Twin Oaks CEO Andrey Sikorsky: China Manufacturing Changes Global Crowdfunding Economy

This article is translated from the Tom.com, originally titled “Twin Oaks首席执行官：中国制造改变全球众筹经济”.

Speaking of crowdfunding, you might imagine such a scenario: young geeks in Silicon Valley think of genius ideas in labs, and post them on the crowdfunding platforms.

But the reality is likely to be completely different.

“Currently, crowdfunding projects around the world are mostly born in factories in China.” said Andrey Sikorsky, co-founder and CEO of Twin Oaks Global. Twin Oaks Global is a multinational bag manufacturing group with three factories and hundreds of employees in China.

Since launching business in China in 2003, Andrey has witnessed the entire process of manufacturing in China from low-end to high-end, from “Made in China” to “Created in China”.

“When I first arrived in China, most workers could only make the simplest products, such as shopping bags and T-shirts. But now, China’s manufacturing industry represents the highest level in the world.” he said.

A famous case is DJI, a drone company in Shenzhen. When the concept of quadcopter spread all over the world, there were a large number of startups in Silicon Valley trying to challenge DJI, but they all lost without exception.

In the field of crowdfunding, this phenomenon is also obvious.

“On the world’s largest crowdfunding site, KickStarter, there is a bag project launched almost every day, and most of these products are made in China.” Andrey said that in just 2018, Twin Oaks Global has produced products for more than 10 crowdfunding projects, and many of its Chinese competitors have received similar orders.

In fact, Chinese manufacturing companies can not only produce high-quality products for crowdfunding players, but also go deep into the design process.

“Compared to giants like IKEA, young entrepreneurs of crowdfunding projects often lack experience and can’t balance quality control, cost control and good design.” Renaud Martinez, Chief Creative Officer at Twin Oaks Global explained.

At this time, the years of experience of manufacturing employees often become the key to the success of a crowdfunding project.

Renaud said that a KickStarter startup team recently found Twin Oaks Global, hoping to collaborate on a laptop bag. After seeing their design, Renaud immediately found a serious problem.

“They made a mistake that startup teams are most likely to make: cost crisis. Their designs were very futuristic, but the cost control was very bad. For example, they used expensive metal zippers on the bags so much that the cost of the zipper was actually accounted for 30% of all material costs." Renaud said.

With the help of Renaud, they drastically modified the design and switched to silver-plated plastic zippers that cost only 20% of the metal zippers. Finally, compared to the original design, the cost of this laptop bag dropped by nearly 50%.

“Leaving the experience of manufacturing, industrial design cannot play its role.” Renaud exclaimed.

Andrey also fully agrees with him. “In the past two years, more and more crowdfunding projects have shifted the research and development to China. I believe this must be the general trend.” he said.