Learn more about convertible campaigns.
Smart homes need rethinking. Many products are over-specced, have the look of high-tech gadgets and target tech-lovers alone.
Ding designs products that are: smart, beautiful and truly simple for consumers to use. Our first product, the Ding Smart Doorbell, connects you to visitors at your front door using an app on your mobile phone. You no longer miss visitors or deliveries when not at home.
Ding overfunded its 2016 Kickstarter by 200%; reached over £100,000 in pre-sales; raised over £250,000 from 229 investors in its previous Seedrs round; and is now agreeing a distribution deal for 5,000-6,000 units with a leading UK retailer.
Our product received international press coverage in design and tech magazines, from Wallpaper to Wired. The quick reliable voice calls, zero-tools installation option and minimal, instagrammable design appeals to a wider audience of design-conscious buyers as well as tech early-adopters.
We have also built our voice platform, giving us some great IP for product expansion.
This convertible round will support our UK retail launch with marketing, technical services and working capital putting Ding in an even stronger position within the smart doorbell market, predicted to grow at a CAGR of 78% through 2021.
This investment round is being raised by way of a convertible equity investment structure.
The key terms that apply to the Ding convertible are as follows:
• Discount – conversion at a 20% discount to the valuation set by a Trigger Event.
• Valuation cap of £5,000,000
• Conversion is triggered by ("Trigger Events"):
o An Equity Fundraise – defined as the Company raising investment capital of at least £500,000 from one transaction or a series of transactions, in exchange for the company issuing of Ordinary Shares;
o A Change of Control of the company (transfer of more than 50% of the share capital); or
o An IPO – being a listing of the company’s shares on a recognised stock market or secondary market.
• Longstop Date is 12 months from the date of the convertible agreement.
• If conversion has not been triggered by the longstop date shares will be issued on the longstop date at a valuation based on the lower of:
(i) the lowest price of any Ordinary Share issued after the date of this Agreement; and
(ii) a pre-money company valuation of £3,000,000 on a fully diluted basis.
The convertible would also convert to equity at this price in the event of winding up or liquidation of the company.
Many of the video doorbells on the market are obtrusive, surveillance devices cost-optimised with low build-quality. They require perfect internet connections, recurring subscriptions and alert you when your neighbour’s cat passes your front door.
- Our Intuitive User Experience: two key barriers to smart product take-up are concerns that the technology is still developing and that set up and usage are complicated. Ding includes a zero-tools installation option, simple app setup, and alerts that come through as a quick voice call rather than your phone opening an app every time or streaming video.
- We Build Quality: current smart home buyers are high earners, with a large disposable income. Ding appeals to customers who have invested in the interior design of their homes and want to complement it with premium tech.
- We Work Offline: we’ve designed our product to work well even on poor or no Internet connection. Unlike many of our competitors our product price includes the Chime and works locally when there’s no connection to your phone.
Substantial accomplishments to date
Ding are DESIGN COUNCIL SPARK programme winners. This took our product from idea to a prototype and allowed us to develop a real business proposition. We were one of 3 teams to receive the full £65,000 out of over 350 who entered.
Being mentored through JOHN LEWIS’ JLAB ACCELERATOR. During 12 weeks we worked directly with the inhouse design and buying teams to develop Ding’s retail strategy, covering everything from production and packaging to price point with our mentors on the JL team.
We ran a hugely successful KICKSTARTER campaign last November, raising $111,000 from 850 backers, reaching over 200% of our target. Since then we’ve continued to raise preorders from INDIEGOGO InDemand.
Our last SEEDRS round raised over £250,000 from 229 investors. This capital has already allowed us to reach our goal of expanding the team and setting up production in the UK.
Ding’s all-star TEAM is skilled in developing products and has previous achievements, including successful exiting startups and developing internationally successful online streaming services.
We received a huge amount of INTERNATIONAL PRESS COVERAGE in mainstream newspapers (The Guardian) as well as design (Wallpaper), tech (Wired) and business (FastCo) publications.
Our product has received the Design Intelligence Award Top100! award.
We also have an excellent relationship with leading UK RETAILER John Lewis as well as other online and brick and mortar retailers in the UK and internationally.
| 1: INTRODUCE PREMIUM PRODUCT TO MARKET |
- Launch SMART DOORBELL SET (£199) BRASS BUTTON and CHARCOAL CHIME.
- Establish brand reputation and generate revenue.
| 2: LAUNCH COST ACCESSIBLE, MASS MARKET BUTTON |
Sell BUTTON and CHIME products separately (<£99 TBC).
- Reach mass-market audience only fulfilled by 'dumb' doorbells at current price point (not by video-doorbells ~£159 exc. Chime), enabling us to scale-up revenue, and invest in operational and internal IP / development capabilities. Add-on purchases also increase our customer lifecycle.
| 3: LAUNCH EXPANDED PRODUCT RANGE |
- Use our new capabilities to identify emerging opportunities and expand our product range in both the consumer market and via our IP.
- Identify and take advantage of emerging opportunities both in the consumer market and via our IP. This will include expanding our product range and using our existing IP within new products for both the consumer market and B2B. We expect to develop our in-house capabilities by Phase 3 and lower the need for investment. At this stage, Ding’s focus will be on increasing profit and company value.
Use of proceeds
The funds raised through Seedrs will be used for MARKETING, to expand our TECHNICAL SERVICES team and WORKING CAPITAL to buy more stock.
We extended our development time to ensure product quality and allow us to develop some valuable IP. Now we are past the most risky stage of product development we need MARKETING budget for our retail launch in the UK.
Our backend system is highly automated but we need new hires to maintain the SERVICE and create integrations. With the launch we will need to recruit a full-time SOFTWARE ENGINEER and part-time DEVOPS ENGINEER.
We have an enormous opportunity for a RETAIL launch with John Lewis, one of the most well-renowned retailers in the UK. Having more stock on hand will allow us to move quicker on this and secure other retail deals.
Our core market is style-conscious UK HOMEOWNERS looking to replace non-smart tech within the home.
We're focusing on a PREMIUM design, build and user experience to attract the current smart home market who are are HIGH-EARNERS (>£71k). YouGov estimate over £1,000 pm disposable income for one connected product’s demographic. In this market, we believe small cost savings are a lower priority than quality.
Beyond this, we are looking to increase reach to a less tech-savvy HOMEWARES audience we profile as the PINTERESTERS MARKET. This audience is design conscious, has a wider age profile and a lower tolerance for complicated tech. Our simple USER EXPERIENCE and minimal design appeal to this group.
Our other key customer profiles include AIRBNB hosts, people with ACCESSIBILITY problems and GIFTING purchases for weddings and new homeowners.
Although fulfilling internationally, our initial marketing will focus on a UK-audience with later EXPANSION to the EU and US.
We are also consulting PROPERTY DEVELOPERS building new homes who want the latest smart technology. This B2B opportunity has huge potential for future growth.
Characteristics of target market
- Smart doorbell related Google searches are up by 90% since 2017, showing a growing trend for smart home consumers.
- The global smart doorbell market is set to grow at a CARG of of 78% through 2021.
- Average monthly sales in the smart doorbell category on Amazon (.com) per month total 3,270.
- Considering the types of homes/consumers, uptake of similar smart home products and with analysis of our competition in the US we have estimated there to be an approximate target market of £378.1m in the UK alone.
- Existing competitors Ring’s revenue more than doubled last year, reaching $415 million. (Source: Forbes.) The recent acquisition of Ring for $1.1 billion shows us the market’s staggering growth.
We believe that this presents a huge opportunity for Ding to gain some of the market share. Even a small share of such a market starts to look very healthy.
We will build BRAND TRUST using: PR on our company story, a UK husband and wife team with a ‘Made in Britain’ badged product; our newsletter; and our four-strand BLOG strategy to position us as a design authority, open up affiliate marketing, improve SEO and create a platform for UGC.
DISCOVERABILITY will be increased through PRODUCT REVIEWS, a key part of our HIGH-EARNER demographic buyer journey, increasing engagement and giving us early brand advocates.
Design, interior and architectural MARKETING EVENTS and targeting EARLY INFLUENCERS within the design world will reach our interior design or ‘Pinterester’ market.
Our PREMIUM branding creates shareable image-based SOCIAL MEDIA content to maintain and grow our community.
RETAIL and in-store demos will increase exposure. We are finalising one distribution deal and have relationships with retailers in UK, EU, US, CA and ANZ.
Smart doorbells respond to a utilitarian need, unlike smart home assistants or locks. We offer an even simpler user experience than voice commands and are replacing a product buyers already know and understand. We believe this fact and current market growth point towards a quick user take-up for 2018.
Our main competitors are Ring (Amazon) and Nest (Google). The market has already attracted the interest of the giants but current products focus on security and have the look of traditional white and black tech.
With so much attention already, consumers and press will be looking for alternatives. To position ourselves, we know that we need to:
- Target a narrow audience and build our user base;
- Be quick to adapt to consumer demand;
- And, most importantly, stand out.
There is huge scope for us to differentiate as a premium product with out-of-the-box usability and superior design, especially if our competitors continue down the road to cost optimisation.