Motherhood is a challenging endeavor, and mothers often face it with innovative solutions. So says Chicago entrepreneur Catherine Merritt.
"Moms are really innovative and they have all these ideas," she said. "They have unique needs and pains given what they're faced with in their life at this point." Those factors inspired Merritt to found Mumzy, a crowdfunding site for entrepreneurial moms.
The platform allows users to run two kinds of campaigns: reward-based and donation-based. Reward-based campaigns will promote product or service ideas and give backers perks depending on how much they pledge, similar to Kickstarter.
Donation-based campaigns will more resemble Chicago-based GiveForward, in that they will allow users to raise money to support individuals in need. For example, Merritt said, someone could run a campaign for a friend who just had twins to hire a night nurse.
She said Mumzy will collect 5 percent of whatever is raised. That's in line with what industry leaders Kickstarter and Indiegogo charge. Kickstarter collects 5 percent. Indiegogo collects 4 percent for campaigns that meet a certain fundraising goal and 9 percent for "flexible funding" campaigns in which fundraisers don't meet their goal. On all those sites, campaign owners also pay fees to payment processors.
"What makes Mumzy unique is it's about moms to post entrepreneurial projects, new innovations," Merritt said. "It can also be moms supporting moms."
Mumzy joins a growing list of crowdfunding sites that mimmick or resemble the Kickstarter model and target a niche audience. Kendall Almerico, a Washington D.C., lawyer focused on crowdfunding, said the U.S. features more than a thousand other crowdfunding sites. Because of the competition, he said, Mumzy will have to prove its community can raise money with a few early successful campaigns.
He said he sees moms as a good crowdfunding target. "The pieces are there for this to work," Almerico said. "You've got the passionate audience, you've got an audience that spends money, you've got an audience that supports itself. There's not a lot of niches that has those things and the mommy sphere does."
Merritt, a vice president in the Chicago office of PR and social media agency Olson Engage, said she started Mumzy about two years ago in a partnership with her employer, which counts among its clients several brands that court moms. In 2014, she gained full control of Mumzy before ICF International acquired Olson later in the year, said Olson president Bryan Specht.
"My biggest fear is this thing's so successful that she moves on and becomes full-time boss of Mumzy," said Specht, an advisor to Merritt and her company.
Merritt released Mumzy in a limited scope in late December 2014, but she said she quickly learned that the site lacked functionality and that visitors didn't like the user experience.
She took the site down and rebuilt it. She said she raised $125,000 through friends and family to hire a development company - Chicago's Juice Interactive - and to license CrowdEngine, a crowdfunding software.
In the near term, Merritt plans to run Mumzy while keeping her job at Olson. She said she's working with a few freelancers and the external Juice development team, which covers most of the work the site requires for now. She said she would consider hiring and raising more money if the site grows quickly.
Merritt said anyone who designs products that can benefit moms, regardless of their parental status, can list projects on Mumzy. She hopes to use her brand connections to help those creators bring their products to market. She said that one day could provide another revenue stream.
Specht said Merritt gained control of Mumzy for free partly because of her potential to connect Olson clients to the site. As part of the deal, Olson will get a first opportunity at sponsorship opportunities.
"There's a lot of different ways we think this can benefit the kinds of companies and brands we work with, but it's not our core business to actually own it and run it," Specht said. "It's more our core business to bring these types of things to clients and broker those relationships."
Amina Elahi is a Blue Sky reporter for the Chicago Tribune.
(c)2015 Chicago Tribune Visit the Chicago Tribune at www.chicagotribune.com
Distributed by Tribune Content Agency, LLC.