Starting Y
Starting Y

Episode 11 · 1 year ago

MorphoMFG From a Failed Crowdfunding Campaign to a Business Idea


Our Intro is based on Quantum Jazz’s piece “Orbiting a distant planet”, published under Creative Commons

Our Guest:

  • Joshua Fairbairn (, the CEO of MorphoMFG (, helps to produce goods in China, of international quality. The idea was born out of Joshua's first failed crowdfunding campaign, where the goods he had produced did not match his requirements. He refunded the proceeds, but got a great business idea.

Your Voucher for MorphoMFG

  • The voucher code is "MMFG & Startup-Y 21"

The Host:

  • Jörn is a podcaster, startup scout and entrepreneur, who is based in Frankfurt, Germany. He has a background of more than 12 years of management consulting, with a focus on financial services and capital markets, mainly in Europe. He hosts an English startup podcast, covering the German startup scene ( You can learn more about Jörn “Joe” here:

You can suggest questions here, use #startingy

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This is a starting why podcast. Here we ask entrepreneurs, actors, investors in the native and hartist on the why, why they are doing what they are doing, what motivates and drive them and why can't they stop? We will start in five hundred and four, three, two, one. Hey, guys, this is Joe from starting why. Today I have an interview guest here for you. The connection is not too good and the simple reason is this is yet another recording across half the world. I would like to welcome Joshua in Guenjo, China. How you doing? Doing fantastic. Thanks for having me. It's totally my pleasure. juanning. So in Joshua, you are an American, Canadian, Canadian. No, fortunately I was not in in your arms reaching this point in time. I see you study Chinese, so it's not too surprising that you ended up in China, but can you give us a brief rundown how and why you ended up where you add right now, with the company in Guanjo in China, which is also known as Canton for people abroad. Yeah, sure, so I'm from Toronto, from Canada. I went to university down in the states and I was studying bio Ken and while I really liked it, I just knew that it was time for me to not be doing by. Okay, I've always done business, you know, starting when I'm young, doing like the kids candy business whatever, and I just knew that that was the life that I wanted to pursue and China just seemed like the right place to go, and so I dropped out. My parents were supportive, but I knew that financially I was on my own and I didn't really have anything. I just had enough for a plane ticket and to start, you know, new life in China. And China's changed a lot since I've been at that's two thousand and thirteen. So I've been here like eight years and China's change the ton. But back then there was not a lot of foreigners in China. There wasn't a lot going on, but I knew that there was a life there to build and so I got here five hundred bucks in my pocket, no job and no friends, know where to live, and kind of just put the pieces together. There's a lot of opportunity to you know, people teach people, there's lots of little odd jobs that you can have. You know, I was working at some clubs. I actually started to do stand up comedy on Chinese National TV, doing some teaching, all sorts of different things, but I knew that those were just plugs, you know, to get me to the next step. And so kickstarter had just come out, was just starting to gain some attention and I thought, you know, I've always loved products, I love music, and so I worked my ass off, the hardest I've ever worked in my life, and made pair of headphones from scratch, right the design, the team, everything. I put it all together and we launched on Indiego go and we did twentyzero dollars almost right away. And back then that was pretty unheard of, you know, people weren't doing that kind of business on any go go back then. Now it's pretty commonplace. And so I was so excited right I thought I was there and getting ready to start this new adventure and start this company and everything was kind of lining up exactly as I hoped it would. And so, like a kid, you...

...know, Giddy going to a candy shop, I got on the bus and it was a four hour drive from where I was to the factory and I went to go pick up the prototype just so that I could continue with photography and continue promotion of the campaign and all that, and it was a pile of garbage and my heart just completely sank and I knew that I couldn't continue the campaign because the product wasn't what I had designed, it wasn't what I had said it was, and so we had to pull the plug. And so you know, obviously there was a period of time there where I was not doing too hot and I think, you know, to use a Chinese metaphor, there was definitely a phoenix rising at the ashes moment for me, in that I realized that helping other companies not have happened. What happened to me was not only very pertinent to my situation but also much more lucrative than the business that I had first pursued when I got here. And so within one year we had a hundred and fifty customers and have really just expanded a lot since then. KICKSTARTER, indiego go, our partners with us. They recommend the people that use their platforms to manufacture their products with us. We've been featured and tons of the big publications around the world and since then we've grown. Now we've changed offices three times. We've had an office here in Guang Joe, you have an office in India and we have a office in Hong Kong as well. So obviously, you know, from that time till now a lot, a lot of other stuff has happened, but I think that is a pretty good job of of summing it all up in a nutshell, with the time we have to there. Remember vividly when how was coming for the first time to China back in two thousand and five to Beijing. It was like a gold rush there. Every FORNA didn't matter way from or what he could do. They just trusted you that your English was good and he could work everywhere as a teacher, and there were a lot of other stuff you could do. But I do believe China has changed quite a lot since. What is your experience from a business point of view? I do believe back then it took a few thousand dollars and a good idea gear to get started. How is the situation right now? Yeah, I think you hit it on the head. You know, back then China was closed for most of China's recent history and it's only opened up since the S. right. It's not it's not the same as it is in Canada or Germany or America. Right, it's been quite sheltered to foreign presents and so, yeah, like you said, when I first got here was a gold rush. Basically just being a foreigner was enough merit and gave you enough credibility to do basically anything that you wanted, and so that was interesting. But yes, the times have changed enormously from mental now basically you need to be good now, what you do. You need to be great, because the culture here is no longer interested in just the fact that you're a foreigner. They're interested in merit and being able to deliver and talent and creativity and and intelligence. Right, it's a very, very different world. It's changed so much since when I first got here, but I think that's good, right. It really is raised the bar for the type of talent that's come in from international places and I think it's made for a much more competitive landscape. I actually...

...have to tell you one of my deepest going experiences in China with when the Chinese people told me about the competitive pressure which thought very early on. It's not uncommon for elementary students to sit there late in the evening until maybe even ten o'clock and to study because the pressure is so hot. There's such a lot of competition. Maybe in Germany their thousand people who can do what you're doing, but in China they maybe million. So there is an extreme pressure there and you now feeling the same? Yeah, I think so. The industry that were in obviously caters to an international community, so I'm not competing with Chinese competitors as much, but I'm more working with them. But in terms of the competitive landscape up here, absolutely right. And it does start, like you said, from a young age, because Chinese know they have the Gal cow write the standardized tests pre university, and that test, your result on that test is basically will be with you the rest of your life. From that test is decided which university you go to and from there which job will get. So definitely from a young age and obviously with a pretty enormous population, there's a lot of competition here for sure. And Yeah, you have to you have to work very hard here to rise to the top. How did you work hard and what did you learn during the last few years just to stay on top of the game? I'm very sure he had to adopt and adjust quite a lot. What, if some of the interesting lessons, not necessarily only for China, but as an entrepreneur, what you've learned, what you've wished somebody had told you before you started? I think the biggest, you know, is being able to pivot. I got stuck out of China for almost the whole year. I was in bowing and then I was on in the Pacific Ocean, in the West Side of Canada. So I don't get a lot of sympathy for where I was stuck, but it was hard because my whole life is here, my friends, my created version of family, you know, my my life is here and it of course it was nice to see my my actual family back in Canada and in the US, but I could be back and the business that we have has relied heavily. I don't know how could your Chinese is but Gwanshi right on relations. Yeah, and being able to have people come and visit, to see the craftsman shift behind the work that we do, behind the level of professionalism that our company has as a standard. And so having people come here was easy. Right. They came here, they saw what we were doing, they saw that we were good and they wanted to work with us. Now, obviously, not being here for a year made us, forced us to pivot. You know, a lot of people couldn't get back into the country for longer than even me right unfortunate enough to figured out a way back, but I think that forced a lot of companies to have to close up shop and not being able to have people come to China and come to our offices was very difficult and I was quite nervous, honestly, that our business would be able to withstand pressure that the situation of the recent times was putting upon us. And we pivoted and, like you said, you know, I wish we had done it earlier. I wish somebody had pushed the harder to do it. But rather than having people actually be here, we had... figure out a way to create a window into what we do. And you know, it's two thousand and twenty one. Production of high quality content, as with your podcast, is becoming easier and easier. You know, Social Media and digital advertising budgets allow you to put your message wherever you want, and so while I was in Bali, I started a marketing department and made some highers that were really great and instead of having people come to China, we brought China to them, and so we started producing content and making videos and really giving people an inside look at what it is that our company does, and that's been really good. What I thought was going to be problematic for the existence of the company actually turned out to be a great silver lining that allowed us to amplify our voice across many platforms. Isn't it that Chinese character of crisis is combined of opportunity and problem? Yeah, there you go. So you Chinese is pretty good. Huh, Nali, Nali. So that is we've use this for. Have you seen any impact? Because a lot of people are right now thinking how the world will change after GRONA. I do believe China got away pretty likely in terms of death, in terms of infections with corona, but I totally believe that corona won't go away anytime soon. Everybody who can get vaccinated should get vaccinated and carry on with their life. But what obviously totally objective from your current position for me, current business. How do you see it the next two or three years developing? What will be changing? Is there anything on the right and you can already see. I think you're right. I think the world's not going to be normal anytime soon. And you know, from an objective standpoint, what does that mean for my business? It means that we're not going to have our clients or potential clients visiting us. It means that we're we're going to have to continue to do what we do to get our message out there and right now we're really working on doubling down on those efforts. You have now full time a photographer in house, we have a video editor and house and graphic designer and house right like we were really doubling down on our arm media efforts and pushing the ability to put content out in front of interested eyes. I think you know it. Like I said, it is a silver lining because there aren't that many people doing what we're doing right now and they're used to be, but a lot of them, like I said, had to shut up, shut the shop use and I think are doubling down efforts and, you know, really putting out what we do there to the world. I think the demand is still very high. People want to make new products. Right in two thousand and twenty one, having your own product. This company is similar to being a rock star in the s. You know, it's the thing that could make you the coolest. So the demand for businesses that make products for people is still as high as ever, but the supply, the accessibility to China and to making products is, I think, considerably lower. And Yeah, I really believe doubling down on our efforts will prove to be quite a fruitful effort. Well, we have to admit that this is not only a problem of China or industry within China. It basically impacts every industry that relies either on tripping our raw materials, even not only from...

...abroad, but of course from abroad, that is completely impacted by all the restrictions put in place by the global pandemic. When we talking about the digital content, that is something I also realized. When you have digital content, of course it went quite well for podcasts all across the board, but do you also feel and increased digital competition going on here? Absolutely, I think within our industry, not so much just because it's a unique approach to what we're doing, but yeah, I mean podcasts are on the rise everywhere and probably since, you know, Joe Rogan really started to take off. Since then, more and more celebrities are throwing their hat in the ring. Having said that, though, I am as big of a believer in quality and consistency as anything, and you know I our position is always to make the Rolls Royce or the role x has of whatever industry were making products for and being unique and providing a level of quality that others either can reach or too lazy or not consistent enough. And I think in when it comes to digital content, that's especially true because the tools with which we need to create a high level of quality or at our fingertips and and it's so achievable now, more than ever, whether it's audio or video or graphic design or editing or whatever it is, it's so accessible, right five or up work, meeting people like it's just it's so available and I think that not enough people are really ending their bar high enough, and that's probably the biggest differentiator in who makes it indigital content and who doesn't. HMM, I totally agree with you here. It's former generation. It's called it to stand on the shoulder of giants, when you basically could use that ability, that tool, that technology is somebody else developed, and when author once called it the world is flat early S, but I do believe it's even flatter now. When you talked about the products, have you also seen there some trends? When you said about the role likes, about the high end product? In terms of product, what you're offering? Let me take you on a little journey, because I used to be a big fan of crowdfunding. For example, I was one of the very first in Germany to have this desktop charging station with multiple plugs. There was something really, really new at this point in time, and I remember when I brought it to the shared office when I was working in consulting at this time, I was getting Oh, what's that? Can I also plug in my iphone? Cannot plug in my android device? Yeah, I truely just plug in a different charging cable. How that works really all and I think a little bit of this novelty went away. Plus I also had some bad experiences, as he said. Basically crowdfunding project, likely not through any fault of their own, which just couldn't delivered and re funded part all of the money I sent to them, but at one point there was so much that it got less interesting. Can you have a look, let's say, one or two years in the future, what will be on the horizon, because at the first it was like very little technical gadgets. Now I'm seeing more stuff, a little bit more advanced, like high end hat sets, microphones, smart mirrors and stuff like this. Do you see...

...the crowdfunding projects getting in terms of hotware, in terms of quality, more complex batter quality and stuff like is this what he's seeing in your client yeah, absolutely right. crowdfunding, as with any industry, is reaching a level of maturity that was not present five years ago. And you know, when I first started, people would make five hundred thousand dollars on a little crappy wallet with no planning, no good video production, no team, no real design, just some pictures or maybe a prototype made at home or in a private workshop or something like that. No plan and that's not possible anymore. I don't care who it is. If you launch a crowd funding campaign these days without preparation and less a miracle and you get struck by lightning, it's not going to happen. And and I think that's only going to become more and more blatantly on. The is is the preparation, the design, the complexity of projects, the utility, the quality of the product, all that stuff is just going to continue to rise and we're definitely seeing that as the industry matures, that more and more of our customers are coming more prepared, with more of a budget pre campaign, with a better constructed team, very goal oriented, a world map moving forward. Those are probably now a little bit more of requests from the crowdfunding community, but I think over the next few years they're going to be absolutely mandatory. I see, I'm actually I assume we think a lot alike for the very simple reason I was just trying to ask you what's her experience of preparing crowdfunding campaign? How much money you need up front, and you talking about rising budget. For example, I have here a crowdfunding campaign I was a little bit in Wolf personally back in a summer two thousand and fifteen, and this crowdfunding campaign raised something like four hundredzeros dollars, but on the other side they had to spend something like Eightyzero, you as dollar, just to get it all the ground. They in terms of PR online advertisement and you said, producing high quality videos continental on. Do you see those budgets and requirement rising, and way do you see right now the threshold to really run a successful campaign rating something like half a million dollars. Yeah, I think it's a bit of a loaded question for a couple reasons. In terms of the budget increasing, the answers across the board. The average, one hundred percent will increase. Where you spend that budget. The majority of successful campaigns, say in the range you're discussing, half a million dollars. They're spending that on ads. All of the big AD agencies that run campaigns are spending a large portion of all of the money you earn on your campaign in acts, and I think that should be the expectation. When you watch a campaign, you should be expecting to make zero dollars profit. So basically, you know if you if you raise half a million dollars. My expectation for anyone in the crowd funding world is that you should not be expecting to make profit. You should be expecting to have launch pad to build a real business and the the money made in a crowdfunding campaign can provide you with the capital you need to buy enough inventory to continue to grow your business and I think that needs to be most everybody's focus is using...

...crowd funding not as a way to make money, but using crowd funding campaigns as a way to launch your company into becoming a real company, and we have hinted a little bit about it time and again. So can you tell our audience, just like thirty second elevate the pitch, what your company is actually doing? What services are you providing before we let you get back to work up, maybe even to sleep, because it's very late in Kenton right now. Yeah, no problem. So more for Mfg. we are a contract manufacturing business that focuses on providing a turnkey and to end solution for design, engineering manufacturing of products. We like to focus on creative, complex products. You know, if you want to make one tho spoons, we're probably not your guys, but if you have iot or hardware based product, something complex, whether it's metal, wood, textile, plastics, we can definitely do it for you and we're happy to offer anybody that here's this podcast the exclusive discount. For any of your fans and everybody would like to use this discount, you can go down here in the show notes. There will be a link and a coat and the only thing left for me is to say thank you for a very much Shishini said Jan Juda Jack Kaishi Sho.

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