their product Vivaca on the market, From The Earth Naturally uses Indiegogo, an international crowdfunding platform.
The website allows small entrepreneurs and individuals to ask the general public to pledge money to a product or project.
Dyrbye said they have to collect $50,000 in pledges within 45 days. If they fail to reach their goal, Indiegogo will not process the money and return it to the customer.
“We are very excited to take this to the public and share what we’ve done and we hope that they will share the link to our Indiegogo platform and get this thing moving,” she said.
She added the company is one of the first to sell a natural health product through crowd source funding.
Vivaca is a blend of four herbs grown and processed in Canada. The herbs are sold as a liquid concentrate that is mixed with 500 mL of water.
She said the drink tastes like herbal ice tea and helps to alleviate emotional and physical symptoms related to menopause.
If her company is successful in their sales pitch, Dyrbye said she can produce about three months’ worth of supply.
Crowd source funding does carry some risks for both the consumer and business owner.
Ray DePaul, director of the Institute of Innovation and Entrepreneurship at Mount Royal University in Calgary, said there is always the chance of not getting your money’s worth, or to get nothing at all.
“But I think certainly a lot of these systems do a good job of vetting those people and making sure the bad ones get kept out,” he said.
“And as they say, you only get to do that once.”
DePaul said crowd source funding is a good way for small entrepreneurs to get their foot in the door without relying on big investors or banks.
But it also requires them to be more transparent and efficient. A greater number of investors may not have the patience or knowledge of a few experienced buyers.
His advice to anyone wanting to fund a company is to pay no more than they are willing to lose.
People might also sort good apples from bad ones by using websites that have been around for a while and fund projects that receive a lot of attention.
“Whether it’s buying a smart watch for $150 or investing in a nephew’s fledgling business, with both of those there is a decent chance you won’t see that money again,” he said.
“But there is also a chance that you could be part of something really special and feel good about helping an entrepreneur.”
Dyrbye said funders will receive rewards for their money.
For $25, investors receive a sample box of Vivaca, and $300 can get them three months’ worth of supply.
Anyone willing to pay $10,000 is either getting a free menopause party at their house – with the company as hosts and a naturopathic doctor present to answer questions – or a trip to Edmonton with a chance to drive a racecar.
The company is still waiting to receive their product license from Canada’s National Health Products Directorate but Dyrbye said they are hoping to hear back from them this week. The product is already being sold in the United States.
From The Earth Naturally is hosting a video launch party for their Indiegogo platform on Thursday, April 25, at Cerulean Boutique at 12 Perron Street.
The event will take place from 7 to 9 p.m., with music, a pajama show-off and snack and wine samples from local businesses.
