As Hiral Sanghavi clipped a microphone to the lapel of his jacket, an audience member quipped, “There’s no microphone in there?”
Sanghavi joked back, “Not yet – maybe in version 2.0.”
Sanghavi, a Kellogg student who is currently on leave, was invited to The Garage Monday night to talk about the success of his startup Baubax, a company that creates travel attire. He founded it with his wife and another friend, and raised close to $10 million in less than 60 days through Kickstarter.
The Baubax Jacket that Sanghavi and his wife designed does 15 things at once, including an inflatable neck pillow, cup holder and a built-in stylus and pen.
The idea for the “world’s greatest travel jacket” came about because Sanghavi never remembered to pack a travel pillow for frequent trips between Chicago and the Bay Area.
“Every time I took a flight, I ended up buying a pillow and an eye-mask,” he told a small group of students in The Garage. “I accumulated a dozen pillows in Evanston and a dozen in San Francisco. My wife told me, ‘This is it, you’re not buying anymore pillows.’”
Yoganshi Shah, Sanghavi’s wife, is a designer, so the two teamed up to come up with a creative solution to the problem at hand.
“She came up with the idea, that ‘You’re in Chicago, it’s cold, you’ll never step out of the house without a jacket. How about a jacket with a pillow?’”
Sanghavi said he instantly saw a million dollar idea.
After launching the Kickstarter, Sanghavi’s PR firm helped place an article with CNN Money, but soon afterwards, it seemed that Baubax was generating buzz on its own. Within another week, another $500,000 had been pledged on Kickstarter. But Sanghavi had a hand in helping the campaign generate popularity.
“We started running Facebook ads on the fifth day,” he said, and not on other social media sites such as Google or Twitter. “On Facebook, if you share an ad, I will get charged once. And after that, if your friends share it, I won’t get charged. It’s more effective.”
Additionally, by setting the initial Kickstarter goal low, Sanghavi predicted that media outlets would pick up on the story much faster as the pledged funding vastly exceeded the initial goal. “An MBA student asking for $20,000 but raised millions – that’s the tagline and the story,” he said.
He estimated that before launching the campaign, he would have needed at least a million dollars just to break even. But as an avid Kickstarter follower, he knew enough about the site’s algorithms to figure out how to land on the homepage, and listing a $1 million goal would make it harder to do so.
“If your goal is $1 million and you raise $50,000 a day, you won’t end up on the homepage,” he said, noting that campaigns with low goals but high rates of funding are more likely to be featured.
For students in attendance, Sanghavi offered up valuable advice and inspiration. Jackie Wu, a robotics graduate student, plans to launch an Indiegogo campaign for a robotics start-up. “A big thing I took away is the sense of hope,” Wu said. “ This is doable for people like me and you. The video was good but the actors were his friends and people he knew,” Wu said, referring to the advertisement video featured prominently in Sanghavi's Kickstarter campaign.
“I’m not an entrepreneur, but it was interesting to see how I could apply some of this to other business ventures,” Kellogg student Sophia Zeinu said. “He showed me that you have to be deliberate and conscious in the choices you make when you’re launching a business or initiative.”
For Sanghavi, who started his career in entrepreneurship with a $100 investment as a student in India, making a few thousand stencils for engineering students which he sold for about 40 cents, those decisions made a huge payoff.
“It’s rare to be in the same room as someone who’s been wired $10 million for anything, let alone an entrepreneur and one of our own,” said Melissa Crounse, executive director of the Garage, as the session concluded.